Attrition in insurance sales roles remains stubbornly high despite aggressive incentive structures, pointing to deeper flaws in how roles are designed and talent is managed.
In an interview with People Matters, Santanu Banerjee, Chief Human Resources Officer at Bajaj Life Insurance, said the industry has long overestimated the role of compensation in driving retention, while underestimating structural and lifecycle issues.
Attrition is being misdiagnosed
Banerjee believes that organisations are solving the wrong problem.
“Today’s workforce is not looking for jobs; they are looking for careers. And it is on us, as a sector and as organisations, to live up to their expectations.”
He said insurance firms have historically focused too heavily on pay and incentives, assuming exits are driven primarily by earnings.
“The actual situation is more nuanced.”
What really drives retention depends on career stage:
- Early stage: Enablement and training build confidence and continuity
- Mid stage: Earnings become the key motivator
- Advanced stage: Growth and progression matter most
“When we design our people practices without this lens, we inevitably address the wrong problem at the wrong stage,” he said.
The first-year drop-off is the biggest risk
The sharpest attrition, Banerjee said, happens early.
“The first year is where the sharpest exits happen. This is where the promise made during recruitment meets the reality of the role.”
This gap, he noted, exposes weaknesses in onboarding.
“We've focused on product knowledge and regulatory training but underinvested in helping new joiners build their first network of distributors and customers, find their footing with the manager, and understand what success realistically looks like in the early months.”
He described traditional onboarding as compliance-heavy rather than capability-focused.
Targets are not the issue. Design is
Sales roles will always have targets, but poorly designed ones can push employees out.
“The question is not whether targets exist, but whether they are perceived as fair, achievable, and contextually set.”
Uniform targets across regions and experience levels, he said, often create disengagement.
Banerjee also stressed that how managers handle performance matters as much as the targets themselves.
“A manager who can coach through a difficult quarter retains far more people than one who only reviews a scorecard.”
Managers are the real retention lever
In distribution-heavy models like insurance, Banerjee said the manager is the decisive factor.
“The frontline manager is the single most important retention variable.”
Sales employees often work in isolation, deal with rejection, and operate across geographies. In that environment, the manager becomes their primary support system.
“A manager who builds genuine trust within the team and invests in each person's development creates a retention buffer that no incentive programme alone can match.”
On the other hand, managers who focus only on activity tracking tend to drive exits.
Expectations have shifted beyond pay
Banerjee said younger sales professionals are increasingly evaluating roles through a broader lens.
“Today's sales employees want to know where this role takes them, whether the organisation will invest in their skills, and whether their well-being is genuinely considered.”
Key expectation shifts:
- Clear career progression
- Structured learning pathways
- Meaningful recognition, not just incentives
Organisations that fail to respond to these expectations risk continued attrition.
What actually improves retention
Banerjee pointed to operational interventions rather than one-time fixes.
What works in practice:
- Structured onboarding beyond the first few weeks
- Strong induction and certification systems
- Early mentorship from experienced team members
- Transparent and visible career pathways
Beyond the first year, engagement depends on consistent recognition and ongoing career conversations.
The structural reset ahead
Looking ahead, Banerjee said the industry must rethink its distribution model.
“The conversation is increasingly shifting from distribution reach to distribution quality.”
He outlined three priorities:
- Smarter hiring: using data and behavioural assessments
- Digital enablement: reducing friction in field roles
- Specialised career tracks: giving high performers a reason to stay
“The organisations that will win on retention are those that treat their distribution workforce as a strategic asset.”
The interview makes one point clear. Attrition in insurance sales is not a compensation problem. It is a design problem.
Fixing it will require organisations to rethink how they hire, onboard, manage and grow talent, rather than relying on incentives alone.