Insurance agents want the government to speed up efforts to guarantee policyholders' interests in order to restore confidence in the sector. The Insurance Practitioners General Union, representing more than 2,800 members, said consumers were reluctant to insure after last month's run on American International Assurance and the global financial meltdown. Union chairman Roy Cheung Wai-leung said the number of new insurance policies written by some insurers had dropped about 10 per cent year on year last month. Mr Cheung urged the government to set up a compensation fund, similar to the guarantee scheme for bank depositors, to help policyholders in case an insurer became insolvent. He said such a fund could maintain confidence in the sector and safeguard agents' jobs. Chief Executive Donald Tsang Yam-kuen said in his policy address last week that the Office of Commissioner for Insurance had been in talks with insurers about establishing compensation funds, but Mr Cheung said the response was too slow because the idea had been raised five years ago. 'I know some practitioners have needed to borrow money from employers to make a living, because many consumers were reluctant to insure after some big-name insurers got into trouble,' Mr Cheung said. Insurance sector legislator Chan Kin-por agreed on the need for protection funds in principle, but said they could not 'solve all the problems'. He said details, such as the types of policies covered, the extent of protection and who should contribute to the funds, needed discussion. Peter Tam Chung-ho of the Federation of Insurers said the funds might give additional protection to policyholders, but the sector and the public needed to reach a consensus on how much they were willing to pay. Mr Tam said supervision of insurers was more important than compensation mechanisms. Union representatives will discuss their concerns with OCI officials on Wednesday.