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"Zurich Advice" new business model
Building extraordinary partnership

Zurich Insurance Group (Hong Kong) (“Zurich”) today announced the launch of a revolutionary model of its financial advisory unit, “Zurich Advice”. It represents a breakthrough in the agency management model from the traditional hierarchy-driven to a functional specialization structure. It also ushers new partnership between the advisors and the company by integrating the strengths of the operating models of both insurers and banks. Advisors can choose to be either management or business partners. The structural and business model breakthrough of “Zurich Advice” not only sets a new benchmark for financial planning, but also facilitates Zurich to identify and nurture talents in a systematic way, enhancing the goal-based financial planning services.

Denny Chan, Zurich Director of Life Business said, “The number of sales agents was seen dwindled by half from 50,000 in 1999 to 27,000 people in 2005 since the introduction of the ‘Insurance Intermediaries Quality Assurance Scheme’ in 2000. Nevertheless, the individual life new business has increased by more than 2 folds in the last 6 years. This shows that it is the innovative business model rather than the size of the agency force that ticks.”

Mr Chan added, “Seeing this trend, Zurich pioneered in introducing a brand new partnership concept in our ‘Zurich Advice’, taking the best out of agency management and bank’s operating models. The new model is a testament to Zurich’s forward-looking service philosophy and its commitment to financial planning market in Hong Kong.”

Since the launch last June, “Zurich Advice” has started to evolve into functional specialization. Managers are now in the proportion of 1:5 with financial advisors. In this light, managers can focus more on agency management, which is different from that of multi-tasking under the traditional model. As a result, “Zurich Advice” has enjoyed a healthy development since its inception, currently taking up 20 percent of Zurich’s agency force.

Zurich is pursuing a dual agency management model of both direct agency and functional specialization. The former model is appropriate for experienced advisors striving for entrepreneurship. The new “Zurich Advice”, characterised by functional specialization, suits those advisors who favour a well-structured career path in place of the traditional mentorship or promotion-by-hierarchy concept.

There are four centres established under the new model, including “Talent Centre”, “Development Centre”, “Growth Centre”, and “Achiever Centre”. Each under the supervision of a centre head and a deputy centre head for its day-to-day operation and long-term development. It also features a pre-set advancement schedule, in which the advisors can move up their career path in a more expectable way.

The structural change, coupled with profit-sharing partnership-based new business model, brings benefits to financial advisors, Zurich and customers.

Through on-going assessments, outstanding advisors can choose to be management partners for the company and jointly formulate development initiatives and manage the team. Alternatively, chief advisors can be promoted to be business partners under the “Achiever Centre”, focusing on delivering financial planning services without being involved in the recruitment and training work of the team. This well puts into practice our belief in “the right people doing the right thing”.

Under the principle of profit-sharing, each functional centre will jointly pre-set various targets with the company, including service standard, sales level, cost-effectiveness and business performance. If the centre succeeds in attaining those targets, the respective partners will, on top of their basic salary, enjoy profit-sharing. This is to recognise their outstanding efforts in formulating initiatives, raising sales performance and enforcing cost control. The concept differentiates the new model from the traditional agency compensation scheme which is solely based on the premiums generated.

Mr Chan concluded the benefits of the new model, “The revolutionary model of ‘Zurich Advice’ will enhance the commitment and sense of belonging of financial advisors to our company. Sales performance will then be beefed up while strengthening long-term trust relations with our customers. Also, our customers can benefit from not only goal-based financial planning solutions but also objective and excelling advisory services.”

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