Becoming An Insurance Broker: Philippines Edition

If you're interested in becoming an insurance broker in the Philippines, there are a few key steps you need to take. First, you'll need to obtain a college degree, preferably in a field related to insurance or business. While it's not mandatory to have a degree, it can give you a competitive edge and improve your employment prospects. The next step is to gain some experience in insurance or sales, with at least five to ten years being ideal. Alternatively, you can associate yourself with a reputable institution like the Insurance Institute for Asia and the Pacific to make up for any lack of experience. The third step is to obtain your license by passing the Insurance Commission exam, which will test your knowledge of insurance policies and regulations. After that, you'll need to invest a significant amount of capital to set up your brokerage business, typically around 20 million pesos. Once you have your license and capital, you can start networking and building relationships with insurance companies and potential clients. It's also essential to develop strong communication and interpersonal skills, as brokers need to understand their clients' needs and fears to offer them the best insurance solutions.

Get a college degree

While a college degree is not strictly necessary to become an insurance broker in the Philippines, it can be beneficial. A degree provides a solid background of knowledge, enhances your resume, and may increase your employment opportunities.

When it comes to choosing a degree, the good news is that any field will do. Whether you're interested in astrophysics or underwater basket weaving, a degree will show that you have the intellectual prowess to navigate the complex world of insurance. However, if you want a degree that is more closely related to the field of insurance, you might consider pursuing a degree in business administration or communications. Some educational institutions even offer degrees specifically in insurance and risk management, although these are less common.

During your degree, it is a good idea to gain some practical experience through an internship with an insurance firm. This will allow you to apply the knowledge you're gaining in a professional environment and give you a head start in understanding the intricacies of the insurance industry. If your chosen degree program doesn't offer internships, you can always try to arrange one yourself.

In addition to the knowledge and experience gained through a college degree, don't underestimate the value of the soft skills you'll develop. Insurance brokers need to be excellent communicators, analytical thinkers, and problem solvers. They must be able to analyze their client's needs, present different options, and guide their clients in making informed decisions. Strong interpersonal skills are also crucial, as brokers need to build trust and maintain relationships with their clients.

While a college degree is not a mandatory requirement, it can certainly give you a competitive edge in the insurance industry and set you up for a successful career as an insurance broker.

Gain experience in insurance or sales

Gaining experience in insurance or sales is a crucial step in becoming an insurance broker in the Philippines. While the specific requirements may vary, having a solid background in the field can set you up for success. Here's a detailed guide to help you navigate this important aspect:

Understanding the Requirements:

The Insurance Commission in the Philippines sets the standards for becoming an insurance broker. According to their guidelines, a soliciting official or broker must have a minimum of ten years of experience in a relevant field. This can include working as a sales or underwriting executive in an insurance brokerage firm or insurance company, with a managerial-level position. It's important to note that this requirement can be reduced to five years if you have certain qualifications, such as an associateship from the Insurance Institute for Asia and the Pacific (IIAP) or a similar recognized institution.

Building Your Experience:

Now, let's delve into the practical steps to gain that valuable experience:

• Insurance Industry Experience: Aim to secure a position in the insurance industry, specifically in sales or underwriting. Start by applying for entry-level positions within insurance brokerage firms or insurance companies. These roles will provide you with the foundational knowledge and skills needed to advance your career.
• Sales and Customer Interaction: Focus on developing your sales abilities and customer interaction skills. Insurance brokers need to be adept at understanding client needs and effectively selling insurance products. Consider roles that involve direct sales, customer service, or account management to build your confidence and expertise in this area.
• Managerial Experience: Strive for managerial positions within the insurance industry. Not only will this help you meet the experience requirements, but it will also equip you with valuable leadership skills. Look for opportunities to take on additional responsibilities and showcase your ability to manage a team effectively.
• Industry Connections: As you gain experience, focus on building a strong professional network within the insurance industry. Attend industry events, join relevant associations, and connect with peers and mentors. These connections can open doors to new opportunities and enhance your overall industry knowledge.
• Continuing Education: While gaining practical experience, don't neglect your educational development. Consider enrolling in insurance-related courses, workshops, or even pursuing a degree in a relevant field. This will demonstrate your commitment to the industry and enhance your theoretical understanding of insurance principles.
• Internships: If you're new to the industry, consider exploring internship opportunities within insurance firms. Internships can provide a great platform to learn the ropes, develop practical skills, and make valuable connections. Many educational institutions also offer internship programs that can give you a head start in gaining experience.

Remember, the key to gaining valuable experience is to be proactive in your career pursuits. Seek out opportunities, continuously learn, and don't be afraid to take on new challenges. By immersing yourself in the insurance or sales industry, you'll be well on your way to becoming a successful insurance broker in the Philippines.

Pass the Insurance Commission exam

To pass the Insurance Commission exam, you'll need to prepare thoroughly. While the exam is not known to be exceptionally difficult, it's important to be well-versed in the material. The exam will test your knowledge of insurance policies, so make sure you study and understand the different types of insurance available, including casualty, property, liability, accident, health, life, disability, commercial, automotive, home, and pet insurance.

The exam is typically administered digitally, with multiple-choice questions. To register for the exam, you'll need to meet the pre-licensing requirements, which include a minimum number of hours of coursework in specific insurance fields. Some states may exempt individuals from these requirements if they can provide evidence of relevant work experience.

Once you've fulfilled the necessary pre-exam requirements, you can schedule your exam and pay the associated fee. Most states offer short-term courses to help you prepare, and you can also find study materials and practice tests online. It's important to note that you may need to provide proof of completing the pre-licensing requirements before being allowed to take the exam.

On the day of the exam, arrive at the designated testing site at your scheduled time. Bring any necessary identification and required materials. During the exam, carefully read each question and answer choice, taking your time to select the best answer. Remember, if you don't pass on your first attempt, you can always reschedule and try again.

Passing the Insurance Commission exam is a crucial step towards obtaining your insurance broker license in the Philippines, so make sure you give yourself the best chance of success by preparing thoroughly and staying focused during the exam.

Meet capital requirements

To become an insurance broker in the Philippines, you need to meet the capital requirements. The Insurance Broker must comply with the minimum paid-up capital of PHP 20 million. If you want to be both an insurance and reinsurance broker, you will need PHP 50 million in capital. A reinsurance broker requires a minimum paid-up capital of PHP 500,000.

In addition to the capital requirements, you will need to submit a range of documents as part of your application. This includes a certified true copy of your Certificate of Registration, a Tax Identification Number, a Value Added Tax number, and a bank account statement. You will also need to provide an inventory of equipment, a plantilla of personnel, and a list of insurance companies you plan to work with.

The Insurance Commission will also require you to submit a pre-operational balance sheet, a surety bond worth PHP500,000, and Errors and Omission Policies (Professional Indemnity) worth PHP1,000,000.

Meeting these capital requirements and providing the necessary documentation are essential steps in obtaining your insurance broker license in the Philippines.

Develop sales and networking skills

Developing sales and networking skills is crucial for insurance brokers in the Philippines. Here are some strategies to enhance these skills:

Sales Skills:

• Client-First Approach: Successful brokers put the needs of their clients ahead of their own. By listening attentively and building trust, they can offer products that align with their clients' interests, even if it means earning a lower commission.
• Customer Service Excellence: Respond promptly to client inquiries and ensure reliability. Be accessible and provide reassurance when clients need it.
• Emotional Intelligence: Cultivate the ability to empathize with clients and understand their fears and financial realities. This helps in building trust and tailoring solutions accordingly.
• Energy and Persistence: Maintain a positive and enthusiastic attitude. Insurance sales can be challenging, so it's important to stay persistent in the face of rejection.
• Honesty and Integrity: Being truthful and transparent earns clients' respect and trust, leading to long-term business relationships.

Networking Skills:

• Industry Connections: Attend industry events, conferences, and networking sessions to meet potential clients and partners.
• Social Butterfly: Be sociable and build relationships with people in and outside the insurance industry. You never know who might lead you to your next client.
• Online Presence: Establish a professional online presence through platforms like LinkedIn and relevant industry groups. Engage in discussions and showcase your expertise to attract potential clients.
• Referrals and Recommendations: Provide exceptional service to your existing clients to earn referrals and positive testimonials, which can help expand your network.
• Community Involvement: Participate in community events and activities to increase your visibility and establish yourself as a trusted member of the community.

Remember, sales and networking skills are essential for building a successful insurance brokerage business in the Philippines. By focusing on the client's needs and cultivating a strong network, you'll be well on your way to establishing a thriving career in this field.

Frequently asked questions