ST2 - Booklet 1.txt

1. Distribution channel management

2. Customer relationship management

1. Commission / other remuneration

2. Surrender penalty

3. Suitable management strategy to avoid any identified systematic lapse / surrender trend continuing

4. Monitor # of quotations vs. business acquired to control acquisition costs.

1. Meet p/h needs

2. Maintain / improve admin quality

• 1. contain expenses + commissions into prem / charge rate policy loadings
• 2. regularly monitoring actual expenses with the policy loadings

3. compare expense ratios with competitors'

4. control expenses by reducing current cost base to be within policy loadings

5. regularly monitoring commissions by a) product line b) distribution channel c) specific sales person / broker

• 1. insufficient benefit (a) inflation (b) investment performance.
• NP - (a) not ok; (b) N/A. WP - (a) & (b) ok becoz of future bonuses. UL - (a) OK (b) Not ok.

• 2. insurer insolvency
• NP - Not ok. WP - Ok becoz of bonuses. UL - Not ok.

• 3. cannot maintain premium
• NP & WP - Not ok. UL - Ok.

• 4. inflexible product (a) cannot keep pace with disposable income (b) non-changeable benefits
• NP & WP - Not ok. UL - Ok.