How BBVA Microfinance Foundation increased voluntary microinsurance sales by 20% in one year
This is the third blog in our series on salesforce management within insurance providers, in partnership with FSD Africa
BBVA Microfinance Foundation manages its six microfinance institutions (MFIs) in five countries in Latin America. All these MFIs offer microinsurance products ranging from life and accident, funeral, property, agricultural, savings, business interruption and card insurance products.
Its MFIs’ success with voluntary insurance is noteworthy. Although it offers embedded products, the majority of its clients have some kind of voluntary product. And during 2019, it grew its voluntary microinsurance policies sales by 18%.
We spoke with Paloma Pérez Castañares, Microinsurance Manager, to find out how.
Tell us about the clients you reach with microinsurance.
Our target market are microentrepreneurs and all of our efforts are focused on helping them grow their businesses. We partner with insurance companies, brokers and intermediaries, always looking for the best option in terms of product, price and support for those microentrepreneurs.
BBVA Microfinance Foundation achieved impressive growth in voluntary insurance in 2019. How did you bring this about?
We’ve doubled down on refining our sales force management, including strong and regular training, improving internal processes, aligning incentives schemes and a broadening of our sales forces, so that branch officers as well as credit officers now sell insurance.
Can you give us some examples of the new measures you put in place?
Firstly, reporting has been key. We have included insurance revenues in the profit and loss calculations for every branch, so that branch managers can see how insurance helps them reach their objectives, including when it covers a loan that might otherwise not be paid back. We also share the number of claims paid with all the managers and all members of the salesforce, so that everyone can see that the insurance is fulfilling its promise.
Then, we needed to create the right incentives. We create mixed objectives for our salesforce, which combine metrics like the number of bank accounts opened, insurance policies sold, the number of savings accounts activated, and so on. It’s key that microinsurance is included as part of that package of metrics, and it’s important that the incentive scheme is balanced. You can’t put too much weight on selling insurance, as that may interfere with other aspects of the business, but it also can’t be too little. The salesforce needs sufficient incentive to learn to explain a new product like insurance, which is more complex than others like loans, and to close the sale and related processes.
We create incentives in each country, but, in general terms, we start by putting in place incentives for insurance sales for special campaigns. Then we include insurance in the overall incentive schemes along with additional regular campaigns. Every time we change the incentive scheme, we immediately see the effects in our results.
For example, with Financiera Confianza in Peru, we saw an important change when we started to include insurance objectives for the office managers and the regional managers. This made sure that everyone was truly aligned on insurance sales. We also found that the salesforce was receiving the wrong message when only certain insurance products were considered in the incentives. We therefore made sure that all voluntary products were included in the incentives. Another key approach was to copy all the agencies in the emails with the monthly numbers, as this created natural competition between them and encouraged higher sales.
Finally, we needed to help our salesforce feel informed and confident in making insurance sales — both through training and through tools they can use in their day-to-day work.
How have you used training to improve the salesforce’s confidence in insurance sales?
Great efforts have been undertaken in the training of credit officers regarding microinsurance. The first part of any training is overcoming the barriers that the credit officers have against insurance. When you convince your sales force about why it is important to have insurance and they understand the value of the products they offer, half of the work is done! So, we spend time on this, and it’s a recurring activity. We provide face-to-face training, particularly when we launch a microinsurance product, and then we provide recurrent training through our Digital Training Centre called “Campus”. This is an online platform where staff can find specific courses on microinsurance products and even perform tests that allow us to be sure of the products and processes understanding and identify any additional training necessities and any improvements needed.
We also offer additional tools to support the salesforce. In Financiera Confianza in Perú, whenever officers open the internal insurance app of their institution, they see reminders about the insurance waiting period, the premium, deductibles, and so on, as well as tips on sales and the benefits of insurance. Some of our partners have taken further steps. For example, Bancamia in Colombia and Financiera Confianza in Peru have increased their availability for answering questions that the salesforce might have on insurance products through call centres and direct telephone numbers. The call centre staff are trained to empathize with the salesforce. All of this generates confidence among the salesforce, which we have found to be key to successful voluntary insurance sales.
How do you go about selecting the microinsurance products that you offer?
We always look for and negotiate products that suit our clients’ needs and that are broadly inclusive. For our smaller MFIs, it’s key to start with very simple microinsurance products that can be offered to any client, so that our credit officers know how to properly explain it and they know that the product suits everybody (the only constraints are typically around age and sometimes pre-existing health conditions). Once our salesforce has learnt to sell microinsurance, it’s time to increase the number of products and start to work with more complicated products. At this point, we develop specific products for selected segments of our clients.
You mentioned that the salesforce can receive information through an internal app. Do you use any other technology to support your sales agents?
Our strategy is that every credit officer should be able to act as a bank branch by him or herself, and we are working hard in order to have paperless processes. For this reason, our credit officers carry a tablet or mobile that helps them carry out sales in three ways:
- They have all the information available on each client that they manage, so at any moment they can know which microinsurance products each client has, provide the client with information, or know which product would be suitable in terms of upsell
- New information can be entered and will be synchronized with the core banking system
- In some cases, they can sell microinsurance products directly in the field using the mobile device
Credit officers also carry a small portable printer, so that when they sell a product or receive an instalment for an existing product, they can print the receipt and a reduced policy document directly for the client.
