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Singaporeans deserve the right to choose

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Rule that allows full suite of life insurance products to be sold online could be a game changer

The recent announcement by the Monetary Authority of Singapore (MAS) that it will soon allow insurers to offer the full suite of life insurance products to be sold online, without advice, is a defining moment for Singapore's insurance industry.

I believe that by giving Singaporeans a choice over how they buy their life insurance, we have the opportunity, over the next three to five years, to change the industry for the better.

This will raise standards overall, encouraging the entire industry, including insurance agents, to provide further value-add to meet consumer demands.


Not everyone shares my enthusiasm.

One argument is that, unlike investment products, insurance is too complicated to be sold online. This seems misplaced and worse, misunderstands the challenge we must meet.

Surely, if individuals can make informed decisions about asset prices, yields, currency fluctuations and so on, they're more than equipped to judge what cover they need to protect themselves and their loved ones.

That said, the comparison is apt. A few years ago, traditional stockbrokers argued that finance was too complex for private investors to manage themselves.

However, new online portfolio management tools created a simplified experience that investors adopted in droves, displacing many of the old-fashioned brokerage firms.

Another example is from the package holiday industry, which wanted to maintain the status quo.

Much of the complexity in the insurance market today has been created by the industry itself.

They argued that the supposed complexity of arranging flights, ground transportation, hotels and tours required human intervention.

It then discovered, as companies such as and Expedia quickly grew, that people preferred to do it themselves.


Much of the complexity in the insurance market today has been created by the industry itself.

While most insurers offer information about what each of their products offer, few allow consumers to go through an online experience that enables them to understand which policy is right for them, instead, guiding people towards meeting an agent.

In a world where we can manage almost everything using our mobile phone, this highlights the fear of change that many insurers have.

Instead of embracing change, they are trying to protect their current business model.

In fact, according to research we commissioned earlier this year, the main reason people used agents was to take care of the complicated paperwork.

This shouldn't be the case and it's the industry's duty to respond to MAS' initiative and make it simple.

It should be straightforward to select the cover you require and purchase with a simple click, without worrying about being caught out by an exclusion hidden in the terms and conditions.


Singapore is not the first market to allow life insurance products to be sold directly online. Australia, the United Kingdom, China, India and Malaysia are already doing so.

But the permission to sell online hasn't translated to major market share for this channel in those countries yet.

The two primary reasons are a lack of awareness at the consumer end and the quality of customer experience on most of those websites.

Singapore has a real opportunity to make up for lost time by learning from these international experiences and combining that learning with the advanced technology and know-how that the Republic excels at. Our market research, conducted in August, shows the appetite for online insurance already exists.

A good 90 per cent of Singaporeans are comfortable accessing and purchasing insurance online.

With good-quality offerings and a simple customer experience, that latent demand can be converted to tangible results over the next few years.


Using new advanced tools such as robo-advisers, there is potential to introduce new bespoke life policies that are entirely customisable to each individual's needs, curated in real time in active response to a customer's questions.

This will allow consumers to make proper considered decisions on their insurance needs without the pressure of a face-to-face meeting.

It also far exceeds what is possible in a traditional meeting with an adviser and actively changes the conversation from "which insurance policy should I choose" to the creation of a policy that is personal to me.


We are fortunate that we have a government which actively introduces new initiatives and stimulus measures such as its Direct Purchase Insurance (DPI) initiative, which pushes the industry forward in an independent, non-partisan way.

MAS' MoneySense and CompareFirst websites are excellent initiatives and the industry should champion the introduction of simple tools that allow people to calculate the cover they need, including an assessment of the existing cover that they have in place.

We should also welcome the proposed initiatives to ensure people don't inadvertently end up leaving themselves under-insured or paying too much for cover they don't need.

This puts consumers at risk and leaves the industry open to allegations of offering poor value.

I see a bright, value-added and direct future for the insurance industry that will benefit everyone in Singapore.

The smart combination of clever government-led initiatives, alongside an industry that is ready to innovate, will change Singapore for the better.

It will also help further reinforce our nation's position as a leading global centre of financial services innovation. Carpe Diem.

This is an edited version of a story that was published in The Business Times yesterday.

The writer is chief executive officer of FWD Insurance, Singapore.

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