Broker / Agent

 

What does this person do?

Brokers and agents sell insurance policies to individuals and companies that want to guard their assets against liability. In the event of a fire, injury, or accident, customers call their agents; therefore agents must have a detailed knowledge of policies and their limitations. Insurance brokers can also be independent business people, or work for a brokerage firm, bringing customers and insurance companies into a contractual relationships. Brokers are tasked with:

  • Understanding influences on the financial services environment and staying up to date with developments in the industry.
  • Manage all aspects of the insurance transaction by advising the client, arranging and invoicing the policy, and facilitating claims.
  • Provide consumers with choice in the marketplace, since they usually sell the insurance products of more than one company.
  • Identify the exposure to risk that consumers face and protect them from that exposure.
  • Service the portfolios of existing clients and work to bring new clients on board.
  • Help consumers deal with loss by ensuring the claims process moves as quickly and efficiently as possible.
  • Prepare reports, maintains records and keeps track of a client’s changing needs by maintaining relationships.

Insurance agents work indoors, usually in their own offices. Agents also travel to the offices or homes of their clients.

Insurance brokers or agents who are employed by one insurance company are called “tied agents“ because they promote only the products of the one company. Independent brokers market the products of several companies

and place insurance policies for their clients with the company that offers the best rates, coverage and benefits. Brokers also provide clients with information on investment instruments such as mutual funds, annuities and

long-term savings plans. The work of an insurance broker often overlaps with that of a financial advisor.

 

Personality Traits

Insurance brokers should have the following traits:

  • Good people skills to interview and listen to clients and identify their insurance needs
  • Ability to communicate complex ideas, critical thinking, time-management and organisation
  • Patience to offer help and respond to queries
  • The ability to gain the trust of other persons
  • The ability to do calculations and compare rates and product benefits
  • Comfortability using a variety of computer applications and enjoy maintaining organised records using computer software
  • Have an entrepreneurial spirit and are happiest working independently, setting own pace and schedule

 

Learning Path

The Financial Service Board (FSB) requires people in this occupation have an entry level qualification of a National Senior Certificate or relevant NQF Level 4 qualification. This must meet diploma or degree requirements.

Having the following makes for better opportunities: Insurance and Actuarial Science Degree, BCom Insurance or General BCom.

In addition to in-service training employees may take the examination of the Insurance Institute of South Africa. Two levels of examination lead to two diplomas, namely the qualifying examination for the Associateship Diploma and the Fellowship Diploma.

The FSB also publishes a list of approved qualifications which are relevant (either generally or specifically) to the various categories of Financial Service Practitioners. It is a requirement that a person in this occupation either enters the industry with a FSB recognised qualification, or alternatively obtains a FSB recognised qualification while working under supervision in the industry. The maximum timeframe for supervision is 6 years in which to obtain a relevant qualification while working under supervision.

The FSB also requires that you become FAIS ‘Fit and Proper’ compliant during the period in which you are working under supervision. This involves completing the Regulatory Exams (RE) for Representatives. The FSB RE Level 1 is compulsory for everyone. There are in the region of twenty categories of RE Level 2. You will need to enter and pass a separate exam in all of the categories in which you want to be licenced to trade.

Professional body membership and professional designations are however highly valued by the market and for this reason many Insurance Agents follow learning paths that lead to professional designations. Learning paths are as follows:

  1. Obtain an FSB recognised qualification and complete the RE Level 1 and RE Level 2 examinations before you may work independently as an Insurance Agent.
  2. Study through IISA registered training providers. The entry requirement is a National Senior Certificate. Candidates on this stream can move to progressively higher levels of IISA professional designations. These designations are most relevant to those who operate in the Short Term Insurance market.
  3. Obtain a Further Education and Training Certificate NQF Level 3 or Grade 11. From here you can enter a varierty of learnerships, and also gain work experience, at least a years’ worth. You can then Obtain an FSB recognised qualification and complete the RE Level 1, after which you can complete a relevant Professional Competency Examination of the Financial Planning Institute (FPI).

Please note that the learning paths for the occupations of Insurance Investigator, Insurance Loss Adjustor and Insurance Risk Surveyor can provide entry into the learning paths for this occupation.

 

Employment Avenues

  • Insurance companies and brokers
  • Self-employed, as freelance agent or insurance broker

Ongoing career opportunities within this field reflect both the size of brokerage firms and the increasingly international scope of the industry. With a smaller firm you may pursue a rewarding local or regional career, while larger and international firms will enable you to take on national and international responsibilities.

A broker role can also be an excellent starting point for a broad range of insurance-related careers. Many of those who specialise in specific areas of insurance, like marine, aviation or environment, started their careers by training as insurance brokers. Others move into management roles – managing a team of brokers or several branches of a brokers’ company – or shift to other functions within the industry, including underwriting, new business development, risk management or adjusting.

 

Professional Regulation

Insurance Brokers have to meet the fit and proper requirements of the Financial Advisory and Intermediary Services (FAIS) Act in order to give advice or provide intermediary services to members of the public. This means that they need to be registered with the Financial Services Board (FSB) as Representatives and meet their annual requirements for Continuous Professional Development (CPD).