Chennai: Once a clerk, always a clerk, runs an old adage. Perhaps the description was intended to capture the attitude of clerical staff in government and public sector undertakings. However public sector insurance companies are now striving to disprove this pejorative.

The Kolkata-based National Insurance Company Limited is the latest public sector insurance company to join the ranks of those striving to make marketing executives out of clerks and other administrative staff.

The company has decided to open satellite offices to be manned by a single person from the administrative staff but with a flair for marketing. This selected official will be expected to single-handedly meet an annual premium target Rs35 lakh, issue policy documents and take care of renewals. Half of the premium procured should be by selling personal lines of business (health insurance, personal accident, hous, etc).

While there will not be any cadre change for those who are selected to man the satellite offices, they will be paid telephone, conveyance allowances and also rent for the premises subject to certain limits.

However, the target officials are not enthusiastic as they feel this scheme is not lucrative enough. First, there is no change in the salary and the cadre nor are there any commissions / incentives for achieving or exceeding the target.

Second, the volume of documents will be high in the personal insurance category and it will be difficult for a single person to do all the work, in addition to going out into the market. In the existing setup, a whole office assists a marketing executive with even smaller targets.

It was United India Insurance Company Limited that introduced the concept of single man office a year ago. The eligibility criteria for applying for the scheme is limited to officials in the rank of senior assistants / senior clerks and above. It is learnt that most of the people selected came from the officers' cadre assigned with the marketing function. The annual business target was fixed at Rs25 lakh.

Prior to these two companies, New India Assurance Company Limited decided to convert some clerks into full-fledged development officers / marketing executives. The response was good as there was a cadre change and there were incentives for achieving and exceeding targets. According to officials the converted clerks are performing well.

Following this, National Insurance also decided to introduce such a scheme, which was later shelved.

The simple logic behind all these schemes is the redeployment of staff albeit to beef up the topline and bottomline through the cheapest route. It should be noted that all the government-owned general insurers are exceeding the management cost limit (19.5 per cent of the premium income) specified by the Insurance Act. And companies try and convert the fixed cost staff into revenue earners through these schemes.

However, the most sensible and attractive scheme for clerks is the one announced by the Life Insurance Corporation of India (LIC) which enables LIC clerks to become agents. To give these officials some time to settle down in their new role as marketing agents, LIC has decided to pay them a salary. They will be paid their full salary during the first year and will also be eligible for commissions on the policies sold. In the second and third years, the salary will be reduced to 50 per cent and 25 per cent respectively, while continuing to enjoy the commissions on the policies.

At the end of the third year, they will have the option either to quit LIC and become full time agents or revert to their original cadre.

Interestingly, LIC is not paying anything extra to the officials who take up the marketing. As commissions are factored in pricing a policy, LIC has decided to part with the agency commission.