'Israelis were left without insurance during the coronavirus crisis'

According to Isaac, during the pandemic, a problem arose because Israeli companies stopped operating, yet insurance agents wanted to sell policies issued by international companies to cover travel.

 SARS-CoV-2, the novel coronavirus behind COVID-19 (Illustrative). (photo credit: fusion medical animation/unsplash)
SARS-CoV-2, the novel coronavirus behind COVID-19 (Illustrative).
(photo credit: fusion medical animation/unsplash)

Shlomo Issac, the president of the Chamber of Insurance Agents, claims that Israelis had no insurance coverage during the coronavirus crisis.

Issac said that international insurers didn't enter the Israeli market because of government rules and regulations. Insurance agents only promote the best interests of clients, and complaints are handled by the chamber's ethics committee.

Issac stated in his first interview with Maariv that Israel is the sole country where a foreign insurer doesn't operate due to difficult corporate regulations. Foreign insurance agencies don't want to do business here; Issac raised this issue with the Competition Authority as well.

According to him, during the pandemic, a problem arose because Israeli companies stopped operating, yet insurance agents wanted to sell policies issued by international companies to cover foreign travel. 

Since this is prohibited by law, clients were referred to foreign websites to buy insurance directly. This shouldn't happen in a normal country.

 Illustrative image of insurance.  (credit: PXHERE) Illustrative image of insurance. (credit: PXHERE)

When asked if insurance agents aren't abusing their power and making a sale using the "twisting" method against the customer's interest, Issac said that he heard about this phenomenon which happens because the various savings bodies encourage it. 

They offer rewards for a high volume of sales, he explained. The market is very competitive, especially in the pensions field. Yet clients are taken care of. Insurance agents see only the best interest of the client; the bureau handles complaints. This situation is good and really helps clients. Unfortunately, insurance agents twist facts; this needs to be addressed.

On the question of whether there's room to expand the status of the insurance agent, Isaac replied that agents must serve as the central body which handles the employee's retirement conditions. 

All the tax advisors and accountants who handle retirement with the tax authority come to get an opinion from agents on the financial side of the customer. Issac said that agents must represent clients at the level of the individual person facing the retirement dilemma. 

Everyone should focus on what they understand

But in the field of the capital market, everyone should focus on what they can understand. In everything related to the regulations of the pension funds, agents have a wealth of information to advise and need to get into the field of taxes too.

Regarding the competition in the industry, Issac said that the bureau commissioned a study on what's happening internationally regarding travel insurance abroad. It turns out that travel agents only handle cases of trip cancellation or lost luggage. All other issues are handled exclusively by the insurance agents. 

There's no practical reason for travel agents, who aren't experienced, to sell insurance. 

As is customary in the pension sector, only licensed holders are allowed to sell. Issac stated that this is also true for the insurance companies that sell through sellers, and it costs them more money. An agent is rewarded only for success with wages and bonuses.