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What is Million Dollar Round Table (MDRT)? PDF Print E-mail
Written by Wilfred Ling   
Sunday, 22 August 2010

Very often insurance agents and financial advisers would state in their name cards that they are members of the MDRT. You can also see it in the newspaper when photographs of MDRT members are splashed in full page. So what is MDRT? Are they millionaires?

Quoting from the website HERE:

The Million Dollar Round Table (MDRT), The Premier Association of Financial Professionals, is an international, independent association of more than 31,500 members, or less than 1 percent, of the world's life insurance and financial services professionals from 464 companies in more than 80 nations and territories. MDRT members demonstrate exceptional professional knowledge, strict ethical conduct and outstanding client service. MDRT membership is recognized internationally as the standard of sales excellence in the life insurance and financial services business.

As it can be seen from the above, that members of MDRT demonstrate exceptional (1) professional knowledge (2) strict ethical conduct (3) outstanding client service.

So how does a financial adviser qualify to be member of the MDRT? A check at this page HERE shows that there are altogether 15 pages of requirements. However, the entire 15 pages are details on how to calculate the production (sales) requirements either in first year commissions or first year premiums. For example for year 2011, the qualifying commissions that a Singapore adviser must earn in order to be a member of the MDRT should be at least S$103,000 to qualify for the MDRT. This is based on first-year commissions. Note that many life insurance products pay commissions over a few years. The qualifying commissions are even higher for Court of the Table (COT) and Top of the Table (TOT).

So what about the part on “strict ethical conduct” and “outstanding client service”? It appears to me that these are “outsource” to other parties. For example, Singapore MDRT members must also be a member of Association of Financial Advisers (AFA), Financial Planning Association of Singapore (FPAS) or Insurance & Financial Practitioners Singapore (IFPAS). I guess the assumption is that these associations would verify the ethical conduct and client servicing quality. Currently, AFA only accepts corporate memberships. Thus, the individual (human) advisers only have two other choices. However, as far as I know neither FPAS nor IFPAS conduct regular mandatory audit on its members’ real life client cases to verify its members ethical conduct and competence (which is part and parcel of excellent client services).

Although the MDRT has been well recognized by many financial practitioners as a measurement of their success, I feel that the organization must transform itself for the future. For instance, the focus on first year commission in its calculation of production eligibility encourages aspiring candidates to focus on short-term sales rather than long-term relationships. It also places too much emphasis on sales with little emphasis on ethical conduct and competence. Relying on outside associations which do not conduct mandatory audit on its members defeats the purpose of MDRT members demonstrating exceptional strict ethical conduct and outstanding client services.

These days, being a member of the MDRT is synonymous as having achieved a certain level of income. Those who claimed to be a member of the MDRT are indirectly saying to their customers and peers the kind of income they are earning. Frankly speaking, I find this quite tasteless. Professionals like medical practitioners, lawyers, accountants and engineers do not tell others about their income although it is a common knowledge that many of these professionals are extremely wealthy. Moreover, humility is a virtue which should be embraced. Why financial advisers focus so much in becoming member of the MDRT, COT or TOT? It is because the job of a financial adviser is ultimately a sales job. A successful salesman is strictly measured by the amount of sales he brings in to his company and ultimately the income he earns. Nevermind whether he is competent or not.

Someone joked with me that financial advisers are in the business of helping to plan for financial independence - not the client’s financial independence but the adviser’s own financial independence. How about your financial adviser?

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The Watchman  - Marks of Conmen and women   | |2010-08-22 22:37:02
These MDRT, COT or TOT agents are at best sales champions and at worse conmen and conwomen. They only meet the commission quota and the rest of requirements are for show.....ethics and professionalism they break always.If they are ethical and professional they would do fact find and analysis and recommend products based on the uncovered needs fully.Unfortunately these people don't. They go for the fastest way and that is to selll high commission products and to peddle them upfront.Why? tell me which products are the best route to these dubious awards? Of course , 3 of them and they are Whole Life , endowment and the regular ILPs. They all pay high commission.Are they good products in themselves? No..let alone as financial planning solutions.
As products they are rotten, so how can they be good solutions.But these products are favorite with salesmen and conmen alike to achieve the mdrt , cot and tot awards in the fastest way.
This is a conmen's club and lucky there are only 1% in the world.
I have known many former agents and some are still around who achieved one of these awards and they told me that to achieve mdrt you don't need to be an expert in these products just good in 'salesmanship'or conmanship. No difference between them, they acheive the same result..result justifies the means.Many of them came in into this trade for get rich quick reason.
I have advised consumers to avoid these agents with such marks. I explained that these are not marks of successfully helping people to meet their life goals but how much commission they robbed from their clients and these marks are the measures of much they robbed.These agents are dangerous and likely they will rob you of the financial well being.
Honest Abe  - Really?   | |2013-06-08 06:45:54
Dear Watchman....
It sounds like you had a bad experience. And for that I am truly sorry. I have worked in the financial services industry for over 10 years now and throughout this time, I've always been ethical and honest, which my clients appreciate. So you can expect this response to be reflective of my career.....ethical and honest:
I don't know what you do for a living and, quite frankly, I don't care. You decided to post something on a random website you came across because of a bad experience you or someone you know had with a member of the MDRT. I know this because kids don't know if they like turnip greens until they try them. Fair enough logic? You speak of products such as whole life as though they are, in and of themselves, unethical. This is completely untrue. I will agree that sometimes whole life is not positioned properly. But so are brand new cars parked in the driveways of mobile homes. At least permanent life insurance isn't a depreciating asset that comes with liabilities.
In short, my point is this, sir: I work VERY hard at my career to preserve my reputation. The last thing I personally need is to read something like this, written by someone who has absolutely no working knowledge of the financial services industry, outside of his small exprerience. Don't ruin it for the good guys man. Thanks.
Anonymous   | |2013-06-09 22:45:02
I was MDRT for 5 years from 2006 to 2010. I hung out with MDRTers from 2004 to about 2012. During those 9 years, I have NEVER felt the focus to be on the client's well-being or his family's well-being. Instead the focus is on advanced selling techniques and psychology, establishing confidante relationship and "pop-culture" investment double-speak.

During 2005 to 2007 when I was "ramping" up sales and connections, I also had to act as office assistant / errand boy e.g. fetching good "targets" to & from airport for their business trips in the middle of the night, accompanying them on property visits to act as recorders and 3rd-party perspective.

Many ambitious agents (especially those in banks) are also doing the same especially during the first few years, driving over to the clients homes during weekends, running some of their errands etc. And of course resorting to gimmicks, gifts, rebates etc etc.

No matter how well-educated and established, many of these rich fellows like to be "carried" and executed in deeds, not just words. Hell even karang guni man will like to be "porr-ed", but nobody will do it coz where's the money in it.
Anonymous   | |2010-08-23 00:51:20
Today, Singapore is one of the very rare developed countries to still portray MDRT, COT & TOT like Medal of Honour heroes, taking out full page advertisements in newspapers with photographs, like as if to tell the public better seek these agents out if want sincere & trustworthy service.

The truth of the matter is that such dubious awards solely count on earning $$$$ of commissions to qualify --- so the agents are just interested to sell you policies with the highest commission to themselves. Who cares if the policy is beneficial to you, or is adequate for your needs, or is affordable.

In other developed countries like US, Australia and UK, printing MDRT, COT & TOT on namecards is tantamount to sales suicide, as you are announcing to all the customers that you are only interested in selling expensive policies with high commission. Overseas agents & advisors who get such awards keep quiet about them, and only boast about it to fellow conmen & conwomen at insurance "seminars" or at the annual MDRT convention. Today in US, showing customers you have MDRT is like carrying a gun to a client meeting -- you're telling him that you can't wait to rob him. The only people in the US who don't know the true nature of MDRT are the wildmen living in the Rocky Mountains or the gangbangers in the ghettoes who didn't even finish primary school --- and these people will tear you & your family a new one if you try to con them.
Wilfred   |SAdministrator |2010-08-23 00:58:38
Is it true that MDRT is no longer that widely embraced by insurance agents in United States? Do you have any online literature which you can share with everyone?
amylauschke  - Good Info - But Too Late   |Registered |2010-08-23 04:54:48
I like to share my own experience. I was widowed more than 10 years ago. I was still working and had 1 teenager son as a dependent. Instead of making sure that upon my death, my teenager son would get sufficient to live on and to finish his education, I was sold 2 endowment policies.

Can you see how cheated I felt some years later, when I learnt about the different types of policies from other well meaning financial advisers?

And yes, she is a member of the COT now and gets to go on incentive trips every few months.
The Watchman  - Conmen Or Thief (COT)   | |2010-08-23 05:53:12
This post is taken from another blog and is posted here to educate readers who these 'successful' insurance agents
really are. I think they are successful conmen and women.

"MDRT is an obsolete benchmark created many years ago to encourage salesmen to sell more insurance.Helping people to have insurance in itself is a noble idea but unfortunately MDRT has a the wrong criteria for qualification. It is money based or commission based and as a result over the years many insurance agents abuse, resort to unethical practice and fleece their clients to qualify for this award.It is well known in the industry that mdrt , cot tot agents , in their pursuit for these qualifications ignored the needs of the clients and consciously and willfully committed mis-selling and all malpractices to qualify.Product selling an expensive product with high commission is mis-selling. It is cheating.
These marks are bad marks although in their constitution ethics is important. Unfortunately those qualified ignore ethics by selling expensive whole life and endowment products which are very poor as financial planning solutions. Worse, need of clients is ignored. Need is deliberately ignored because if the approach to cleints' concerns is need based these products are unlikely and never will be recommended on reasonable basis.
However, these mdrt people don't. They product push and throw away ethics and conscience to the wind in order to rip off the customers and make huge commission from it.
If MDRT or other marks can redefine
the objectives and the criteria for qualification like, eg. how many people that were helped to achieve their goals or some other criteria which are truly noble, perhaps the qualifiers of these marks can be proud of. But alas, the current qualifications is about how many people you have cheated and ruined in order to earn so much money to qualify. Those in the industry know these people push products , committed unethical practices , do anything , say anything , stoop to anything to fleece the consumers without considering the needs of their cleints.
JC, you should do your best in the interest of your client. UTs are investment vehicles and not products to be sold to make money, to help your cleint to accumulate wealth, to achieve a funding need.
Bear this in mind and don't be distracted by the mdrt mark which has gained notoriety in the past years.Think of how you can help your cleint. This will be a more meaningful approach than product peddling
Garrett   | |2010-08-23 16:45:41
I would *NEVER* deal with an IFA if he/she told me about his MDRT credentials. MDRT implies that the IFA is a salesperson (earn a lot of money from product commissions), and given that the best commission paying products are usually the worst product in the insurance industry, a logical assumption is that a MDRT person is a unethical salesperson. I may be generalizing here, but I won't be surprise if most MDRT people are product pushers. In fact, MDRT people should need to justify to their clients on how they got their earnings.
Jack   | |2010-08-24 13:31:29
I have to agree as well,

MDRT,COT,TOT doesn't anything about ethics or integrity, it only tells how successful an agent is selling products that earn the most commission. Yet some consumers like to work such members as they think being successful = being good at what they are good.

It makes more sense to have an award for agents that sell the most amount of coverage. Agents to win such awards are probably the ones who sell the most term policies.
Anonymous   | |2011-02-24 18:25:25
The MDRT Experience is in Singapore: peakers.asp

Instead of just blindly bashing agents, why not have an open mind and let the practitioners who have been MDRTers for many years share with you what this job is really all about?
Anonymous   | |2013-06-14 14:38:25
ask any dumb insurance agents and they will tell you how to qualify for mdrt...just push high commission products lah, no need to say one...If you really do financial planning and base your recommendation on your your finding, 100% the product that best meets the clients' need is term insurance.
So those who claim whatever ethics that they can meet their clients' needs with wholelife products are liars and conmen..Tell me who can afford $500K critical or $1000,000 whole life? only the very rich but who don't need insurance ,right? What open mind? you need OBJECTIVE MIND, LAH.
Anonymous   | |2013-06-14 23:15:07
Dear consumers,
if you are looking or buying life insurance please check with Fund Supermart, Dollarex or ANY banks, ALL of them are giving away huger discount or rebate of at least 50% pf the commission.
Don't be fooled by insurance agents.
The "successful" top agents are also giving rebates for whole life or endowment and high commission products so that they can qualify for MDRT.
Thank MAS, soon consumers can buy direct from insurers without paying the commission to agents and they can compare the premiums from of various products at the website called the web aggregator of MAS or LIA. Can insurance agents compare all the products? No, they only push theirs and con you to believe that theirs is the best. Isn't they are lying? Yes, they are all liars and conmen and women.
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