No-commission insurance policies now available

No-commission insurance policies now available

By Angela Teng and Chloe Wang
POSTED: 07 Apr 2015 14:15
UPDATED: 07 Apr 2015 21:58

TODAY reports: An online portal was also launched so consumers can compare insurance products on the markets more easily.

SINGAPORE: Consumers can buy basic life insurance policies directly from insurance companies at customer service centres or websites, without going through financial advisers and incurring commissions, from Tuesday (Apr 7).

The Direct Purchase Insurance (DPI) initiative, which was implemented by the Monetary Authority of Singapore (MAS), comprises term life insurance products with total and permanent disability (TPD) cover; whole life insurance products with TPD cover; and optional critical illness rider attached to term life or whole life insurance products.

The initiative is designed to meet the basic protection needs of individuals, and comes without financial advice.

COMPAREFIRST ONLINE PORTAL LAUNCHED

An online portal www.comparefirst.sg was also launched to allow consumers to compare insurance products on the market and pick the one that best suits them.

The portal was set up by the Life Insurance Association Singapore (LIA), MAS, Consumers Association of Singapore and MoneySENSE. It features five categories of insurance products: Term life insurance, whole life insurance, endowment policies, DPIs, and investment-linked life insurance policies. A dozen insurance companies are listed on the web aggregator, such as AIA Singapore, AXA Life Insurance, Aviva, Great Eastern Life Assurance, NTUC Income and Prudential.

LIA said that its priority is to "help individuals make better informed choices when making their purchase of life insurance products".

For instance, a 30-year-old man looking for term life insurance till he is 65 will need to fill in a few fields, and the web portal will show the key features and premiums for similar products offered by various insurers on a single screen.

LIA said the move could help to improve the take-up rate of life insurance among Singaporeans.

"Hopefully, the awareness of life insurance and understanding of insurance products will increase. With that, I think that will help to reduce the level of insurance gap among the consumers, so as a result, we hope that with this initiative, more people will come forth and access life insurance products," said Mr Khoo Kah Siang, president of the Life Insurance Association Singapore.

WEB PORTAL AIMS TO ENHANCE TRANSPARENCY, BOOST COMPETITIVENESS

The web portal is also expected to enhance transparency and boost competitiveness among life insurers, encouraging companies to further develop their own products. It could also help less well-known players in the industry to reach out to more consumers.

Said Ms Kwek Perroy Li Choo, chief marketing officer at AXA Life Singapore: "Online tools like compareFIRST would allow the lesser-known brands to be featured alongside the larger or more commonly-known brands, and customers would, for the first time, be able to see at one glance the entire list of companies that will offer a particular product that they like."

LIA added: “We believe that these two initiatives will provide individuals more choices and help them make better informed decisions when purchasing insurance.”

compareFIRST and DPI are part of the recommendations made by the Financial Advisory Industry Review (FAIR) panel in 2013.

-TODAY/CNA/kk/dl


- wong chee tat :)