Sales management and agent training and

motivation
 Topics

„ Individual agent channel

„ Sales management strategy
„ Agent training and motivation

-1-
Stable individual agent force: a competitive advantage

Number of life insurance

agents in China since 2003
China Life’s individual
143.2 139.6 135.5 137.6
160
140 46% 48% 47% 47% 60% agents accounts for
120 65.5 66.8 64 65.2 40%
100
80
60
40
20
20% nearly half of the total
0 0%
FY03 FY04 FY05 FY06
143.2 139.6 135.5 137.6
life insurance agents in
Total Agents
CL Agents 65.5 66.8 64 65.2
China.
% of CL Agents 46% 48% 47% 47%

Total Agents CL Agents % of CL Agents Stable sales force

*
drives continuous
growth.

* Note: The number of insurance agents of 2003 included both life insurance and non-life insurance agents.
Source of data: CIRC

-2-
Quality of our agents improves continuously

Number of insurance agents, and

percentage of licensed agents

Current individual
80
65.5 66.8
72% 64 79% 65.2
94%
60.9
100%
agents at about
64% 80%
60 48.1 50.7

40
41.6 60% 650,000
40%
20
20%
Improving quality -
0 0%
2003
Sales Number
2004
Qualified Holders
2005 2006
Rate of Qualified Holders
94% of agents are
licensed

-3-
Solid training support to guarantee fast agent team growth

Trainers, agent supervisors and distribution network

• Growing
distribution
15000 network and
12000 strong sales
team
9300
9200 management
8000 8400 8400

6000 • Strong support

for sales team
1100 1300 development via
1200 950
structured
trainings and
2003 2004 2005 2006 sufficient pool of
instructors and
trainers agent supervisors distribution network
supervisors

* Source of data: China Life annual reports

-4-
Designated sales channels at all levels
Headquarters

Responsibilities of individual
Individual insurance dept. at different levels
Other Dept. in
insurance
Headquarters
Dept.

Provincial ƒ Policy-making and sales planning

Branch
ƒ Plan and implement the promotional plans

ƒ Develop and promote sales support tools

Other Dept. in Individual
Provincial branch insurance ƒ Build a training system and implement
Dept.
training programs
City-level
branch ƒ Strengthen sales risk management

ƒ Explore new sales channels and mechanism

Other Dept. in city- Individual
level branch insurance
Dept.

County-level branches/ field

offices
Sales
Team
-5-
 Topics

„ Individual agent channel

„ Sales management strategy
„ Agent training and motivation

-6-
Market targeting

ƒ Reform the current

team, establish a
collection and
Mass market：current
repeat sale team,
sales team
expand the high-
“Orphan” policy market： end team
collection and repeat sale ƒ The three sales
team groups fully cover
major markets,
High net-worth market: ensuring balanced
High-end sales team and focused
business
development

-7-
Combining strategies to drive growth
Strategy
combination Key initiatives Examples
‡ Launch “Affinity with China Life” promotional plan
Marketing Plan
Strategy promotional ‡ Plan “insurance in neighborhoods” related activities
events
‡ Plan for China Life “Client Date”
Demand-
driven
‡ Olympic-related incentive plans
Organize team
bonding ‡ Company-wide video agent morning briefing
activities ‡ Annual summit for sales over- performers
Channel
strategy

Sales Enhance long- ‡ Stock appreciation rights for star agents

access term
motivation ‡ Reward program combined with agent pension
plans products

‡ Medical insurance to sales team

-8-
Standardize operations and improve efficiency
3. Distribution network
1. Individual agent
Agents:
Appointments, interviews, prospect
information, proposal
Supervisors:
Customized support, joint visit，
telephone review, follow up
2. Agent group
“Jin Ding Project”
Build a management
structure and improve
productivity
Cross training
Learning through sharing
Sales office: knowledge among the
Provide logistical and sales teams, implement
administrative supports standard operational
and trainings, model
motivation, etc.
Streamline workflow
Standardize and quantify
company objectives,
process management to
enhance efficiency of the
whole network
-9-
Innovative sales support
Web Audio-visual System for Sales Outlets Sales Support System

Leverage advanced IT
capabilities, professional
experience, agent channel
development
Agent Activity Management System Agent Recruiting and Selection System

- 10 -
Demands-driven product packages
2006
2003

End
Upscale
ƒ Demand-
driven mass
marketing

ƒ Promoting
sound
s

District
Urban

insurance
2004 concepts

ƒ Focusing on
regular-
premium
development
Areas
Rural

- 11 -
 Topics

„ Individual agent channel

„ Sales management strategy
„ Agent training and motivation

- 12 -
Solid education and training

Career path New Recruit Agent Team manager

• Professional and ethical •Career training
•Career orientation, standards
•Management skills
exam prep course, on-
Levels duty training, assisted
•Need-based marketing
• Agent recruitment
prospecting, •Prospects identification skills
continuous training,
etc. •Telemarketing and client •Meeting skills
service
•Full event management

Qualification •Agent Qualification

•Financial advisor exam
exam Exam •Designation exam • CIAM

Educational Junior College, University, MBA (affiliated with Peking University and
Insurance Career College), China Life E-learning College
requirement

- 13 -
Comprehensive training system

Structured Non-
program structured program Overseas program

Comprehensive
program of 63 courses “Jin Ding Project”, Industry credential
(1,673 hrs) covering trainer’s skills including CIAM since
policy marketing, contest, workshop 2004， 600 team
business and seminar on new managers have
management, financial products, sales enrolled in the Level
management and experience sharing III courses
teaching methods

The company has established a comprehensive training and career

development courses to provide multi-level training for agents,
team managers, agent trainers, agent supervisors and other staff.

- 14 -
Ways to attract and retain agents
Main incentives

•Agent management System

•Elite Agent Club

Company
•Stock Appreciation Rights
•Pension and health
insurance coverage
Motivation system

•Performance ranking and

rewards •Long vs. short-term
•Other theme events incentives

•Industry recognitions
• “Dual Star” Conference and internal rewards
• Chinese Insurance
Conference
Industry

• Annual Dragon
Conference
• MDRT
• IQA、IAP

- 15 -
Long-term Incentive Schemes

Compensation Structure
Incentive Structure
Commission Incentive

Performance Compensation New recruits

appraisal • Individual: FYC,
renewal commission,
• Individual awards Retained agents
and/or team • New recruit training
FYC, renewal allowance
Junior manager
premium • Management
collection allowance, base
salary Middle
rate, team
management
structure • New recruit
allowance Senior
management

A competitive income and career development path will motivated

agent managers to build a strong agent team
A fair commission and incentive structure retains and develops a
stable sales force

- 16 -