Enhancing Medishield: Better Coverage for Singaporeans

As you may have already know by now, MOH is undergoing a major enhancement exercise on the medishield coverage for all Singaporeans. These changes will impact all existing medishield plans members as well as CPF members holding private integrated shield plan coverage from the major 5 insurers namely: NTUC, GE, Prudential, AIA and Aviva.

The new Private Integrated Shield plans will most probably be launched in the month of Mar 2013 and with some standardisation to the types of plans and benefits offered by the different insurers, the public will now have a easier time making comparison between plans and similar plans offered by different insurers.

That being said, most of these changes has been initiated by MOH which makes some long awaited changes to the basic Medishield plan. Do read the abstract from MOH website below or follow the link to get the full article published on MOH website:

"The Ministry of Health (MOH) held a public consultation in July and August to solicit feedback on the proposed MediShield enhancements to improve coverage and make MediShield more inclusive.

2     All the proposed enhancements received strong support from the vast majority of respondents (see Table 1 in Annex A for details). MOH will thus implement all the proposed enhancements.

3     MOH will also consider the extension of coverage to congenital and neonatal conditions as part of a broader review on supporting healthcare costs for children. This will tie in with on-going deliberations on encouraging marriage and parenthood as well as the “Our Singapore Conversation” (OSC) taking place to shape a consensus on the future of Singapore. For example, Prime Minister suggested earlier that a Medisave account could be set up for newborns and the Government could consider providing a start-up amount for childhood medical expenses. These ideas, including the proposed extension to cover congenital and neonatal conditions under MediShield will be surfaced for discussion at various OSC platforms.

4     Members of public also shared many additional ideas for further improvements to the MediShield scheme, some of which will be adopted for implementation in this round of review (see Table 2 in Annex A for details). Among them, MOH will be increasing the Medisave withdrawal limits for premiums, to fully cover basic MediShield premiums at all ages. MOH will also be removing the maximum entry age of 75 to help more uninsured but healthy elderly obtain insurance coverage. Other suggestions, such as for MediShield to cover outpatient treatment will require further detailed study as it is a major shift in MediShield’s focus and could have significant impact on the premiums.

MediShield Enhancements Effective From 1 March 2013

5     In summary, MOH, in consultation with the public, will make the following enhancements and changes to MediShield from 1 March 2013:

Proposed by MOH

a. Increase the maximum coverage age to 90;

b. Extend coverage to inpatient psychiatric treatment at $100 per day up to 35 days per year;

c. Increase the policy year and lifetime limits from $50,000 to $70,000 and from $200,000 to $300,000 respectively;

d. Extend coverage to short-stay wards in Emergency Departments; and

e. Increase the Class B2/C deductibles moderately by $500 for those aged 80 and below¹.

Additional changes arising from public feedback

a. Increase the Medisave withdrawal limits for MediShield and Integrated Shield Plans premiums from $800 to $1,000 for those aged 76 to 80 and from $1,150 to $1,200 for those above age 80; and

 b. Remove the MediShield maximum entry age of 75 to enable healthy uninsured elderly to obtain coverage.

Update of Premiums : read the full article here.

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Testimony

Testimony by Mdm Surya: Apr 2012

Mr Christopher Pua is my personal Financial Planner, the most extraordinary person that I have met in my 52 years, a very warm, helpful person during my husband stay in Hospital at TTSH.

Last year, my husband has some medical issue and have to be admitted in a Private Hospital. Christopher Pua was very helpful in getting all my bills in time for me to pay my credit card bill. His timing was so perfect that I got my cheque from AIA in time to settle the credit card payment. It was a shock when I total up the bill, it turn out to be $20,000 and above.

It was a great relief that we have coverage with AIA and Christopher was my agent. He is not like any other Insurance Agent, he would answer my call every time I have called him. And also ready to come to assist me in my time when I needed help, also in understanding about my policy.

THANK You Christopher.

Thank you for your assistance

Mdm Surya

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Most S'poreans not well insured: AIA poll

sources http://www.btinvest.com.sg: 22 Jul 2011 11:57 by Lester Hio

NINE out of ten Singaporeans are underinsured and will be forced to downgrade their living standards should anything happen, according to a recent AIA Singapore survey.

The 2011 AIA Singapore Nationwide Protection Survey, conducted between March and June this year, made five key findings with respect to Singaporeans’ perception of life insurance. It found out that Singaporean couples were not having either the correct or complete conversations about their family protection’s needs, and that it was acceptable for dependents to downgrade their living standards or remarry to make up for loss of income should anything happen.

Furthermore, there is the perception that insurance is not affordable, especially with rising costs of living, as well as a slightly misguided idea of what adequate insurance entails.

AIA’s survey was prompted by a 2007 study done by the Life Insurance Association (LIA), which found that the average Singaporean was underinsured by more than 65 per cent. It showed that the average Singaporean was covered for an average of approximately $165,000, when adequate protection, to maintain a similar level of living standards, was estimated to be $495,000.

LIA defines adequate protection as total coverage of approximately ten times one’s annual income.

AIA’s CEO and president of LIA Tan Hak Leh pointed out the discrepancy between knowledge and action.

“We found out that approximately six in ten Singaporeans claim to have a clear idea of how much they need to set aside for their dependents in the event of the death or permanent disability. However, only one in ten Singaporeans is sufficiently protected,” said Mr Tan.

AIA is rolling out a series of public awareness campaigns to inform and increase public knowledge of the insurance gap. It has also collaborated with the National Family Council to implement future plans that would help inform families about the insurance gap and to help build financial resilience for families.

Lim Soon Hock, chairman of the council, says that the collaboration would help with the council’s charter in building “strong, resilient and happier families”.

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More flexibility with new insurance law

More flexibility with new insurance law

Policyholders can now change nominees, but law not retrospective. -ST

Source: Thu, Sep 10, 2009
The Straits Times

By Lorna Tan, Senior Correspondent

INSURANCE policyholders can name beneficiaries and change them when the need arises, thanks to the introduction of a new nomination regime.

The long-awaited Insurance Nomination Law provides policyholders of life, accident and health policies with more flexibility and control over how to distribute policy proceeds.

The new law came into effect on Sept 1 and is seen as a vast improvement on the arrangement it replaces, which did not allow policyholders to change beneficiaries even after a divorce.

This meant that if a policyholder named his spouse or children as policy beneficiaries, he effectively created a statutory trust even if he did not want to.

Policyholders were prevented from changing their beneficiaries, or cashing in their policies without the consent of beneficiaries.

Many policyholders learnt of this only during divorce proceedings when they discovered that their former spouses still had a claim on their policies, or when an insured person's death sparked a bitter family dispute.

Some did not realise that if they named other parties as beneficiaries, such as grandparents, siblings, aunts and friends, they had no legal claim to policy proceeds.

The controversies surrounding such trusts prompted the insurance industry to do away with nominating beneficiaries in life policies in 2002.

The exception is NTUC Income because its policy proceeds are paid to nominees under a different law - the Cooperative Societies Act - allowing a cooperative member to make a nomination, which can include spouse, children, relatives and friends.

Under the Insurance Nomination Law, customers have two choices - to either make a trust nomination, or a revocable nomination.

With a trust nomination, the policyholder relinquishes all rights to the policy. This means that while he is still obliged to pay premiums, all policy benefits - living and death - belong to the nominees. An advantage is that policy proceeds are protected from creditors in the event of bankruptcy.

The policyholder can regain his rights to own the policy benefits only with the consent of all nominees. And only the spouse or a child of the policyholder is eligible to become a nominee.

With a revocable nomination, the policyholder continues to retain full ownership over the policy. He retains the right to change, add or remove nominees at any time without the consent of nominees.

The policyholder will receive living benefits and only death benefits will be paid to the nominees.

Unfortunately, the new law does not apply retrospectively to existing policies with previous nominations, but existing policies with no previous nominations are eligible.

Although the new framework applies to personal accident plans, general or non-life insurers who sell such cover would not be keen to offer their customers the option to nominate.

The General Insurance Association said that this was due to the fact that such policies are renewable either annually or on a monthly basis.

'Hence any nomination by a policyholder will be valid for the period of insurance only, which can be as short as one month,' it added.

Nevertheless, the new law has been welcomed by many.

Mr Darren Thomson, president of the Life Insurance Association (LIA), said: 'For estate planning, the new framework provides all-important clarity and hence peace of mind.

'It gives policyholders legal options in naming their beneficiaries, and a choice of control over the policy - whether they wish to relinquish or retain their rights during their lifetime.'

LIA added that the nomination process is straightforward with forms that are easy to complete.

To help consumers, a guide is available on its website www.lia.org.sg

Name your own Beneficiaries

Source: Straits Times Sep 7, 2009

Policy rules eased

By Lorna Tan

POLICYHOLDERS are now allowed to name beneficiaries and change them when the need arises under a new nomination framework which kicked in on Sep 1. The long-awaited-for Insurance Nomination law provides policyholders of life, accident and health policies, more flexibility and control over how they wish to distribute the policy proceeds. Customers have two choices, to either make a trust nomination or a revocable nomination. This is a vast improvement from previously as the law did not allow a policyholder to change his beneficiary, even after a divorce. Back then, if you have named your spouse or children as policy beneficiaries, you have effectively created a statutory trust. This is even if you did not explicitly want to. It means that you cannot change your beneficiaries, or cash in your policy without the consent of the beneficiaries. Many policyholders learn of this only during divorce proceedings when, to their horror, they find that their ex-spouses may still have claims on their policies. Or it comes to light only when the insured person dies, often sparking bitter family disputes. Many policyholders also do not realise that if they name other parties such as grandparents, siblings, aunts and friends as beneficiaries, these people have no legal claim to policy proceeds. The controversies surrounding such trusts prompted the insurance industry to do away with nominating beneficiaries in life policies since 2002. The exception is NTUC Income because its policy proceeds are paid to nominees under a different law - the Cooperative Societies Act - and this Act allows a cooperative member to make a nomination, which can include spouse, kids, relatives and friends. This is how the new framework operates. With a trust nomination, the policyholder relinquishes all rights to the policy. This means that while he is still obliged to pay the premiums, all policy benefits - living and death - belong to the nominees. An advantage of this is that the policy proceeds are protected from creditors in the event of bankruptcy. He can only regain his rights to own the policy benefits with the consent of all nominees. Only the spouse, or a child, of the policyholder is eligible to become a nominee under a trust nomination. With a revocable nomination, the policyholder continue to retain full ownership over the policy. He also retains the ability to change, add or remove nominees at any time without the consent of the nominees. The policyholder will receive living benefits and only death benefits will be paid to the nominees.

Company Travel insurance

source: Straits Times 8 Sept 09

Travel insurance

My husband's boss replied that half the claim would go to the company. It does not make sense.'

MADAM GERTRUDE TAN: 'Recently, my husband flew to Paris. On the return trip, the plane was delayed by six hours due to a technical fault. My husband's company had bought travel insurance for him, so his boss asked him to claim for the delay from the insurance company. Great Eastern Life was very efficient, and a cheque for $200 was made payable to my husband in due course. However, my husband's boss told him to return the cheque. My husband argued with her that what if there was a plane crash and I could not claim insurance. My husband's boss replied that half the claim would go to the company for the loss of an employee. I sought advice from the Ministry of Manpower, but the labour relations officer said the Employment Act did not cover this insurance rule. It does not make sense that an insurance claim is paid to the company. If there was a claim for lost luggage and it was paid to the company, it would not be fair to the employee who lost the luggage.'

AIG extends improbable rally

Source: Straits Times Aug 28, 2009

AIG extends improbable rally

AIG reported in July second-quarter earnings of US$1.8 billion. -- PHOTO: AP

NEW YORK - INSURANCE giant AIG extended its surprising rally on Thursday, rising 26.9 per cent amid frenzied speculation along with improved prospects on its ability to repay its massive government bailout.

AIG shares closed at US$47.84 (S$68.89), up US$10.15 in a day and some 400 per cent from recent lows on July 9, before the ailing firm announced its first profit in nearly two years.

The rally has spread to other troubled financial firms including Fannie Mae and Freddie Mac, the two mortgage finance giants taken over by the government nearly a year ago. Some analysts said the rally was a 'short squeeze' in which market players who had bet on a decline are forced to purchase shares to cut their losses, resulting in upward pressure on stocks.

Analysts at Briefing.com said the gains were a 'garbage rally' in the most at-risk financials, 'which began late yesterday afternoon with the massive short squeeze in AIG.' The surge 'wasn't the result of a specific news-related catalyst; instead, it started as a small rally in the afternoon, and as it started to gather steam and accelerate it forced shorts to panic and scramble to cover,' the note to clients said.

'Since AIG is the most volatile name in the 'at-risk financials' group, this created one of those momentum themes where coming in this morning, traders saw AIG continuing to squeeze in pre-market trading, and so they started to bid up the other low-quality financial stocks.' Andy Brooks, head of equity trading at T Rowe Price, said AIG 'looks like a stock that may be salvageable, so that has drawn investor attention. The same thing has happened to Fannie and Freddie.' But he noted that AIG stock 'is still down a down a ton from its highs' over US$1,000 a few years ago.

AIG was the largest single recipient of US bailouts, with the government pumping more than US$170 billion into the firm to keep it afloat and taking a controlling stake in the group in the process. It reported in July second-quarter earnings of US$1.8 billion.

The company said its return to profits came as some 'businesses stabilized and the company's results reflected positive valuation changes. AIG also achieved several important milestones in its restructuring programme.' AIG was on the verge of collapse last year after backing trillions of dollars in risky financial products amid a home mortgage meltdown that triggered financial turmoil.

Jon Ogg at 24/7WallSt.com said some of the AIG interest came on reports that new chief executive Robert Benmosche had talked with founder and former CEO Hank Greenberg about efforts to help rescue the firm. Joe Weisenthal at the financial website Clusterstock said the AIG rally was 'insane' since the government would have to be repaid before shareholders could benefit.

'Nobody knows what's going on, really. It's all rumor and speculation,' he said. Among other financials, Fannie Mae rose 3.78 per cent to US$1.92 dollars and Freddie Mac jumped 10.34 per cent to US$2.24. Citigroup, the bank with the biggest US bailout, jumped 9.07 per cent to US$5.05. -- AFP

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Race Against Cancer aims to help needy patients

Source: www.channelnewsasia.com

Race Against Cancer aims to help needy patients
By Cheryl Lim, Channel NewsAsia | Posted: 23 August 2009 1448 hrs

SINGAPORE: Giving strength and encouragement to those battling cancer. That's what the inaugural Race Against Cancer hopes to do.

Some 3,600 participants took part in the race. Among them was Dr William Tan who is currently seeking treatment for stage four leukaemia. Together with some 20 sponsors, they raised about S$465,000.

The Cancer Society is hoping to raise some $500,000 as part of the race's fund-raising efforts.

The money will go towards the society's various programmes.

These include the "SCS Help the Children and Youth programme" that helps children whose lives have been affected by cancer.

Support will be provided in four areas - the school allowance grant and bursary schemes, counselling, mentoring and family engagement services.

The society helps more than 1,000 needy cancer patients and reaches out to some
40,000 individuals through its community outreach and awareness programmes.

- CNA/ir

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S'poreans under-insured

Source: Straits Times Aug 21, 2009

S'poreans under-insured

Average person covered for only a third of $495k needed

By Charissa Yong
An average Singaporean needs life insurance protection of $494,851. However, his existing life cover is only $165,628 on average. -- ST GRAPHIC

THE average Singaporean now needs about $495,000 of life insurance, but is covered for only one-third of that amount - a drastic shortfall that needs urgent attention, an expert has warned.

According to a new report by Nanyang Technological University (NTU) Associate Professor David Yee, workers here aged from 20 to 64 are under-insured by as much as $525 billion nationwide.

An average Singaporean needs life insurance protection of $494,851. However, his existing life cover is only $165,628 on average, even after including mortgage insurance and CPF savings. This leaves a stunning shortfall of $329,223.

Prof Yee presented the report at a seminar on insurance held at the Intercontinental Hotel on Thursday.

A working adult's protection needs should provide enough cash to maintain dependants' current living standards. It should also cover any outstanding debts and funeral expenses.

This excludes the contribution of a surviving spouse. In addition, it needs to cover housing costs, allowances given to parents and children's expenses, including education fees.

Working men aged 30 to 49 have the highest protection needs as they have the highest income and are likely to have higher personal loans. Also, more dependants typically rely on them financially.

The male-female income gap is the main driver behind differences in the insurance needs of each gender, he said.

As couples get older, the husband tends to be the more dominant breadwinner, and so the financial burden of protection shifts away from the wife.

Those aged 30 to 39 were found to have the highest level of insurance ownership, but also the most protection needs.

Read the full story in Friday's edition of The Straits Times

charyong@sph.com.sg

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Prudential doubles losses

Source: Straits Times Aug 13, 2009

Prudential doubles losses

LONDON - PRUDENTIAL, the biggest British insurer, said on Thursday that net losses more than doubled in the first half on costs linked to the sale of Taiwanese operations, and as it awaited a new chief executive.

Prudential said losses after tax jumped to 254 million pounds (S$605 million) in the first six months of 2009 compared with a year earlier.

The group had in February agreed to sell part of its life insurance operations in Taiwan to China Life for just one Taiwan dollar.

Prudential's outgoing chief executive Mark Tucker on Thursday said the British insurer expected 'the business environment to remain difficult through the rest of 2009'.

Net losses had widened in the first six months of 2009 from 116 million pounds in the first half of 2008.

Prudential announced earlier this year that Frenchman Tidjane Thiam - currently the group's financial chief - would in October replace Tucker, who departs after 25 years with the group. Ahead of Thiam starting his new role, Prudential on Thursday said it was hiking its interim dividend by five percent compared to a year earlier after it had improved its capital reserves.

The dividend announcement helped Prudential's share price to rise by 4.75 per cent to 501 pence in morning London trade. The British capital's benchmark FTSE 100 index meanwhile struck its highest level for 10 months on fresh signs of a global economic recovery, traders said.

Prudential also said that its operating profit had risen six percent to 688 million pounds in the first half, helped by strong sales growth of its products in the United States.

'While we expect the business environment to remain difficult through the rest of 2009, Prudential is very well positioned to take advantage of any improvement in market conditions,' Tucker said on Thursday.

'I leave knowing that we have an excellent management team in place across the group and I am confident that Tidjane (Thiam) will continue to lead the group from strength to strength,' he added. -- AFP

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Life Insurance as part of your Asset Class

Source : Youtube.com CNBC.com

CNBC talks about allocating 5% - 10% of your assets portfolio into Life Insurance.

Watch to find out more.

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Ceiling fan blade hits diner

Source: Straits Times: 2 Aug 2009

By Nur Dianah Suhaimi Mr Lum's ankle was bruised and his boots were damaged when the blade came off at Cafe Vic.

IT WAS a long-awaited dinner between two childhood friends over their favourite food - durians.

But the durian buffet dinner at Carlton Hotel's Cafe Vic two weeks ago went terribly wrong for interior designer Marshall Lum, 30, and human resource officer Chur Sze Ying, 29.

While they were eating at the restaurant's alfresco dining area, the blade of a rotating ceiling fan above them came off with a loud bang, spun wildly around the area and hit Mr Lum on the ankle before landing on the floor.

Shocked, the pair immediately ran to the side of the restaurant because they feared that the ceiling fan, which was still rotating, might come crashing down on them.

Mr Lum's ankle was bruised and his snakeskin boots were damaged by the fan's blade, which was about 75cm long.

Despite the commotion this caused among the 20 or so diners in the area, none of the service staff came to check on him, said Mr Lum.

'We were just left standing there like clowns. The service staff who were standing around before suddenly ran off somewhere. Nobody came to ask if we were okay or to switch off the fan which looked wobbly,' he said.

They had to wait for 10 minutes before a restaurant staff member came by to check on them.

Mr Lum said he had to speak to three restaurant staff before he was referred to the manager. He also had to remind them to switch off the ceiling fan.

'Nobody seemed to know what to do. They were just passing the buck,' he said of the incident on July 24.

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CEO dies at triathlon

Osim Triathlon

Source: Straits Times : 2 Aug 2009

By Terrence Voon
Calvin Lee Wee Sing, 42, was pronounced dead at 2.45pm on Sunday, about one and a half hours after he ran into trouble during the swim segment of the Mix/Open relay race at the annual triathlon event. -- PHOTO: WWW.EASINGAPORE.ORG

THEY were aiming to complete their first triathlon relay together - as colleagues and as friends.

But their Sunday afternoon at East Coast Park ended in tragedy, when one of them died suddenly after taking part in the swimming leg of the Osim Singapore International Triathlon.

Calvin Lee Wee Sing, 42, was pronounced dead at 2.45pm on Sunday, about one and a half hours after he ran into trouble during the swim segment of the Mix/Open relay race at the annual triathlon event.

Mr Lee appeared to be struggling and disoriented in the water, about 350 metres away from the finish line of the 1.5km swim race.

He was spotted by a life marshal, who quickly called for a jet ski to bring the stricken swimmer to shore.

Paramedics and doctors tried unsuccessfully to revive Mr Lee - who was by then unconscious and foaming in the mouth - using cardiopulmonary resuscitation or CPR.

Attempts to jumpstart his heart using an automated external defibrillator (AED) also failed. He died later at Changi General Hospital.

Organisers say the cause of death is still under investigation.

Mr Lee - the chief executive officer of Deutsche Telekom Asia - is the latest fit and active person to die suddenly while exercising strenuously.

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Financial Planning - Does it sound too good to be true?

Sometimes, if you come across an investment or plan that sounds too good to be true, it probably is.

Watch this funny clip.

source: Youtube.com

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How to avoid unexpected Financial Problems

Watch this video and learn how to avoid unexpected Financial Problems.

Very funny.

source: Youtube.com

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Prudential doubles losses

Source: Straits Times Aug 13, 2009

Prudential doubles losses

LONDON - PRUDENTIAL, the biggest British insurer, said on Thursday that net losses more than doubled in the first half on costs linked to the sale of Taiwanese operations, and as it awaited a new chief executive.

Prudential said losses after tax jumped to 254 million pounds (S$605 million) in the first six months of 2009 compared with a year earlier.

The group had in February agreed to sell part of its life insurance operations in Taiwan to China Life for just one Taiwan dollar.

Prudential's outgoing chief executive Mark Tucker on Thursday said the British insurer expected 'the business environment to remain difficult through the rest of 2009'.

Net losses had widened in the first six months of 2009 from 116 million pounds in the first half of 2008.

Prudential announced earlier this year that Frenchman Tidjane Thiam - currently the group's financial chief - would in October replace Tucker, who departs after 25 years with the group. Ahead of Thiam starting his new role, Prudential on Thursday said it was hiking its interim dividend by five percent compared to a year earlier after it had improved its capital reserves.

The dividend announcement helped Prudential's share price to rise by 4.75 per cent to 501 pence in morning London trade. The British capital's benchmark FTSE 100 index meanwhile struck its highest level for 10 months on fresh signs of a global economic recovery, traders said.

Prudential also said that its operating profit had risen six percent to 688 million pounds in the first half, helped by strong sales growth of its products in the United States.

'While we expect the business environment to remain difficult through the rest of 2009, Prudential is very well positioned to take advantage of any improvement in market conditions,' Tucker said on Thursday.

'I leave knowing that we have an excellent management team in place across the group and I am confident that Tidjane (Thiam) will continue to lead the group from strength to strength,' he added. -- AFP

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Interests of policyholders protected: MAS

Source: Straits Times Aug 13 2009

Interests of policyholders protected: MAS

I REFER to last Thursday's letter by Mr Larry Haverkamp, 'Transparency in insurance: Policyholders underpaid'. He suggests that insurers have built up 'orphaned money' by under-declaring bonuses to participating policyholders. This is not the case in Singapore. With the introduction of the Risk-based Capital Framework in August 2004, insurers in Singapore are required to record the total amount of assets held in the participating fund as backing the liabilities to the participating policyholders. This means all assets in the participating fund belong to the participating policyholders. The issue of 'orphaned money' therefore does not arise.

In addition, there are rules governing the distribution of bonuses for participating funds. Under the Insurance Act, when insurers declare bonuses to participating policyholders, they can distribute not more than $1 to shareholders, as compensation for their management of the fund, for every $9 of bonus declared to policyholders. This ensures that insurers have an interest to manage the participating fund properly to achieve reasonable long-term returns for policyholders in accordance with the stated investment objectives of the fund.

These requirements ensure there is no incentive for insurers to intentionally under-declare bonuses in the hope of building up large amounts of 'orphaned money' to benefit their shareholders in future.

The Monetary Authority of Singapore (MAS) informed insurers in July this year that the definition of a participating policy in the First Schedule of the Insurance Act will be amended to provide even greater clarity that the assets of the participating fund belong to participating policyholders.

Angelina Fernandez (Ms)

Director (Communications)

Monetary Authority of Singapore

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Choosing a Financial Advisor.

Choosing the right Financial Advisor

source: www.imas.org.sg

Advice & Advisors

How to choose a good Financial Adviser Representative The representative must be honest, trustworthy and ethical If you sense a lack of sincerity and trust in the representative, you probably want to seek a second opinion. An adviser who lacks strong ethical standards and compromises ethics for convenience will not hesitate to compromise your position. The representative must be able to understand your financial responsibilities. If he has little or no idea about your situation after you have explained to him, and cannot determine your problem areas, then he probably cannot recommend you the solutions that meet your needs. The representative must think of your interests instead of his. Client centred is vital. An adviser who thinks of his interest before yours will probably recommend solutions that benefit him more than you. Your interest can be easily compromised in the process. The representative must be impartial and objective when recommending solutions. This is to ensure he is able to provide appropriate and effective advice in accordance to your needs. The representative must have access to a wide range of financial products. An adviser who is limited by products will not be able to offer competitive and creative products in his recommendation. The representative must have good knowledge of the various financial products available. It the adviser is ill-informed of the various financial products, he will not be able recommend solutions that have taken into consideration various alternatives available. The representative should possess good work ethics and habits. He has to be diligent and be prepared to serve your financial needs. An adviser that is often difficult to contact will frustrate you and cannot help you achieve your objectives. The representative must be a good listener. An adviser that is impatient will tend to hurry you into committing on the investment too soon. The adviser should gather sufficient information before proposing a solution. He must be prepared to conduct a thorough fact-find and involve you in the discussion stage to understand your situation well. This will ensure that he takes into consideration your situation before recommending you an appropriate plan. The representative must have a proper system of record keeping. This is to ensure that he keeps track of the history of discussions you have had with him regarding the areas of concerns, action plans and objectives. You should feel comfortable with your representative The client adviser relationship is critical to ensure that you are able to rely on him for effective and professional advice. Achieving your financial goal is a long term process that requires constant review, good advice and strong sense of discipline. If there is too much information that you cannot divulge to your adviser because you are not comfortable, then your adviser will not be able to advise you appropriately. The rep must continuously keep himself abreast of the changes in the industry. If you sense that he is unwilling to further his education and improve his knowledge, then you may be dealing with an obsolete adviser in time to come. The representative must be serious about his career and stay in the business in the long term. Only an adviser who takes his job in personal financial advisory as a long term career can ensure that he will be there to help you achieve your objectives. If your advisers are changed too often, you will get tired of ensuring that you deal with the right person and probably waste too much time trying to go through old data too often. We thank the Association of Financial Advisers (Singapore) for their advice on choosing a financial adviser. a blog on: Financial Planning Advice - Christopher Pua