Skip navigation

Manulife's army of agents on the march for middle class

Foreign insurers compete for savings-mad consumers

Globe and Mail Update

BEIJING — At 8:30 a.m. in a Beijing office building, 60 young men and women spring to their feet and break into song.''In success or setback, China-Manulife will always be with you,'' they chime in Mandarin Chinese.

"With courage to bear the burden

Of providing care and concern."

It's an up-tempo anthem, of the sort soldiers might sing as they stride into battle. And it's appropriate since these are foot soldiers of Manulife Financial Corp.'s life insurance sales army as it marches across China.

On weekday mornings, these "high-profile agents" meet for an hour of team-building, inspiration and role playing. They can probably use the motivation. Most are in their 20s, with a university education, and they are expected to build a clientele from among their friends and relatives. After they've put the touch on that group, they are told to approach strangers on elevators, in the street and on buses.

China's insurance market is booming, and Toronto-based Manulife has made a big bet that a young, hungry sales force is the key to success.

Manulife first came to the mainland eight years ago, through a joint venture with Sinochem, a state-owned trading company.

Shanghai was the initial beachhead, and Manulife-Sinochem Life Insurance Co. now holds 8 per cent of that market, ranking it No. 4 among insurers and No. 2 among foreign firms in the city. Over the past 18 months, it has launched new offices in two other coastal cities, Guangzhou and Beijing, and recently acquired a licence for a fourth, Ningbo.

But the battle really heats up next year, when the doors are flung open nationwide to foreign insurers, ending the plodding and politically tinged city-by-city licensing process.

The big prize is a middle class estimated at 200 million strong and growing quickly. As this group has emerged, the life insurance industry, which didn't exist 25 years ago, has taken off -- growing at an average 30 per cent a year for the past decade. It's now bigger than Canada's, and still has only 3.4-per-cent market penetration, according to a study by management consultants McKinsey & Co.

Most alluring is the mindset of these potential customers. The average Chinese wage earner saves more than 40 per cent of his or her income -- a staggering proportion that reflects both cultural values and the recent deterioration of the public pension system. The Chinese don't have a lot of savings options beyond low-yielding bank accounts, which tends to tilt the life insurance product mix toward savings rather than pure protection vehicles.

The target Chinese customer is 30 to 35 years old with an income of at least 40,000 yuan a year (about $6,000). Anyone earning less would have trouble handling annual premiums of 3,000 yuan for, say, a typical 50,000 yuan participating endowment plan with a payment term of about 15 years.

That middle class threshold doesn't sound like much in Canada, but Alan Lee, vice-president and general manager of the Beijing branch, says it goes a long way in thrifty Chinese families. Many of the targeted young professionals are unmarried, and still living with their parents.

Manulife's competition is tough, and entrenched. The Big Three domestic players -- China Life Insurance Co., Ping An (Group) Co. and China Pacific Life Insurance -- control about 90 per cent of the market. About 20 foreign companies have come in, including U.S. giant American International Group Inc. (AIG), Britain's Prudential Corp. PLC and Canada's Sun Life Financial Inc.

In China, life insurance is sold through captive sales forces, whereas Canadians are more likely to buy coverage from brokers who dispense a variety of companies' products. That, plus the vast market potential, puts intense pressure on Manulife-Sinochem's 4,000 Chinese salespeople -- people like Angela Huang, one of the 200 new recruits to the six-month-old Beijing office.

"It is hard because life insurance is just starting in China," says Ms. Huang, 36, who left a job with an international trading company to take a shot at more income and prestige from what she expects will evolve into a management career in life insurance.

"That's why we hope we can make money at it. If you can start early and work hard, you can maybe reach the top of your career," says Ms. Huang, who adds, almost apologetically, that she is relatively old for such a career switch.

After just six months in business, she and her elite colleagues are doing well by Chinese standards, pulling down commission incomes of 5,000 to 10,000 yuan a month. Their goal is to far exceed the minimum for a good performer -- about 30,000 yuan a month.

That level of income would allow 28-year-old Mike Qi to achieve his short-term goal -- to buy a luxury car in time for the 2008 Olympics. But Mr. Qi's ambitions go further: He wants to become a Manulife executive and perhaps move to Canada.

In the more affluent coastal cities where the foreign players have been allowed to operate, there's intense competition for good agents. (The huge sales forces of the domestic giants -- China Life, for example, has 650,000 agents -- are relatively unproductive, according to McKinsey, and often provide lousy service and poor information.)

Manulife-Sinochem prefers to train its raw recruits, rather than raid other companies. And it believes its competitive strength lies in the team-building and training that go on in the bright, busy sales offices adorned with motivational props and charts showing the leading agents' sales rankings.

In one Shanghai office, agents post notes on a mural of blue sky and clouds, describing their career goals. "I want to be a superstar," one writes. Sales meetings are packed with stories, pep talks, pulsating music, and outbreaks of rhythmic hand clapping to the familiar "let's go" chant.

Prominently displayed are large photos of former prime minister Jean Chrétien, accompanied by Manulife chief executive officer Dominic D'Alessandro, cutting the ribbon on a new Shanghai branch. "I think Canada would be more friendly to Chinese -- that's why I came to a Canadian company," Ms. Huang says. "I think the governments have a good relationship."

Rod Su, a 26-year-old Beijing university student and Manulife trainee, is more blunt: "I dislike Japan and the USA. Canada, I think, is a good country."

Hiring new people and opening new offices is expensive, putting a strain on capital. Mr. Lee says Manulife-Sinochem is making money, but could slip into a loss next year as it opens a flurry of new branches.

In the future, executives expect to penetrate more cities, and win approval to sell group insurance, an area now limited to domestic firms. They also want to expand the sales channels to banking partners.

But the company's future in China is riding mainly on the enthusiasm and ambition of the agents who gather every morning to sing:

"China-Manulife walks in step with China,

Nothing is too small for its attention and concern.

China-Manulife is with you

On the long, long road of life."

The extended play

Manulife-Sinochem sales agents greet the morning in one of the company's training rooms by singing the company song, a rousing anthem promising that Manulife will be with customers and employees throughout life. Company songs are common in the Chinese workplace, but Manulife workers sing more often than most. Many companies reserve them for special occasions, such as company anniversaries. Here are the full lyrics:

The China-Manulife Song

Let this happy; joyous song

Always accompany you through a lifetime.

When tomorrow's livelihood is safeguarded,

Life will be even more plentiful

In success or in setbacks,

China-Manulife will always be with you;

With courage to bear the burden of providing care and concern.

China-Manulife walks in step with China,

Nothing is too small for its attention and concern.

China-Manulife is with you

On the long, long road of life.

Do the best to build tomorrow,

Make tomorrow even more spectacular,

With a boundless, warm-hearted concern

Worthy of lifelong trust.

In the quest for confidence and dependability

China-Manulife always stands tall and unshakeable.

People all stay close around you

Because you always do what you promise.

China-Manulife walks in step with China,

Nothing is too small for its attention and concern.

China-Manulife is with you

On the long, long road of life.

For you, for you,

For me, for me,

For you, for you,

A boundless confidence.

Recommend this article? 0 votes

Back to top