2015 is expected to be a year of dynamic change for the life insurance industry in Singapore
Industry watchers have said refreshed guidelines and new initiatives are likely to change the insurance landscape and strengthen the resilience of the industry - and the Life Insurance Association (LIA) said the industry is well prepared to embrace the regulatory changes.
Finding out more about insurance products will soon become easier for Singapore consumers. A web aggregator will be launched in early April, and the information portal will allow consumers to easily look up products and compare indicative quotes in a user-friendly manner.
This was announced by the Monetary Authority of Singapore (MAS) at the Life Insurance Association annual luncheon on Wednesday (Mar 4).
RBC 2 will not hamper well-managed insurance businesses: MAS
THE proposed changes to the risk-based capital framework, or RBC 2, which seeks to reflect the relevant risks that insurers face, will be more risk sensitive and robust but it should not hamper well-managed insurance businesses.
Ong Chong Tee, deputy managing director of financial supervision at the Monetary Authority of Singapore (MAS) said that the regulator will implement RBC 2 only after it has conducted "a thorough calibration and assessment".
At the Life Insurance Association Singapore's (LIA) 13th annual luncheon on Wednesday, he pointed out that some of the insurers "are naturally anxious" if the required capital buffers would be the same under RBC 2 as it is now.
Commission-free insurance policies available from April
Consumers may be able to start buying basic life policies directly from insurance companies from as early as next month, bypassing financial advisers and saving on commission, the Monetary Authority of Singapore (MAS) said yesterday.
The much-anticipated move is aimed at giving consumers another avenue to buy insurance products and encourage more people to be insured. However, industry professionals told TODAY they do not expect the take-up rate to be high due to the limited coverage of the plans and the typically complex nature of insurance policies that many might have difficulty understanding.
“My guess is 10 to 20 per cent of people, which is not a big number, will buy directly from the insurance companies. The MAS has also imposed a maximum sum assured per person per insurer of S$400,000. If you want more, you will have to buy from another company, which can be cumbersome. I don’t think many people have the time and financial expertise to do everything on their own,” said Mr Christopher Tan, chief executive of financial advisory firm Providend.
April target for direct purchase of basic insurance products
The much anticipated move to allow consumers to compare life insurance products and to avoid agents and buy basic policies directly is expected to begin next month, according to a top regulatory official.
Mr Ong Chong Tee, deputy managing director for financial supervision at the Monetary Authority of Singapore (MAS), told a Life Insurance Association (LIA) lunch on Wednesday that the target launch date will be "early April".
The direct purchase channel and the web aggregator were key initiatives suggested by the Financial Advisory Industry Review (Fair) panel, which was set up in 2012 to raise industry standards and improve the distribution of products.