It’s business unusual

  • Business
  • Saturday, 22 Feb 2003



HE calls it Business Unusual. Loh Chaw Mun, a 16-year veteran in the life insurance business, is on a mission to re-invent the way the domestic financial services industry is run. 

Loh wants to provide support services to the very industry in which he qualified for the Million Dollar Round Table (MDRT-USA) three times.  

He is offering – recruitment services, coaching, training; and via his website, ( software applications, a directory of financial planners, and website design – an area not yet touched by financial planners.  

Why the sudden about turn? “Very simple,” he answers. “You ask them (agency managers). They would like to focus on marketing. If they do too much of admin (administrative) work – recruiting, software, web design – they will have no time to do marketing.  

“So I'm telling them, why don’t you focus on marketing, which is your bread and butter, and leave your recruiting to me. They should focus on what they do best. Recruiting takes up a lot of time.”  

Loh has talked to some agency leaders and finds they are in agreement in principle; what needs to be discussed further is the recruitment fee. He quotes a fee of RM800 per candidate in his website. He feels it is a reasonable figure because the agency will override indefinitely on the person recruited, and more than recover the sum. 

But Loh is going slow on that aspect at the moment as, right now, he has his hands full between coaching and training.  

In fact, that was his original intention. Early last year, he had wanted to start a financial planning practice – a company, to be registered under proposed legislation governing the financial planning business – but because the legislative framework was yet to be put in place, he decided to convert his website into support services.  

“I now find that providing support services and products is even more interesting,” says Loh, who has since cut all links with his former principals so as to be 100 per cent independent and impartial. Most of his career life had been with Great Eastern, with a short stint at Aetna (since renamed ING). 

To Loh, being truly independent and impartial is important because he plans to offer financial planning on his website subsequently, but he is still undecided whether to offer a fee-based service or a free service.  

Well, it will not exactly be free – there is no such thing as a free lunch. The visitor making use of such free services can expect a call from a financial planner or two; and there are no prizes for guessing who would have sold them the visitor's details. 

Says Loh: “Financial service should focus on service and giving solutions. I tell you, you are short of maybe half a million dollars of protection or investment. You go and shop around. If, I also sell products, I can be biased.” 

He cautions that some financial products in the market today can vary by as much as 30 per cent for the same amount of investment put in, or premium paid. 

In the US, fee-based financial planning is catching up very fast, Loh notes. There are still some who offer their services based on commission, but they have to declare their interest to the client. In Malaysia, most, if not all, financial planners make a living through product commission. 

He concedes it will not be easy separating financial planning from sales products. But he believes his strategy of offering a financial planners directory on his website will give the customer freedom of choice. 

One push factor that led to Loh creating his website was his desire to provide a common meeting place for the various players in the financial services community – Namlifa (the National Association of Malaysian Life Insurance and Finance Advisers), the Financial Planning Association of Malaysia and the Chartered Life Planner Association.  

“The community is very fragmented,” laments Loh. “It's the Asian mentality ? being very protective. But in the Internet world you cannot hide. So, I am inviting all the various players in the industry to register at” 

And Loh intends to focus his efforts on the directory, because this is where he sees a big future. “If I have a database of 20,000-30,000 agents and planners in the directory, I can command a lot of revenue from advertising,” Loh reasons. “And that is virtually borderless. Anyone can come in.  

“For the time being, I have linked up with some affiliate programmes. But later on I don’t want affiliates. Any company that wants to put a panel there they will have to pay. The calling price right now, if I am not wrong, is RM5,000 to RM10,000 per month for one panel.  

“That’s where revenue will be generated. That’s why now I need to expose the website to get the eyeballs. Eventually I will advertise in the media to drive traffic to the site ? very surprisingly, a lot (of traffic) today comes from Indonesia, and even the US. Once I build up the clicks, and also the page views, I can sell advertisements. And this is very focussed marketing – financial services.”  

Among the potential advertisers he sees are the computer companies –”because the financial services segment uses a lot of computers” – life insurance companies, unit trust companies, general insurance companies, financial companies, and the commercial banks.  

Loh was drawn to the insurance business because of the huge potential it offered then. “I found that less than 10 per cent or 15 per cent of the population (16 years ago) was insured. That means 85 per cent or 90 per cent was not insured. That was a big market. The opportunities were aplenty,” he recalls.  

“At the same time in selling insurance you are not just selling a product, you are selling a solution; a solution to families that really need protection for their breadwinner.” 

That was to be the beginning of a very fulfilling career, which included being promoted to the highest rank of the agency hierarchy in less than five years, and being named “Agent of the Year 1990” by the National Association of Malaysian Life Insurance Agents (Namlia). 

Loh also frequently speaks at seminars and congresses organised by life insurance companies and associations, his talks focusing on how information communications technology (ICT) can be used to increase agent productivity. 

“I realised that agency leaders or even financial planners need a website as a point of contact,” says Loh. With a website they become available 24 hours a day, seven days a week. I also find there's a vacuum in the life insurance industry or financial services industry for support services.  

“Many agency managers are information technology (IT) illiterate. And that’s when I thought, why not provide them such services?” 

Loh himself was IT illiterate till lately only. “I just fell in love with IT and the Internet,” he says. Having no formal training in computer science, he learned how to create a website through trial and error, by being very hands-on.  

“Building a website is just like building a house,” says Loh. “You do it brick by brick, wall by wall. In the beginning you only see bricks, then slowly you see a wall and much later on only do you see a house. But eventually you still have to put in furniture, fittings, and so on. I would say right now my website is only 85 per cent complete.  

“In the IT world the first mover advantage is very important. And also, on the Internet whether you are David or Goliath makes no difference. It is a level playing field. For example, this online directory, I suppose a lot of people thought of it before. But they didn't put their idea into action.” 

The fact that Loh operates from Klang, and not Kuala Lumpur, lends credence to the truism that the Internet levels the playing field. 

Says Loh: “It is not how big or small the place. We call this gentleman Ben Felman the greatest insurance salesman in the world. He is from a small town, not a big city.  

“It depends on how you market yourself, not how big a city or how small a town you come from. The moment you move to the Internet, you become borderless. Nobody knows if you are from a kampung or an urban city.” 

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