COMMENT POSTED IN MY BLOG
I think some kind of legal precedents will help to tidy up the industry. A body to advise on legal suits against roque insurance agents like CASE (Consumer Association) at affordable fee should be set up.
Once policyholders get litigious and know their rights and where to turn to for advise, this will then make insurance agents not to play play. Their recommendations must be able to withstand close scrutiny by third party review.
However customers must be educated on financial awareness. It is not about insurance only but about many areas of their personal finances. They have to know that all their needs are always competing for attention and the right and qualified adviser can help them to sort it out and not an insurance salesman.
Insurance agents are trained to sell, push and peddle products. They don't know about financial planning. Most are looking for get rich quick scheme and insurance selling offers them this opportunity. So unless the industry is cleaned up of these unscrupulous and unethical and cheats insurance salesmen we will continue to risk engaging one. A unified effort is needed.
To start with, only engage advisers with accredited tertiary qualifications like CFP, CFA, CPA, MFP or Master of science in wealth management.
REPLY:
I agree with most of the views.
High net worth people can engage advisers with tertiary qualifications. They can benefit from savings in tax through estate and tax planning.
Ordinary people should be educated about the simple facts of investments and encouraged to buy simple, low cost products available in the market. They do not need to pay high commission to advisers who do not add value to their financial planning.
Financial Adviser sometimes take a lot of time convincing people the need of investment and insurance.
ReplyDeleteWithout Financial Advisers, the public in generally be also be under-insured because there are not many people waking up in the morning, telling themselves that they need to invest or insure.
In the end, they will spend the money.
Probably one day, a Dept of Financial Education is set up by MAS, fully funded by the govt to advise people on the need of investment and insurance.
By then, more advisers will be eliminated and work in the dept on salaried basis.