Blackwell Publishing Ltd.Oxford, UK and Malden, USAIJTDInternational Journal of Training and Development1360-3736Blackwell Publishing Ltd. 20062006103••••ArticlesTraining needs of life insurance sales
representatives in TaiwanInternational Journal of Training and Development
International Journal of Training and Development 10:3
ISSN 1360-3736
A study to identify the
training needs of life
insurance sales
representatives in Taiwan
using the Delphi approach
Chiang Ku Fan and Chen-Liang Cheng
This article reports a study conducted to identify the needs for
continuing professional development for life insurance sales
representatives and to examine the competencies needed by
those sales representatives. A modified Delphi technique was
used. Most life insurance companies in the USA implement an
education and training plan advocated by the Life Office Management Association. Insurance companies in Taiwan implement similar education and training plans, but they do not
seem to result in the successful performance of their sales
representatives. Besides augmenting knowledge of various
financial products and marketing approaches, this study also
suggests that life insurance companies need to train their sales
representatives to an adequate standard in competencies of
problem solving, communication, information technology utilization, culture compatibility, emotional intelligence, collective competence and ethics.
Introduction
A number of studies have looked at the relationship between training and productivity
and found evidence of a direct link. Holzer et al. (1993) conducted a survey looking at
how productivity changes across firms were related to changes in training. Bartel
r Chiang Ku Fan, Associate Professor, Department of Risk Management and Insurance, Shih Chien
University, Taipei, Taiwan. Email: [email protected]. Chen-Liang Cheng, Associate Professor,
Department of Risk Management and Insurance, Shih Chien University, Taipei, Taiwan.
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd., 9600 Garsington Road, Oxford OX4 2DQ,
UK and 350 Main St., Malden, MA 02148, USA.
212 International Journal of Training and Development
(1994) studied the link between training and productivity using a sample of approximately 150 firms. Bartel’s study revealed a positive effect of training on productivity.
In addition, according to the research funded by the British Economic & Social
Research Council’s Future of Work Programme, companies implementing training
may be rewarded with greater productivity (Training and Development, 2003a), as well
as solidify their position in a changing and increasingly competitive marketplace.
The financial services industry including banks, insurance and securities usually
face issues of compliance, security and regulation of practice. These issues exert pressure on companies to train their employees to do the right thing (Harris, 2004).
Therefore, human resource managers need to pay more attention to investing in the
training of sales representatives effectively as well as providing the tools that they
need to help businesses be productive (Shephard, 2001). According to the findings of
a survey conducted by the Mellon Financial Corporation in 2003 (Training and Development, 2003b), the training of sales representatives helps improve their productivity.
In recent years, Taiwan has continued its privatization, liberalization and deregulation process (Kwon, 2002). It introduced the Financial Institutions Merger Law in 2000,
the Financial Holding Company Law in 2001 and the Financial Supervisory Board
Law in 2001. These laws established a legal basis for the creation of financial holding
companies that offer banking, insurance, securities and financial services through
their subsidiaries and also permit joint marketing efforts among subsidiaries of
financial holding companies (Kwon, 2002). In 2002, Taiwan became a World Trade
Organization (WTO) member. In response, it was expected that domestic financial
institutions would face strong competition from foreign institutions and, as a result,
trigger a tremendous change in the finance market (Chiu, 2000). At the same time that
business competition was heightened, a lack of training to develop necessary competencies added to the dissatisfaction felt by sales representatives (Myers & Torrington,
2001).
According to a report circulated by the Insurance Institute of Taiwan (2004a), 91 per
cent of life insurance employees were sales representatives. Moreover, a survey of
more than 2300 businesses examining training practices in the USA found that the
training of sales representatives represented approximately 11.3 per cent of the total
number of training hours and accounted for an expenditure of nearly $5.7 billion in
1994 (Gillian, 1995). It might take months, and possibly even years, before a firm is
able to recoup this training investment (Reichheld, 1996). These data imply that training sales representatives may be the most important task in the life insurance industry’s training programme.
The training content delivered to the learners depends on the training goal set by
the trainer (Neo et al., 2003). Often, training goals demand behaviour that learners
are incapable of performing, do not cater to learner interests or may list outcomes
that learners have already attained. As a result, training programmes may be judged
as unsuccessful (Ornstein & Hinkins, 1998).
In the USA, the Life Office Management Association (LOMA) offers a convenient
and affordable training programme that includes 100 courses classified into four categories: (1) life and health insurance, (2) retirement planning, (3) money management
and (4) securities. LOMA is an international institution that focuses on offering training courses to help sales representatives maintain their licence (Donaldson, 2003). The
courses offered by LOMA help sales representatives earn continuing education credits
and eventually renew their licences (Donaldson, 2003). The changing marketplace puts
more responsibility on sales representatives to understand and react to change quickly
and appropriately. Therefore, training needs go beyond taking a seminar or earning
continuing education credits toward sales representatives’ licence renewal (Parmenter,
2004).
Based on the Regulations Governing the Administration of Insurance Solicitors of
Taiwan, life insurance sales representatives have to attend a standard training programme and pass the licence examination before they sell a policy (Insurance Institute
of Taiwan, 2004b). Besides the standard training programme, life insurance companies
in Taiwan also have an obligation to provide additional training programmes for their
Training needs of life insurance sales representatives in Taiwan 213
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
sales representatives. Most of these additional training programmes are imported from
LOMA. Nevertheless, some training problems may emerge. The first problem is that
a needs assessment for life insurance sales representatives might need to be updated
to fit a rapidly changing environment. Second, the imported training courses that a
life insurance company delivers need to be adapted to learner needs and desires and
to accommodate differences between the Taiwanese life insurance environment and
that in America. The purpose of this study is to conduct a needs assessment to identify
the necessary competencies for life insurance sales representatives for the rapidly
changing life insurance environment in Taiwan. This study will be guided by the
following research questions:
1.
2.
According to the Delphi panellists, what competencies are necessary for life insurance sales representatives in Taiwan?
What are the rankings of the necessary competencies for life insurance sales
representatives based upon the opinions of the Delphi panellists?
Literature review
Inancevich (1992) asserted that a needs assessment should present the following: (1)
the analysis of the organization’s needs; (2) the knowledge, skill and ability needs to
perform the job; and (3) the person or jobholder’s needs. Robert (1999) studied the
same concept and found that a needs analysis typically had a twofold focus: organizational analysis and operational analysis. Both of these studies found that organizational analysis was used to analyse the needs of the entire organization now and in
the future, and operational analysis was used to analyse the needs of a specific group
of jobs or positions (Inancevich, 1992; Robert, 1999).
The work environment underwent major changes at the beginning of the twentyfirst century, and the most important changes were driven by corporations’ need to
be more competitive worldwide (Yeatts et al., 2000). Furthermore, flexibility became
the norm in many work environments, replacing the more traditional and routinized
approaches to work. The result was a workplace that required an almost constant
adaptation by employees to achieve increased productivity (Beyerlein & Teal, 1993;
Dychtwald et al., 2004; Fairris, 2002; Feldman & Pentland, 2003; Lawler, 1986; MitchellKetzes, 2003; Yeatts & Hyten, 1998). Atchley (1987, p. 243) defined adaptation as ‘the
process of adjusting oneself, both inwardly and outwardly, to fit situation or environment’. A recent study conducted by Yeatts et al. (2000) constructed a conceptual framework to explain work adaptation, suggesting that each job had a specific knowledge,
skill and ability requirements. The widely accepted conceptualization of work adaptation suggested by them was that employers would redesign the job requirements to
fit the workplace changes or differences.
Changes in the Taiwanese life insurance environment
Liberalization, deregulation, reorganization and globalization
To enable domestic financial institutions to compete with foreign financial institutions
and cope with a competitive financial environment, the Taiwanese government introduced the Financial Institutions Merger Law in 2000, the Financial Holding Company
Law in 2001 and the Financial Supervisory Board Law in 2001 (Bureau of Monetary
Affairs, 2002). As noted above, these laws established a framework for the provision
of banking, insurance, securities and finance services through their subsidiaries by the
creation of financial holding companies. They also permitted joint marketing efforts
among the subsidiaries of a financial holding company (Insurance Institute of Taiwan,
2004b). In order to integrate business and expand financial territories, many financial
institutions, began to search for mergers or acquisitions to increase their competitive
ability (Kwon, 2002). According to the figures produced by the Organisation for Economic Co-operation and Development (OECD) and G7 from 1996 to 2000, the insurance penetration ratio had grown much faster in Taiwan than in the OECD or G7
214 International Journal of Training and Development
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
countries during the period of study (Swiss Re, 2001). This also implied that the
insurance business of Taiwan was an attractive market for the international insurance
companies (Kwon, 2002).
Trend of an aging population
A trend toward an aging population was already evident in the 1970s according to
demographers (Pontremoli, 2002). The Committee of the Domestic Affairs Department
of Taiwan (MOI Statistical Information Service, 2002) concluded that in 2021, people
over the age of 65 will make up 9.86 per cent of the total population. This ratio exceeds
the 7 per cent that the World Health Organization uses to define a society with an
aging population.
Growth of e-commerce
According to Pearson’s (2002) survey, the primary trend in the insurance industry was
technological innovation, which lowered costs, changed the focus of competition and
moved insurers from being risk carriers to providers of comprehensive information.
Using technology to implement customer relationship, management strategies enable
an insurance company to serve its customers efficiently and in turn win long-term
loyalty (Sodano, 2000). Therefore, Stiroh (2000) emphasized that an effective information technology (IT) infrastructure allowed firms to provide new products, reduce
costs and serve existing customers better.
Needs analysis of a life insurance sales representative in Taiwan
Necessary competencies for globalization
The changing nature of work has been shaped by the realities of competing in a global
economy and customer demands for quality and service (Losyk, 1996). Moreover, in
seeking greater flexibility and responsiveness, organizations under globalization move
toward flatter team-based structures, multiskilling and a more diverse workforce
(Dufficy, 2001). This implies that organizations need to hire a diverse spectrum of
people to solve problems with a customer base that is increasingly multicultural and
more global (Copeland, 1989). In addition, globalization induces culture shock in the
workplace (Stromquist, 2002). To minimize culture shock and conflict in conditions of
globalization, the workforce should be able to communicate with competence and
work together to achieve outstanding service (Henderson, 1994; Losyk, 1996).
Necessary competencies for advanced IT
US Labor Secretary Elaine Chao said that high-tech training should be the priority
for the workforce (Vocational Training Newsletter, 2001). Meanwhile, according to a
survey conducted by Glen (2003), the workforce increasingly needs competencies in
the application of IT to satisfy the demands of their jobs. Most of the published
empirical studies (e.g. Brynjolfsson & Hitt, 2000; Dewan & Kraemer, 1998; Hitt et al.,
2002; Kudybs & Diwan, 2002) found significant positive relationships between IT
competency variables and productivity/performance measures. These studies concluded that the Internet unquestionably represented a significant change in the
competitive landscape by offering traditional firms new ways to increase efficiency,
strengthen communication, forge better customer relationships and build stronger
bonds. Employees in insurance companies that were becoming more sophisticated
in the use of the Internet in marketing communication need competence in using
the Internet to market their products and establish customer relationships (Rohm &
Sultan, 2002).
Necessary competencies for an aging population
Pension plans are increasingly required by the rapidly aging population (Pilla, 2003;
Veysey, 2004). As a result, the life insurance industry needs new knowledge and
products designed in relation to pensions to fit this change in demography (Kwon,
2002).
Training needs of life insurance sales representatives in Taiwan 215
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
Necessary competencies for mergers and acquisitions and financial holding companies
As stated, mergers and acquisitions (M&A) and financial holding companies are currently the major reorganization trend in the financial services industry of Taiwan. This
new pattern of competition requires recognition of the importance of consumers and
the necessity to address consumer needs through innovative products (Kamath et al.,
2003). It also calls for providing multiple products and work to create new economic
products and services for consumers (Stiroh, 2000).
Cultural conflict might exist after M&A or an organization joins with a financial
holding company, which may impact upon how a company operates and how employees, customers and other stakeholders interact (Bramson, 2000). As a result, employees
need cultural compatibility competence in their workplace (Bhawuk & Brislin, 2000).
As stated, M&A and financial holding companies often trigger organizational
restructuring or reorganization. This change often affects employees’ motivation and
workplace attitude (Faulkner et al., 2002). Emotional intelligence (EI) is the ability
adequately to recognize and identify one’s own emotional reactions and those of
others (Cherniss & Adler, 2000). EI also involves the ability to manage one’s emotions,
to utilize them to make correct decisions and to behave adequately (Mayer et al., 1998).
Thus, training employees to have EI competence could solve this motivational
problem. Research and practice have demonstrated that EI can be learned (Harvard
Business Review, 2004).
However, Sandberg’s (1994) research found that competence was not constituted in
terms of a specific set of context-free attributes. Hence, in order to become a smarter
workforce, employees need to improve not only what constitutes individual competence but also what constitutes collective competence (Sjostrand, 1985). In other words,
employees with the ability to share experiences and skills from coworkers in the
workplace can improve their performance, and this is the most important feature of
collective competence (Gerber & Lankshear, 2000).
In this rapidly changing environment, traditional training courses may not satisfy
organizational, job and individual needs. The literature review suggests several
necessary competencies: (1) communication; (2) problem solving with a customer
base; (3) using IT; (4) having sufficient knowledge of various financial products to
offer diversified financial services; (5) culture compatibility; (6) sufficient EI; and (7)
collective competence, all of which are necessary competencies for life insurance sales
representatives in these circumstances.
Popular training courses and education programmes in Taiwanese life
insurance companies
LOMA
LOMA is an international association through which more than 1200 insurance
and financial services companies from over 80 countries engage in research and
educational activities to improve the operation of financial services institutions.
LOMA members are involved in areas of financial services such as life and health
insurance, managed care, annuities, pensions, banking, bank assurance and securities. LOMA serves a large and influential group of companies. For example,
LOMA’s US member companies alone account for approximately 95 per cent of
the more than $15 trillion worth of life insurance in force in the USA in 2004
(LOMA, 2005).
The mission of LOMA’s Education and Training Division is to provide companies
in the financial services industry with a quality education to meet their human
resources development needs (LOMA Education and Training Catalog, 2005).
LOMA course offerings and education programmes in Taiwan
As stated in the introductory section, most of the Taiwanese life insurance companies
adopt LOMA’s training materials. Table 1 shows the LOMA course offerings and
education programmes in Taiwan (LOMA Education and Training Catalog in Chinese
Version, 2005). It should be noted that this table reports no differences in LOMA course
216 International Journal of Training and Development
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
Table 1: The LOMA course offerings and education programmes in Taiwan and the United
States
Courses and programmes
Course offerings by subject area
Annuities
Accounting & Finance
Compliance & Legal
Customer Service
Workplace Skills
Financial Services
Management Operations
Life & Health Insurance
Product Marketing
Property & Casualty Insurance
Education programmes
Financial Services Institute
Life Management Institute
Customer Service
Annuity Products and Administration
Insurance Agency Administration
Insurance Accounting and Finance
Insurance Regulatory Compliance
Reinsurance Administration
Bank Insurance Compliance
Underwriting Life and Health Insurance
Taiwan
United States
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
✓
LOMA = Life Office Management Association.
offerings and education programmes between Taiwan and the United States (LOMA
Education and Training Catalog, 2005).
From Table 1, it can be inferred that the mission of LOMA’s education and training
is to provide companies in the financial services industry with quality education to
meet the human resources development needs, and that includes improving on their
employees’ ability to understand customers’ needs and providing diversified financial
services.
Methodology
A mixed-method approach, which can facilitate explanation and prediction and
develop a more holistic view (Jick, 1979; Perry et al., 1999), was employed. Qualitative
data from interviews, along with quantitative data, were used to help rank the necessary competencies and to interpret results.
A modified Delphi research technique was used. Research related to Delphi studies
describes the method as: (1) an effective process in allowing a group of individuals to
deal with complex issues and concepts (Linstone & Turoff, 1979); (2) useful to obtain
judgments that may inform planning, problem solving and the overall decision making (Dunham, 1998; Masini, 1993); and (3) helpful to provide insights into possible
problem solutions (Scott & Walter, 2003). The Delphi study methodology collects and
brings together the ideas of the panellists on a given subject.
Participants
The Delphi panel (n = 10) was selected with a purposive sampling of people who have
a known involvement or expertise in life insurance sales training. Purposive sampling
Training needs of life insurance sales representatives in Taiwan 217
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
is mainly used for opinion surveys (Singh & Chaudhary, 1986; Williams, 1978). For
this study, participants were required to be in a management role and have knowledge
of education or training development in sales, especially in life insurance sales. Participants were also identified based on their publications in practitioner and academic
journals regarding insurance salesforce training. Telephone interviews were conducted with 10 Delphi panel participants, five from model life insurance companies
in Taiwan, five from the Department of Insurance and Risk Management at two
universities.
Data collection and instrumentation
The Delphi panel interview protocol was developed based on the literature review.
The interviews explored more fully the perceptions of experts about the necessary
competencies for life insurance sales representatives. The Delphi panel interview questions consisted of a set of questions carefully worded and arranged for the purpose of
taking each respondent through the same sequence and asking each respondent the
same questions with essentially the same words (Johnson & Christensen, 2000).
Research indicated that three iterations are typically sufficient to identify points of
consensus and systematic points of difference, and that more iterations can bore
panellists, thus reducing the validity of findings (Dietz, 1987; Erffmeyer et al., 1986).
Thus, three rounds were used in this study. The possible necessary competencies for
life insurance sales representatives were first derived from the literature and then
evaluated by a Delphi study panel in three iterations. According to Johnson and
Christensen (2000), cross-checking information and conclusions through the use of
multiple procedures or source strategies promotes a qualitative research validity.
Similar Delphi panel interview questions were used in the first, second and third
round of Delphi study procedures. This minimized variation in the questions posed
and improved the reliability of the interviews. The instruments used in this Delphi
study minimized the variation of the questions posed to the interviewees.
Data analysis
The qualitative data analysis was achieved by note taking, transcribing, reading,
rereading and coding. The data were coded relative to the themes explored
through the questions asked in the final round of the interviews. The Wilcoxon
Signed Rank tests were used to rank the necessary competencies for life insurance
sales representatives.
Results
Delphi panellists were asked to justify their answers to questions identifying necessary
competencies and to rate their level of agreement regarding necessary competencies.
The results are listed in Table 2. These qualitative responses helped to elaborate the
quantitative responses to the standardized questions, and qualitative themes were
indicative of opinions raised by a large majority of the Delphi panellists.
Nine Delphi panellists strongly agreed that solving problems with a customer base
was a necessary competency for life insurance sales representatives. The following
quote, taken from a 35-year-old life insurance academic woman, illustrated the importance of this competency: ‘Customers will be satisfied if the problem can be resolved
immediately’.
Six Delphi panellists strongly agreed that communication was a necessary competency. One of the Delphi panellists, a 43-year-old man who had designed several
training programmes for many life insurance companies in Taiwan, stated that
‘[t]hrough appropriate communication, life insurance sales representatives can realize
the customer’s needs’.
Eight Delphi panellists either strongly agreed or agreed that using IT was a necessary competency for life insurance sales representatives. For example, a 48-year-old
218 International Journal of Training and Development
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
Training needs of life insurance sales representatives in Taiwan 219
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
80%
n=8
60%
n=6
30%
n=3
20%
n=2
10%
n=1
80%
n=8
50%
n=5
10%
n=1
20%
n=2
40%
n=4
R2
SA
90%
n=9
60%
n=6
30%
n=3
20%
n=2
20%
n=2
80%
n=8
50%
n=5
10%
n=1
20%
n=2
40%
n=4
R3
20%
n=2
40%
n=4
50%
n=5
80%
n=8
60%
n=6
20%
n=2
50%
n=5
90%
n=9
0%
n=0
0%
n=0
R2
A
10%
n=1
40%
n=4
50%
n=5
80%
n=8
50%
n=5
20%
n=2
50%
n=5
90%
n=9
0%
n=0
0%
n=0
R3
0%
n=0
0%
n=0
20%
n=2
0%
n=0
30%
n=3
0%
n=0
0%
n=0
0%
n=0
40%
n=4
60%
n=6
R2
UD
0%
n=0
0%
n=0
20%
n=2
0%
n=0
30%
n=3
0%
n=0
0%
n=0
0%
n=0
40%
n=4
60%
n=6
R3
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
40%
n=4
0%
n=0
R2
Attitude toward necessary competencies*
D
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
40%
n=4
0%
n=0
R3
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
R2
* Five attitudes toward necessary competencies: Strongly Agree (SA); Agree (A); Undecided (UD); Disagree (D); and Strongly Disagree (SD).
IT = information technology.
EI = emotional intelligence.
Understanding customer needs
Professional knowledge
Ethics
Collective competence
EI
Culture compatibility
Diversified financial service
Using IT
Communication
Problem solving
Necessary competencies
Table 2: Descriptive statistics of attitudes toward each necessary competency at interview Rounds 2 and 3
SD
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
0%
n=0
R3
man who is a human resources manager of a model life insurance company explained,
‘Life insurance sales representatives can improve customer service by using information technology efficiently’.
Ten Delphi panellists either strongly agreed or agreed that the competency of offering a diversified financial service was a necessary one for life insurance sales representatives. One of the insurance scholars maintained, ‘Due to the trend of setting up
a financial holding company in the Taiwan finance market, life insurance sales representatives need to understand all related financial products to facilitate their one-stopshopping service’.
Three Delphi panellists were undecided, and at least seven agreed that culture
compatibility was a necessary competency for life insurance sales representatives. A
43-year-old woman who is the chair of the education and training department of the
Insurance Institution of the Republic of China stated, ‘Life insurance sales representatives need culture compatibility in the work place; therefore a cooperative task target
can be set up easily’.
Eight Delphi panellists strongly agreed that EI was a necessary competency for life
insurance sales representatives. A 48-year-old insurance academic said, ‘Life insurance
sales representatives cannot negate themselves just because of customers’ rejection to
buy insurance’.
Collective competence was rated as strongly agreed by five Delphi panellists as a
necessary competency. A former chair of the insurance department in a university
emphasized, ‘Learning from co-workers can make tasks easier to accomplish’.
The original seven necessary competencies initially derived from the literature
survey in this study were generally all supported by the Delphi panellists. Moreover, another three necessary competencies were proposed by the Delphi panellists:
(1) ethics; (2) professional insurance knowledge; and (3) understanding customer
needs.
Two response themes related to the Delphi panellists’ perceptions about ethics for
life insurance sales representatives emerged: (1) the ‘utmost good faith’ nature of
insurance contracts and ethics and (2) trust and ethics. The following quote by a 43year-old workforce training expert (Delphi panellist) in a life insurance company
illustrated one of the important themes: ‘Insurance is an utmost good faith contract.
Ethics are essential to implement a contract’. A 46-year-old senior marketing workforce
trainer from a model life insurance company in Taiwan stated, ‘Customers trust ethical
life insurance sales representatives with their insurance’.
The themes identified by this study with respect to the competency of professional
insurance knowledge included the following: (1) identifying risk based upon knowledge of risk management and (2) proper coverage recommended on the basis of
sufficient insurance knowledge. One male Delphi panellist from the insurance department of a university stated, ‘Without the concept of risk management, a life insurance
sales representative cannot identify risks for their customers’. Another Delphi panellist
from a model life insurance company agreed by stating, ‘If life insurance sales representatives cannot identify risk for their customers, a proper and full coverage for a
client would not be designed’.
Two themes related to the competency of understanding customer needs emerged:
(1) the customer’s need is the core of a product and (2) satisfying customer need is the
primary task of sales representatives. A 40-year-old male Delphi panelist from a model
life insurance company volunteered the following:
Consumer need is the core of a product. Customers need an insurance product which can cover
their damage. Therefore, customers are not going to buy insurance without proper coverage for
them.
Another Delphi panellist with both insurance and marketing degrees stated, ‘How to
identify the customer’s insurance need is, of course, the primary task for life insurance
sales representatives, satisfying their customers’.
As mentioned in the methodology, the issues of divergence and convergence of
opinions are fundamental to a Delphi study. Although some deviant responses
220 International Journal of Training and Development
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
remained, stability of opinion emerged between rounds (see Table 2). In the second
round interview, the Delphi panellists’ attitude toward ‘problem solving’ was 80 per
cent (n = 8) for Strongly Agree (SA) and 20 per cent (n = 2) for Agree (A). However, in
the third round interview, the percentages were 90 per cent (n = 9) for SA and 10 per
cent (n = 1) for A. Moreover, in the second round interview, the percentage of Delphi
panellists’ attitude toward ‘culture compatibility’ at the levels of SA and A were 10
per cent (n = 1) and 60 per cent (n = 6) respectively. However, in the third round
interview, the percentages were 20 per cent (n = 2) for SA and 50 per cent (n = 5) for A.
The Delphi panellists were asked to rank the necessary competencies, ranging from
Strongly Agree (SA) (5) to Strongly Disagree (SD) (1). As Table 3 shows, ‘problem
solving’, ‘communication’, ‘EI’ and ‘collective competence’ were ranked SA by most
of the Delphi panellists. In contrast, most of the Delphi panellists ranked ‘professional
knowledge’ and ‘understand customer needs’ at the levels of Undecided (U) or
Disagree (D).
Results attained from the use of the Wilcoxon Signed Ranks test in testing the
comparison of necessary competencies, which Delphi panellists stated in the third
round interview, are shown in Table 4. The test statistics were based on the ranks of
the absolute value difference between the two variables. Ten necessary competencies
were grouped into 45 different pairs in order to test for their significance. A two-tailed
test at 0.05 significant level was used to compare the data. Some necessary competencies were shown to be significantly different from others. This meant that the null
hypothesis that those necessary competencies had the same distribution could be
rejected.
Findings and recommendations
Findings
After three rounds of Delphi panellist interviews, no necessary competence suggested
by the literature was replaced. Moreover, Delphi panellists developed three additional
necessary competencies for life insurance sales representatives: (1) ethics, (2) professional knowledge and (3) understanding customer needs. Almost 80 per cent of insurance is sold directly by sales representatives employed by a life insurance company
in Taiwan compared to more than 80 per cent of insurance sold by an agency or broker
in the USA (Insurance Institute of Taiwan, 2004b). Using a professional insurance
knowledge to design full coverage for customers and identifying the real need of
customers were competencies ignored by life insurance sales representatives before
the Taiwan life insurance market changed through globalization, liberalization and
Table 3: Descriptive statistics of the third round interview
Necessary competency
n
Mean
SD
Min
Max
Problem solving
Communication
Using IT
Diversified financial service
Culture compatibility
EI
Collective competence
Ethics
Professional knowledge
Understandinig customer needs
10
10
10
10
10
10
10
10
10
10
4.90
4.60
4.10
4.20
3.90
4.80
4.50
4.10
3.00
3.80
0.316
0.516
0.738
0.422
0.738
0.422
0.527
0.316
1.155
1.033
4
4
3
4
3
4
4
4
2
3
5
5
5
5
5
5
5
5
5
5
Note: Strongly Agree = 5; Agree = 4; Undecided = 3; Disagree = 2; Strongly Disagree = 1.
IT = information technology.
EI = emotional intelligence.
Training needs of life insurance sales representatives in Taiwan 221
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
Table 4: Results from the use of the Wilcoxon Signed Ranks test in testing the comparison of
necessary competencies
Necessary competencies in pair comparison
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
Communication – problem solving
Using IT – problem solving
Diversified financial service – problem solving
Culture compatibility – problem solving
EI – problem solving
Collective competence – problem solving
Ethics – problem solving
Professional knowledge – problem solving
Understand customer needs – problem solving
Using IT – communication
Diversified financial service – communication
Culture compatibility – communication
EI – communication
Collective competence – communication
Ethics – communication
Professional knowledge – communication
Understand customer needs – communication
Diversified financial service – using IT
Culture compatibility – using IT
EI – using IT
Collective competence – using IT
Ethics – using IT
Professional knowledge – using IT
Understand customer needs – using IT
Culture compatibility – diversified financial service
EI – diversified financial service
Collective competence – diversified financial service
Ethics – diversified financial service
Professional knowledge – diversified financial service
Understand customer needs – diversified financial
service
EI – culture compatibility
Collective competence – culture compatibility
Ethics – culture compatibility
Professional knowledge – culture compatibility
Understand customer needs – culture compatibility
Collective competence – EI
Ethics – EI
Professional knowledge – EI
Understand customer needs – EI
Ethics – collective competence
Professional knowledge – collective competence
Understand customer needs – collective competence
Professional knowledge – ethics
Understanding customer needs – ethics
Understanding customer needs – professional
knowledge
a Based on positive ranks.
b Based on negative ranks.
c The sum of negative ranks equals the sum of positive ranks.
* p < 0.05.
EI = emotional intelligence.
IT = information technology.
222 International Journal of Training and Development
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
Z
Sig.
(two-tailed)
−1.342a
−2.271a
−2.646a
−2.646a
−0.577a
−1.633a
−2.828a
−2.565a
−2.349a
−2.236a
−2.000a
−1.823a
−1.000b
−0.577a
−2.236a
−2.636a
−1.994a
−0.447b
−0.632a
−2.070b
−1.414b
0.000c
−2.309a
−0.791a
−1.134a
−2.449b
−1.732b
−1.000a
−2.360a
−1.155a
0.180
0.023*
0.008*
0.008*
0.564
0.102
0.005*
0.010*
0.019*
0.025*
0.046*
0.068
0.317
0.564
0.025*
0.008*
0.046*
0.655
0.527
0.038*
0.157
1.000
0.021*
0.429
0.257
0.014*
0.083
0.317
0.018*
0.248
−2.251b
−1.656b
−1.000b
−1.983a
−0.144a
−1.732a
−2.646a
−2.602a
−2.271a
−2.000a
−2.570a
−2.333a
−2.373a
−1.000a
−1.651b
0.024*
0.098
0.317
0.047*
0.885
0.083
0.008*
0.009*
0.023*
0.046*
0.010*
0.020*
0.018*
0.317
0.099
deregulation. This might explain why three additional necessary competencies were
recommended by the Delphi panellists but were not identified in the literature. In other
words, compared to the liberalized and deregulated insurance markets, the LOMA’s
training course offerings and education programmes are especially valuable for
Taiwan life insurance sales representatives.
The mission of LOMA’s education and training design is to improve employees’
knowledge of the financial services industry so that they would have the abilities
of understanding customers’ needs and providing diversified financial services.
However, this study found problem solving, communication, using IT, culture compatibility, EI, collective competence and ethics are also necessary competencies for life
insurance sales representatives in Taiwan.
Although these 10 necessary competencies were all confirmed and agreed upon by
the Delphi panellists, this study still found some necessary competencies to be significantly different in the importance attached to them by Delphi panellists. Referring
to the descriptive statistic data and the Wilcoxon Signed Ranks test, overall results
could be summarized by their direction of dominance. Delphi panellists rated ‘problem solving’ and ‘EI’ at a higher level of agreement than those of other necessary
competencies. As compared with other necessary competencies, ‘professional knowledge’ and ‘understand customer needs’ were rated at the lowest level of agreement
by Delphi panellists, whereas professional knowledge at 3.0 on a 5-point scale equated
to Delphi panellists being undecided about its importance.
Recommendations
To date, a rapid change has occurred in the life insurance environment in USA and
Taiwan. According to the literature review, major changes that are common to the
Taiwan life insurance environment and to that of USA are globalization, aging population and growth of e-commerce. For the most part, both American life insurance
companies and Taiwanese ones implement the same LOMA education and training
plans that focus on improving sales representatives’ knowledge of various financial
products and ways of marketing. The implication is that the current LOMA education
and training programmes or courses conducted in both countries have deficiencies
and cannot bring the life insurance sales representatives to a successful performance
in the rapidly changing environment. Besides knowledge of various financial products
and marketing, this study suggests that life insurance companies in both countries
should design a training plan that can ensure that their sales representatives have
competencies of problem solving, communication, using IT, culture compatibility, EI,
collective competence and ethics.
Referring to the results of the qualitative and quantitative research methods
employed in this study, the 10 necessary competencies are all important for Taiwan
life insurance sales representatives from the viewpoint of a long-term training plan.
In addition, life insurance companies in Taiwan can use the priority of the training
needs identified in this study in their short-term planning while designing training
programmes for their sales representatives within the constraints of limited time and
budgets.
Adding a follow-up attitude survey relating to these 10 necessary competencies after
the Delphi study would be helpful to the life insurance companies. The attitude survey
approach could serve to identify more suitable training needs for life insurance sales
representatives.
Further research should be conducted into the interrelation of the competencies
found in this study. A necessary competency includes a cluster of interrelated competencies (Field, 1994). Based upon these interrelated competencies, human resources
managers could design training courses for their life insurance sales representatives.
The final recommendation is that this study should be replicated in industries other
than the life insurance industry. During the process of reviewing the literature, numerous references indicated that banks and securities companies also sell life insurance
(after deregulation). Thus, banks and securities companies are in the same rapidly
Training needs of life insurance sales representatives in Taiwan 223
© 2006 The Authors. Journal compilation © 2006 Blackwell Publishing Ltd.
changing environment as life insurance companies. Identifying necessary competencies would be helpful in improving their training efficiency.
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