According to an article HERE, the competition in UK financial services is not working. The article said that the UK financial services companies have not been able to win market share by focusing on customer service and good value products because consumers do not tend to switch from providers who treat them badly. The article state 4 reasons why consumers do not tend to switch … [Read more...]
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These articles are about ethics and market conduct of financial advisers
What is the difference between financial planner and financial adviser ?
Question: Why does MAS regulate certain aspects of financial planning and not the full range of financial planning activities? What is the distinction between a Financial Adviser and a Financial Planner? Official answer from the Monetary Authority of Singapore (Source: Q3 of MAS' FAQ HERE ): The types of services provided by financial planners vary widely. Some planners assess every aspect of … [Read more...]
Buy an IT gadget to get free insurance or buy insurance to get free IT gadget?
As I was on my way to have lunch, this poster caught my eye as there was no IT shop in my office building for a very long time. It is Prudential giving away free Samsung Galaxy Tab 2, Asus Touch Notebook, Xbox 360 Kinect, Canon Ixus Digital Camera, etc. if the client buys a Prudential life insurance policy of at least 10 years period. This is how bad the financial industry has become. It seems … [Read more...]
A very short history on commissions rebates and the dark side of the force
(22 July 2013 update below on Providend) Here is a history of commissions rebates in the life insurance industry. Prior to 2002, life insurance agents were prohibited from rebating commissions to their clients. In 2002, MAS lifted the ban in rebating commissions. The rationale was because of new rules recommended by Committee on Efficient Distribution of Life Insurance (CEDLI) and the … [Read more...]
What has paying fee for financial advice to do with iPads and China funds?
There are numerous surveys that showed that consumers are unwilling to pay a fee for financial advice. The latest one was an online survey conducted by MAS which showed that 80% of the respondents are not keen to pay for financial advice. But the question is - what exactly is ‘advice’ in the minds of these respondents? The respondent to the survey questions will answer based on his personal … [Read more...]
ST Forum: Vital to regulate commissions (FAIR Review)
Monetary Authority of Singapore has decided not to cap the total commission a financial adviser earns. Instead, it is proposing to cap the first year commission. In my opinion, this will lead to an increase in cost to the consumer. I decided to write to the press to feedback. The following was published in Straits Times ST Forum page on the 22 January 2013: THE Financial Advisory Industry … [Read more...]
Question: Should I become a part-time financial adviser?
Question: “I am currently in the industry, but tied to a company in selling their products. “After almost a year in the industry, I have no doubts that I can perform and earn a decent or rather good salary. However, the thing is that, I would really prefer to do a comprehensive financial plan for consumers out there. I would like to be a financial planning professional, and NOT a GOOD … [Read more...]
Consumers are happy despite being cheated by financial advisers, says surveys conducted by the authorities
Insurance consumer's satisfaction is high - according to another consumer survey of 800 individuals conducted by LIA: 72 per cent are “Very Satisfied” and “Satisfied” with the life insurance industry as a whole. 69 per cent of Life Insurance Users rely on only one trusted agent. 92 per cent of Life Insurance Users who went through a full/partial fact-find in the past 3 years say they … [Read more...]
Up to 70% of financial advisers’ recommendations were unsuitable, says MAS mystery shoppers survey
MAS commissioned an external consultant to conduct a mystery shopping exercise in 2012 to determine the quality of advice given out by financial advisers[1]. The MAS mystery shoppers' statistics were as follow: 28% of the recommendations were suitable; 40% of the recommendations may be suitable; 30% of the recommendations were not suitable. Because ‘may be suitable’ means potentially … [Read more...]
The financial adviser is knowledge gap filler, says MAS (Part 2)
MAS says [1]: The second key role is to help clients understand the specific products they invest in. In this, financial advisers play an important leveling role in a disclosure-based regime such as the one in Singapore. In a disclosure-based regime, the issuer or distributor of a financial product has the obligation to disclose all critical information about the product, but the onus is on the … [Read more...]
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