FAIR But Not Simple

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The following article was written For the AFA Newsletter, 6 March 2014

It is hard to argue with the ideals of the five thrusts of the Financial Advisory Industry Review or FAIR, namely, raise competence of Representatives, raise quality of Financial Advisers, make Financial Advisory a dedicated service, lower distribution cost and promote a culture of fair dealing.

The FAIR dealing outcomes promoted before FAIR were also hard to fault since they are all for clients’ good and all Financial Advisers agree they must put clients’ interest first.  However, while the three main recommendations of FAIR, namely, balanced scorecard framework, direct sales channel for basic insurance and web aggregator, have good intentions, they will not be easy to swallow and stomach although they may eventually prove good for the industry.  All three recommendations are client-centric and, therefore, worthy but they will not be easy or cheap to implement.

Of the three major recommendations, the balanced scorecard (BSC) will impact IFAs most.  No doubt there was great relief for all Representatives and the insurers when commissions were not banned totally, but the BSC pushed forward in its place to raise standards of practice will definitely prove costly.  The additional costs include increased compliance (the need for independent sales audit), new software to implement the penalty system, customer call-back and mystery checks.  These costs come on top of the inexorable increase in rentals and salaries, and already high compliance costs to implement AML/CFT and PEP procedures.

There is certainly a need for BSC and its monitoring of the four non-sales key performance indicators – understanding customers’ needs, suitability of product recommendations, adequacy of information disclosure and standards of professionalism and ethical conduct.  The challenge is how to achieve uniform implementation among the widely different firms with different business models, KYCs and compliance structures.  Fact-finding is not exactly a science much less analysis of the facts and recommending solutions.  It is also widely agreed that it is harder to have agreement on what is suitable for investment than for life insurance.  No two clients are alike and no two representatives think the same way, but somehow the BSC requires the FAs to set standards which are bound to differ from firm to firm.  The expectation must be that, given time, the industry will find its level but how will this come about?  Even if the sales process can be standardised, and it does not appear to be anytime soon, e.g. a standardised KYC, clients differ and their needs differ, and their choice will thus differ.

It will also be interesting to see how the independent sales auditor will go about his work and how he will settle disputes with representatives and managers who are likely to be more experienced in the business than him.  The procedure for settling dispute has been left to each firm to handle and this will also lead to difference in standards.  Since financial penalties are involved, disputes are to be expected.  Also to be expected will be more changes when BSC is actually implemented in 2015.

Challenges To Success – Critical Factors And Decisions

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To be the best in our industry and profession,

1) We must seize opportunities and overcome challenges and dangers, and make right critical choices at major crossroads of our life and business

2) We need to know ourselves, our clients and our business environment well and construct and implement successfully effective strategies

How do we spot the opportunities?

How can we identify the dangers before they become problems?

How we do we make the right decisions in our personal, family and business life?

How do we succeed and move from mediocrity to excellence?

  1. SUCCESS ETHOS1) The secret of success is not knowing all the answer

    The secret is knowing all the questions

    2) Choice, not chance, determines destiny

    “Man is not the creature of circumstances; circumstances are the creatures of men.”  Benjamin Disraeli

    Goals are a preview of future events and experiences in your life.
    The difference between a dream and a goal is a plan.
    Your success can only be as big as your dream.

    A POEM

    I bargained with life for a penny
    And life would pay no more
    However, I counted my scanty store
    For life is just employer
    He gives you what you ask
    But once you have set the wages
    Why, you must bear the task
    I worked for a menial’s hire
    Only to learn, dismayed
    That any wage I had asked of life
    Life would have willingly paid

    Daily Targets and Activities

    When you know clearly what you want, you will wake up every morning excited about life.

    “It is not what you do each year, each month or each week, but rather it is what you do each DAY that determines your  level of success.”   Tony Gordon

    4) Winners Find Ways

    “We will either find a way or make one.”   Hannibal

    Faced with a wall, you can climb over it, break through it, tunnel under it, find a door.

    Winners Overcome Disappointments

    “Success is going from failure to failure without loss of enthusiasm.”   Winston Churchill

    6) Winners Never Quit – and quitters never win     (see Appendix I)
    7) Action

    Don’t let your learning lead to knowledge
    Let your learning lead to action
    8)      Conviction

    “One person with BELIEF is equal to a force of 99 who have only interest.” J S Mill

    9) Courage

    There are people who fear big waves and there are those who love surfing them
    10) Par Excellence

    “Lord, grant that I may always desire more than I can accomplish”.  Michelangelo

    The greatest enemy of tomorrow’s success is today’s success
    Focus on self-development, not self-fulfillment


    1) Singapore will be leading wealth management centre in the world
    2) Singapor ehas world’s fastest growth of millionaires
    3) Singapore has all the world’s leading firms based here
    4) IFAs have advantages over other channels
    5) Singaporeans still under insured and unit trust investment is still small
    6) Financial planning for fees is increasingly emerging as a viable business due to educated population and increasing wealth
    7) Inflow of HNWI expatriates in Singapore, e.g. British and European, QROPS
    8) Business-to-Business Agreements
    9) Corporate Business – ASME, SHRI, SICCC
    10) Social Media


    1) Move towards fees only or fee-based.  Both dangers and opportunities.
    2) Increase in regulation and compliance, CKA, exams
    3) Rising business cost – rental, transport, staff support
    4) Commoditisation and disintermediation – clients going direct
    5) Increasing complexity of products and need for professional indemnity, e.g. accredited investors
    6) Increasing volatility of markets and uncertainty
    7) Personal pitfalls
    - Health (stress)
    - Addictions
    - Family8) Loss of motivation – age, overcrowdedness, health
    9) Loss of confidence – information explosion, clients’ knowledge
    10) Lack of structure and priorities


1) Values and Principles
2) Relationships
3) Making Right Decision at Work
4) Practical Wisdom1) Values

Ken Blanchard
The no. 1 ranked value is Ethical Behaviour
The no. 2 ranked value is Relationship
The no. 3 ranked value is Success
The no. 4 ranked value is Learning


a) Think Well

  • Proactive
  • Purposeful
  • Future-oriented
  • Analytical
  • Logical
  • Intuitive
  • Creative
  • Relational
  • Sequential

b) Focus, Specialise, Prioritise

  • Concentration is learned through practice
  • Focus comes from clearer vision
  • Specialisation comes from clear mission
  • Priorities come from clear strategies and actions

c) Powerful Motivation

  • Doing what you enjoy – mental
  • Support by family – emotional
  • Happy and healthy you – physical
  • Spiritual dimension of our lives can have a big impact on our emotional being
  • Get rid of
    - Excess weight
    - Anger
    - Cynicism
    - Prejudices
    - Grudges
    - Arguments
    - Pet peeves
    - Selfishness

d) Know your level (water finds its own level)

  • Beware of
    - Overambition
    - Pride
    - Egotism
  • Just because you are an expert at one thing does not make you an expert on anything
  • No one can be a specialist in more than one or two areas
  • Know yourself and do not envy
  • When presented with options, we should work with what we do well and not be side-tracked
e) Read to feed your mind on
  • Your business
  • Your values
  • Self-improvement

    If you can read yet choose not to, you are really no better off than someone who is illiterate

    Every leader is a reader

f) Write
  • Your thoughts, plans, to-do lists, reflections
  • Write your pros and cons before deciding
  • Writing forces you to think more clearly
g) Evaluate
  • Remember your past success and failures
  • Gain understanding and learn what formed your personality, your drive, your skills, your intelligence, your emotions
  • Beware of praise, prejudices, envy
h) Have long-term vision
  • Think and act long-term.  You must have long range to help you from being frustrated by short-term failure
  • Marriage – avoid demanding but giving
  • Children – avoid absence
  • Health – avoid addictions
  • Money – avoid debts
i) Have quiet time alone
  • Relax
  • Refresh
  • De-stress
  • Creative

    “All men’s miseries derive from not being able to sit in a quiet room alone.”   Blaise Pascal

j) Beware of anger

  • Anger

    Anyone can become angry – that is easy.  But to be angry with the right person, to the right degree, at the right time for the right purpose, and in the right way, this is not easy.”  Aristotle

    Don’t get mad at the little thing

  • Cost
    - Broken relationship
    - Crushed spirits
    - Stress on our hearts
    - Hours spent on repair and reconciliation

    Anger is one of the most destructive forces in life

  • Triggers
    - An event
    - Internal response
    - External expression
  • Cause
    - We do not get our way
    - Someone offends us or puts us down
    - Disappointments
    - Confronted with need to change or improve something in our lives
  • Remedy
    - Identify your “hot spots”
    - Recognise your inner responses and emotions
    - Curb the external explosions
    - Strike at the roots
    - Why am I reacting?
    - Is it reasonable?
    - Is the incident worth the stress?

k) Be generous

  • Giving – it is God who gives you the ability to produce wealth

    Towards the poor, homeless, orphans, widows, down-trodden:

    “Give freely and become more wealthy; be stingy and lose everything.  The generous will prosper; those who refresh others will themselves be refreshed.”   Solomon

  • Give time

- Spouse, children, friends, co-workers, others
- Funerals, baptism, birthdays, children’s games, concerts
- Award presentations, graduations
- Visiting ill and aged

    • Give yourself
      “To overcome discouragement, do not focus on yourself; get involved in the lives of other people.”

Karl A Menninger, psychologist

        Get involved and start helping others.  There is no better exercise for the heart than reaching down and lifting people up.

      l) Watch out for icebergs

      • Moral temptations
      • Craving wealth
      • Busyness

        “Cultivate our spiritual garden.  When this garden is in proper order, it is a great place and there is an abundance of busyness of defiling noise.  The inner garden is a delicate place and, if not properly maintained, it will be quickly overrun by intrusive undergrowth.”   Gordon MacDonald

      • What not to do – Don’ts
        - Don’t be an egotist
        - Don’t give up when life is hard
        - Don’t get into debt
        - Don’t spend more than you can make
        - Don’t give up on your marriage
        - Don’t cheat on your spouse
        - Don’t cheat on your employer
        - Don’t neglect your children
        - Don’t neglect your parents
        - Don’t abandon your friends
        - Don’t drink alcohol excessively
        - Don’t do drugs.  Ever
        - Don’t smoke
        - Don’t use profanity; there are other ways to communicate
        - Don’t put other people down or speak badly of them
        - Don’t be dishonest in business, finance or speech
        - Don’t betray confidences
        - Don’t give up on God and religion

      2) Relationships

      Relationship Do’s (see Appendix II)

      a) Treat people well

      • Honour – who they are, not what they do
      • Respect – regardless of their gifting, position, status
      • Love – acceptance of their personhood

        Golden Rule:
        Do unto others as you would have them to do to you.

        Love your neighbour as yourself.   Jesus

      b) Compliment people (see Appendix III)

      • Why criticise when you can compliment
      • Be sincere.  Don’t use empty flattery.
      • Be truthful
      • Don’t make a big deal out of it – just do it
      • Be an equal complimenter.  Don’t play favourites.

        “Catch someone doing something good and tell him.”   Ken Blanchard & Spencer Johnson, “The One Minute Manager”

      c) Be real

      • Don’t pretend to be something other than what you really are
      • Be self-aware, be consistent
      • Be truly focused on other people, listen to them
      • Be genuinely caring and concerned
      • Get feedback from friends and family

      d) Be available

      “God does not begin by asking us about our ability, but only about our availability; and if we then prove our dependability, He will increase our capability.”

      Open door policy
      e) Disagree agreeably

      • Help me understand a little more of your thinking
      • You may well be right.  I need to think about it a bit more
      • I’ve thought that, too.  Here are some ideas I’ve wondered about.
      • Not:  Your idea is really stupid.  Let me straighten you out.

        Clarifying questions

      • Use equivocal and affirming expressions
      • I appreciate knowing how you think
      • That’s a good observation.  I’d like to weigh it more carefully.
      • I see you have given that a lot of thought
      • Have you considered …..
      • Never attack the person.  Let him know that your acceptance of him is not altered.

      f) Speak gently and be kind

      “A gentle response defuses anger
      But a sharp tongue kindles a forest fire
      Kind words heal and help
      Cutting words, wound and pain”   Solomon

      g) Say “thank you”

      Appreciation and affirmation motivate people more than money and rewards
      h) Call back

      He who is faithful in very little things is faithful also in much
      i) Don’t carry a grudge

      As far as it depends on you, live at peace with everyone
      j) Make and keep close friends

      “Not just acquaintances or colleagues
      There is a friend who sticks closer than a brother”   Solomon

      k) Meet with a small group

      Choose to meet and share openly on marriage, children, work, personal strengths, career issues
      l) Make love

      • People who truly love others leave an incredibly valuable legacy
      • Learn to love and make love permeate your love and relationships
      • Love your family, your employer, your employees, co-workers, neighbours
      • Love never gives up

      3) Making Right Decisions At Work

      • Work hard
        “All hard work brings a profit but more talk leads only to poverty.”   Solomon
        “Far and away the best prize that life offers is the chance to work hard at work worth doing.”   Theodore Roosevelt
        Give a full day’s work for a full day’s pay
        Do more than just enough to get by
        Don’t give up when the task is difficult
        Help others in their work
        Keep learning how to do your work better
        Hard work reveals your character

        Some turn up their sleeves
        Some turn up their noses
        Some don’t turn up at all

      • Leave some things undone – WORK SMART
        - Not everything that can be done should be done
        - Not everything that can do should you do
        - Deliberate choices not to get immersed in businesses that consume time with little results
      • Focus on contribution, not position
        Whoever wants to become great among you
        must be your servant, and whoever wants
        to be first must be your slave      Jesus
      • Learn to write well and speak well
        - People judge you by your communication
        - Writing is a learned skill
        - Keep a brief journal and write something everyday
        - Join Toastmasters Club
        - Teach a class
      • Make lists
        - Help you organise your day or week
        - Offload your memory and free your mind
        - Help keep you from forgetting things you need to do
        - Help you hold on to information that otherwise might be irretrievably lost
        - Relieve anxiety
      • Compete but don’t be competitive

        Good leaders will always seek out people who are more gifted and skilled than they are to better the team or company

        We develop our God-given gifts by education, practice, focus and training. We are stewards, not owners, of our gifts and capabilities.

      • Do what you say you will do
        - It makes you as a person of your word
        - It makes you a load lifter on your team
        - It makes you a more valuable employee
        - It honours your co-workers
        - It is the right thing to do

        Otherwise, undependable, unfaithful, a slacker, poor worker

        “Reliable friends who do what they say are like cool drinks in sweltering heat – refreshing.”   Solomon

      • Expect your leaders to disappoint you
        Nobody is perfect.  The best of men are but men of God.
        We expect leaders to be perfect
        We expect visionaries, pioneers, innovators, good managers to be positive role models
        To have razor-sharp judgement, unlimited energy and patience, exemplary families, faultless morals, available 24/7
        Sometimes they disappoint
      • Learn in-depth – don’t be shallow

      • Seek a tried and true expert who really knows his or her profession
      • Don’t be a mile wide and an inch deep
      • Finish

      • If you have been entrusted with a task, see it through to the end
      • People don’t get kudos for what they start, only for what they finish

      4) Practical Wisdom

      “The purpose of life is a life of purpose.”   Robert Burns

      The man without a purpose is like a ship without a rudder.”   Thomas Carlyle
      So many houses, so few homes
      So many people, so few friends
      So much rhetoric, so few words
      So many listeners, so few heard
      So many believers, so little faith
      So many wishes, so little hope
      So much passion, so little love
      So much laughter, so little joy
      So much sympathy, so few care
      So much courage, so few dare
      So many lessons, so few learn
      So much effort, so little done
      So many changes, so little difference
      So many partners, so few agree
      So much time, so few free


      Ideas from Dan Sullivan “How To Do Better”

      1) Break through present ceiling

      • Forget the past successes and repetition and stagnation
      • Think about the future prospects
      • Act in the present for the future through innovation and growth

      2) Break away from rugged individualism and discover unique ability teamwork

      3) Expect rewards only after creating value to others

      4) Set BIG goals or targets

      • Be prepared to impact relationships, organisational abilities and habits

      5) Be clear about what you want to have changed in your life professionally and personally

      6) Learn to get referral

      7) Delegate everything except genius

      8) Escape the causes of complexity

      • Too much happening, not enough time to think and learn
      • Too little security, not enough opportunity
      • Too few resources, not enough leverage

      9) Create a monopoly in the marketplace around an experience that only you can create for your clients

      • Make yourself crucial to the future success of your clients
      • Build structures, process and thinking patterns that allow you to create unique values
      • Always focus on creating increasing value for your clients, customers and prospects

        For example, provide leadership, relationship and creativity

        - Leadership provides directions to others in order to help them deal with feelings of confusion that arise out of living in an increasingly complex world

        - Relationship is providing a new sense of confidence when people feel isolated by change

        - Creativity is providing new capabilities when people are feeling powerless as a result of change

      10) Help others succeed

      • Help others ask the right questions and make the right decisions
      • Help others plan for the future
      • Help others seize opportunities

        “It is not the products that keep customers coming back, but the value those customers receive that they feel unable to get elsewhere.”


      1) Increasing demand for risk protection and wealth advisory

      2) Movements towards financial planning approach and fee-based compensation

      3) Big potential for IFAs if they achieve sufficient differentiation from the other channels and have sufficient resources

      4) Increasing costs and likely fee-based compensation will mean need to go upmarket and move to accredited investor clients

      5) IFAs will consolidate to keep up with higher paid-up capital and increasing compliance and operating expense

      6) Greater reliance on technology and social media

      7) Need to specialise and work in teams within company’s multi-platforms and multi-services

      8) Need to upgrade professionalism of both company staff and representatives

      9) Need to access regional markets and expatriate markets

      10) Need for business partnerships at representatives and company level

      Winners Never Quit

      Failed in business 1831
      Ran for the local elections and lost 1832
      Failed in business 1834
      Sweetheart died 1835
      Had a nervous breakdown 1836
      Lost a second election 1838
      Defeated for Congress 1843
      Defeated for election 1846
      Defeated for Congress 1846
      Defeated for Senate 1855
      Defeated for Vice President 1856
      Defeated for Congress 1856
      Elected President 1870

      A Short Course In Human Relations

      The six most important words
      “I admit I made a mistake”

      The five most important words
      “You did a good job”

      The four most important words
      “What is your opinion?”

      The three most important words
      “If you please”

      The two most important words
      “Thank you” or “Forgive me”

      The one most important word

      The least most important word


      After being married for 30 years, a wife asked her husband to describe her.

      He looked at her slowly, then said,
      “You are A, B, C, D, E, F, G, H, I, J, K”.

      She asked what does that mean.

      He said, “Adorable, Beautiful, Cute, Delightful, Elegant, Foxy, Gorgeous, Hot”.

      She smiled happily and said,
      “Oh, that’s lovely.  What about I, J, K?”

      He said, “I’m just kidding”.
      His eye is still swollen but it will get better.

      - Future-oriented
      - Analytical
      - Logical
      - Intuitive
      - Creative
      - Relational
      - Sequential

      Towards Better Transparency In Financial Services

      Filed in Best Practices | General Comments | Independent FA Leave a comment

      Everyone – regulators, consumer bodies, clients and even product providers and distribution channels – agrees that better transparency in business process and products is good.

      Yet, the reality is that there is still a lack of transparency in many areas.

      The letter in The Straits Times headed “Onus on insurers to boost transparency” by Larry Haverkamp was a follow up on the article by Lorna Tan “Excuse me, are you an independent adviser?”  The writer draws attention to advisers who do not qualify to be independent advisers posing as independent, and insurance products which pay high commissions but, in the writer’s opinion, are not favourable for clients.

      To be exact, there is lack of transparency in many other areas and there are more complex products than endowment and whole life insurance products.  Let me share my views and suggestions and what clients can do to bring about better transparency.

      Firstly, let me say that it is going to be a challenge to achieve greater transparency because, while everyone pays lip service to it, not everyone thinks it is good business to have simpler processes and products.  The reality is that there are more choices of product providers, channels of distribution and products today than 30 years ago.  And the products are getting more complex – just think about the structured products which failed and ruined millions of people’s lives.

      Just imagine also the challenge for a typical customer, Joe Tan, who likes to know whether he has any protection need and if so, what products he should purchase.

      Who does Joe call?

      • His tied agency friend?
      • His bank relationship manager?  And which one, since they change so often?
      • The financial adviser representative from his stockbroker?
      • The financial adviser representative from his general insurance broker?
      • The financial adviser representative from his wife’s licensed financial adviser who claims to be independent?
      • The financial adviser representative from his friend’s licensed financial adviser who remains silent about whether he is independent or not?
      • His moneylender friend who says he can connect him to someone who will show him how he can use his CPF investment to work better for him?
      • His real estate broker who says he also doubles as a financial adviser representative?
      • His union supervisor who says that he is also licensed to sell insurance?
      • His accountant who also says he has a licence to sell insurance?

      Now Joe is confused.  Since he has some time, he decides to call each of them to find out a few things.  And after making all the calls, he slumps on his chair, even more confused.

      The tied agent tells him all the products of the different insurance and premiums are about the same, but he ensures that he will give Joe the best personal service.

      A few others tell him that there are significant differences in the insurance products and premiums of different companies.  One even illustrated it by showing him a commission table of term insurance and the big difference in premiums, although the product is plain vanilla protection only without cash value.

      Only one said that he is independent and claimed to give “fair and objective” advice.  What about the others?  They did not mention what kind of advice they give.  But he remembers everyone claimed to “take care of his interests”.

      And one said he is “licensed”.  Are the others unlicensed?  But why are they still selling?

      And one said he is able to offer choices, unlike the agent.  But he does not hear anyone say he is an agent, but all used terms like “consultant”, “planner”, private wealth manager, wealth planner, investment planner, associate director.  So he scratched his head.  Who is the agent and who is the broker – terms his father mentioned over dinner.

      One said he is willing to give a rebate.  One or two others said rebating is illegal and said it is unethical.  Will he be a criminal if it is illegal?

      One said to be honest, “we are an exempt FA and not a licensed FA”.  What did he mean by “exempt”?  And why did he say “to be honest”?  Does it mean that the others are not honest?

      And why does this guy keep on telling him “just buy term insurance”, and the other insisted that it is better to buy whole life because it is “pow chiah” – sure to win.  And another adviser insisted ILP is best.  And he wonders, what is ILP?

      So trying to sort out his confusion, Joe decided he must find out more before deciding.  Good decision.  But how will Joe find out more – from friends, banks, magazines, Money Sense, newspapers?  Every one of his so called friends warns him to be careful as if he is facing sharks.  His remembrance of all the articles he has read also advised him to be alert and diligent as if he is treading a field rigged with mines.

      What can be done to make things simpler and less foreboding for people like Joe Tan?

      Firstly, I would like to suggest that, while we should not go backwards to the days when we had clear demarcation of business between banks, stockbrokers, investment, life insurance and general insurance, we should still return to the use of the legal terms “agent” and “broker” to describe the legal relationship between the representative and the company he represents (i.e. agent) and the legal relationship between the representative and the client (i.e. broker).  One way is to mandate that either of this term be used in brackets after the title of the representative.  Whether this broker is independent or not should also be stated.  For example:

      • ABC Financial Consultant (agent)
      • XYZ Associate Director (independent broker)
      • MNO Relationship Manager (non-independent broker)

      Secondly, whether the representative is licensed or not should be stated, since the representative who is licensed has to clear the MAS’ strict “fit and proper” criteria.  For example:

      • ABC Financial Consultant (agent, non-licensed)
      • XYZ Financial Consultant (independent broker, licensed)
      • MNO Relationship Manager (non-independent, non-licensed)

      These descriptive differences should be in the business cards and disclosure forms.

      A standard disclosure letter can be prepared by the regulator or the relevant association to explain the meaning of the different terms used – agent, broker, licensed, non-licensed, independent, non-independent, licensed FA, exempt FA, etc.

      The above practices will go a long way to inform clients about the status or identity of the representative he is talking to and the company the representative represents or is promoting.

      As for products, since the descriptive terms – whole life, endowment, term, annuity – are well-known – all products should have a basic description mentioning whether it is one of these or a combination.  From my experience, better transparency can be achieved if we adopt the following additional practices:

      1. Removing the 9% returns illustration from ILP illustration and adding one with minus 5% to show clients about the possibilities of losses.
      2. Requiring insurers to state the last five years actual bonus rate declared compared to their projection for cash value policies.
      3. Requiring insurers to split the premiums between the protection risk and the cash value benefit.  This will allow whole life polices to be used for keyman protection while the company only claims the premium for the protection as tax deductible expense.
      4. Requiring insurers to inform clients they should seek independent financial adviser advice if they desire to have product choices.

      In conclusion, let me say that the best long-term solution to bring about better transparency is to separate product providers totally from distributors (i.e. insurance companies do not have their tied agents) and to require all distributors to be licensed (both the firm and all their representatives) and all distributors are independent (to meet the higher standards for the benefit of clients).

      Differentiating product providers from distribution would eliminate most of the biases and inefficiencies now present in tied agencies which are expensive to support and limit clients’ choices.  Given clients’ general ignorance and inertia, tied agents perpetuate the situation of companies utilizing excessive marketing, advertising, promotion and incentives to sell their products instead of focusing on real value to clients.  The direct impact is that the bigger companies’ products have higher premiums.  Tied agents who are serious about the business would become independent advisers and representatives.

      Requiring all distribution channels to be licensed financial advisers and independent also, and all their representatives to be licensed as well, would raise standards immediately and significantly.  The total business production should not be affected but there would be a great saving of time of both the consumers and the representatives, and product providers would concentrate on improving their value to customers and not glitz and glitter.

      Given the rather open system inSingapore, it would b left to market forces to bring about any changes.

      Consumers need to press for better transparency and vote with their dollars.