Lessons from a country emerging from economic crisis

The result of a financial crisis left Greece roughly $330 billion in debt. But financial advisors there believe that as their country begins to emerge from its disastrous decade, there will be more opportunities than ever before, especially in areas such as pension planning and long-term health care insurance.

“The financial crisis rocked the stability of the insurance market on all levels,” said Kyriakos Chatzistefanou, an 11-year MDRT member from Thessaloniki. 

“The collapse of social security in the two basic pillars of pension and health is leading most Greeks to search for solutions in our market,” said 5-year MDRT member Karolos Vasiliou Markouizos, RPS, REBC, from Athens. “Low birth rates will greatly affect the whole society, especially in conjunction with the increase in life expectancy.”

Chatzistefanou says a focus on clients’ needs is even more important because prospects often think they know what is best, even without professional insight into the industry.

“Clients have been betrayed by the social health and pension system and see now that the light at the end of the tunnel is not the exit, but the train coming toward them,” he said. “Greek society has an opinion about everything — even in sectors they know nothing about. Clients do not know what their true needs are.”

This emphasis on meeting clients’ needs has been assisted by much-needed regulatory oversight.

The impact of regulations

“During the first decade of the millennium, the industry in Greece wasn’t really accountable, but unruly and even opportunistic,” said Sofia Zervoudaki, BS, a 10-year MDRT member from Athens. “The framework of regulation we work under has become a lot stricter than it used to be, something that forces us to be highly alert and careful in the advice we give and the services we provide.”

The most recent regulatory change was the October 1, 2018 implementation of the European Insurance Distribution Directive (IDD), which supports competition between insurance distributors and increases transparency. The General Data Protection Regulation (GDPR) also impacts how advisors handle clients’ personal data, a shift that has been difficult for some, including Zervoudaki.

“We were always sensitive and discreet about our clients’ data, but it was by choice,” she said. “Nowadays it is obligatory to use the highest possible privacy settings.”

For Zervoudaki, the most difficult part of GDPR compliance has been remembering that she can’t call prospects without their consent. Instead, she has to ask the person who referred them to act as a middleman and obtain consent upfront, adding an extra step to the process.

As Greece surfaces from its dark decade of financial instability, additional changes are sure to be on the horizon. But Chatzistefanou believes one constant will keep financial advisors from becoming irrelevant in the midst of uncertainty: exemplary client service.

“I don’t think that any change can affect professionals who operate conscientiously for the benefit and needs of the clients.”  

For the full version of this article, read “Greece: From collapse to compliance” in the January/February Round the Table. Read more in the January/February issue.

Learn more in the video “The economy and common sense brilliance.”