Tan Kin Lian's Blog: Unable to trust the agents

Thursday, October 28, 2010

Unable to trust the agents

Dear Mr Tan,
An independent financial advisor recently reviewed the policies belong to my wife and me. She recommended us to to surrender our policies and take up her whole life policy.

Both my wife and me are not familiar with the types of policies that we had purchased. My wife took the agent's advice and surrendered her policies. I decided to learn more about insurance before I decide. However, I am still very confused on whether to surrender my policy and has decided to write in to seek your advise.
I currently hold (details of policies provided ...) I am really confused because I asked a friend who is also an agent for help. She reviewed my policy and told me not to cancel it and instead asked me to add another whole life policy costing another 4k a year!

REPLY
My general advice is never to surrender a policy to take up a new policy. Each life insurance policy is costly and each time you make a change you incur the upfront cost all over again. In fact, most life insurance policies give bad value to the policy and should not be taken up in the first place. So, if you give up an existing policy to take up a new policy, you are most likely to commit a big mistake the second time.

The financial adviser is well trained to present figures (and often in a misleading fashion) to confuse and take advantage of the consumer (who is likely to make a bad decision).

Read these two FAQs
http://tankinlian.com/admin/file.aspx?id=178
http://tankinlian.com/Admin/File.aspx?id=64

5 comments:

zhummmeng said...: You can hardly run away from conmen and conwomen.Left or right you bounce into one. You thought that your friend agent may not but no difference she strangle you further financially. She tried to be an angel but she was another devil in disguise.
For these agents review means to sell you one more wholelife.
Did they actually review your insurance policies? I doubt so. Many agents have no idea what review is. To them is to sell you another one policy.; October 28, 2010 9:31 PM
Spur said...: Please lar... asking any of these financial salesman and saleswoman to do review or to do so-called financial planning or insurance planning is asking to flush more of your hard-earned money down the toilet.

Asking you to surrender existing policies and then buy a new one is known as "twisting". This is highly unethical especially if the policies involved are participating, as you suffer big penalties for surrendering and huge commissions are being dug from your pocket. You should immediately complain to MAS about this so-called IFA.

No wonder MAS recently gave up giving individual licenses to IFAs. They realise IFA no different from tied agents or RMs --- all salesman only interested in pushing product sales. The only difference for IFAs is that they are able to source more high commission products from multiple companies to push to you. It is no secret that although IFAs can sell hundreds of products from many companies, almost all the IFAs only push a handful of specific products --- these are the highest commission products available in the market.

As for your agent "friend"... Why did she recommend you buy another expensive wholelife? You don't have enuf coverage? If so, why didn't she advise you to go back to your original insurer and add a term rider to your existing wholelife? This will be much MUCH cheaper. Of course lah ... she won't earn anything ... that's WHY! If she had given you the above advice, you should pay her $500 for professional advice fees. Most people don't want to pay for advice, that's why you get salesman tactics to push product sales.

And in the 1st place, your original agent also just push high commission wholelife for sales money. That's why you don't have enough insurance coverage.; October 29, 2010 11:24 AM
yujuan said...: Pity Mr. TKL.
He has to repeat umpteem times why people should not surrender policies to take up new ones. His advice has fallen on deaf ears.
Would people ever learn. If I were Mr. Tan, I would have given up.
There is a Chinese saying, the one closest to you is your real enemy, so never trust your usual insurance agent, esp one that is your friend or relative.; October 29, 2010 1:52 PM
zhummmeng said...: I mentioned many times.. many people are keeping a thief in their closet.
Your supposedly most trusted insurance agent is sucking your blood slowly without you feeling the pain.If you evaluated long before buying your first policy you wouldn't face this dilemma now. You should have asked for his qualifications, his integrity and honesty from third party. I am sure these agents you have are all NOT qualified, dishonest and only have tikam tikam certs. Is it a wonder both asked you to buy another wholelife product? As I said the word 'review' in their dictionary means to sell another wholelife. Someday the words 'review' and 'to sell a wholelife product' could be used interchangeably.Look out for it in your Collin dictionary.; October 29, 2010 8:44 PM
indianist said...: After reading your article i came to know when to surrender insurance policy. I am having 3 policy on my name and one family policy. The three are half of the maturity period Thanks for the information.....; August 17, 2012 2:08 PM