Very closely connected with marketing, there may
be considerable overlap of activity, if separate sections exist. The name,
however, indicates the functions, which specifically will include:
(a) Product liaison: it is vital that the closest
co-operation exists between Product Development, Marketing and Sales, for
obvious reasons. Poor communication between colleagues in this area could have
disastrous results.
(b) Sales enhancement programmes: again requiring
co-operation with other colleagues, e.g. Training and Marketing.
(c) Monitoring: it is important to keep abreast
of results and trends. Again, much teamwork with colleagues is required.
UNDERWRITING
This may be defined as the selection of risks to
be insured and the determination of the terms under which the insurance
is given. With non-life insurances, it also involves a continuing process of
monitoring results and individual risks, to see whether renewals should
be offered, and on what terms. Special features to note are:
(a) Life insurance: for individual life policies,
underwriting is a once only exercise, since the policy cannot be
cancelled by the insurer and changes are only possible with the insured's
consent. Because of its crucial importance, life insurance underwriting is
often centralised.
(b) General insurance: here the range of
different cover is very wide and mistakes in underwriting are not permanent, in
the sense that policies will come up for renewal and their terms be reviewed,
and can even be cancelled if necessary. Therefore much less centralised
underwriting is still affordable.
(c) Guidelines: whilst underwriting is at a ‘one
to one’ level, there is obviously a need for the preparation of underwriting
manuals, rating guides and similar guidelines for staff. These involve
considerable research and development, again with much attention to trends and
results.
(d) Target risks: curiously, this term could mean
highly desirable types of business (in Life Insurance) or highly undesirable
types of business (in General Insurance). In the former, of course, this is
business the insurance intermediaries should be encouraged to seek diligently.
In the latter, the term could mean large, hazardous risks, e.g. petrochemical
plants.
Each insurer will have its own ideas about what
constitutes desirable or undesirable risks. Typically, however, in life
insurance, healthy young professionals are likely to be desirable contacts. In
theft insurance, jewellery stores in Central Hong Kong may not be favoured.
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