compareFIRST launched today. Actually It was launched yesterday night and I spent the night evaluating the portal.
For those who do not know, compareFIRST is a website which compares term, whole life, endowment and investment-linked products. It is probably the world first in the sense it is an initiative by the Singapore government which mandates (i.e. force) all insurers to upload their prices to the portal for all to see. Majority of the products on the portal cannot be purchase directly from the insurer with the exception of products that are labelled as “DIRECT”. None of the products can be purchase on the same portal itself. The portal’s sole purpose is for comparison.
For a long time, insurance prices are opaque to the consumer. Put it this way – insurance prices are not efficient in the sense that the information that a consumer needs cannot be found anywhere other than from their agents. With the compareFIRST portal, most of the information are on the internet.
In the compareFIRST portal, what you can do are:
Download the Product Summary (which I verified to be the same one you get from your agent):
Get Partial benefit illustration:
Get a listing of similar products although you can only compare 4 products at a time:
Problems with the Comparison
After trying it out for a few minutes, I immediately spotted a problem. The comparisons generated by the compareFIRST are actually quite meaningless for a person who does not know what he is looking for. It is more suited for those who knows exactly what he is looking for. Let me give an example.
I generated a quotation for whole life covering CI limited premium 20 years of sum assured $200,000 for a 3 years old boy using compareFIRST.
The portal generated a list of whole life products that ‘met’ the criterion but actually it generated a list of whole life products that are different from each other. For example, AXA Life Extentials Prime, NTUC Income VIvolife 125 and TM Legacy LifeFlex are all different animals and yet they appear on the list. AXA Life Extentials Prime covers early CI payout while Vivolife does not. The multiplier generated for me was 3.5x 1.25x and 1x for the respective product (in other words the protection value is radically different despite the basic sum assured to be the same). Also the structures of the products are different. TM Legacy LifeFlex does not have any revisionary bonuses unlike the other two. TM Legacy LifeFlex’s lack of revisionary bonus is significant and yet I cannot find it being highlighted in the comparison details.
I tried to push the system to see how buggy it was by trying to generate a quotation for $500,000 basic sum assured whole life and I found that it generated a couple of whole life products with 3.5x multiplier. This turns out to be a whopping $1.75 million protection value for the 3 years old boy! As many financial advisers know, the maximum protection amount for juvenile is quite low and hence the quotation is likely not valid.
Thus, an untrained person could be comparing apple and oranges. As a financial adviser, I could easily pick the similar products to compare. Of course, this assumes I already know what are the similarities. This brings me to the next point…
The compareFIRST is most useful for independent financial adviser (IFA). Majority of the products on the portal are distributed by the IFAs and it really helps to speed up the comparisons effort. As IFAs are already trained in the respective products, they can go to the compareFIRST and select the products they want to compare. As mentioned, the compareFIRST is most useful for those who already know what they are looking for.
Many of the insurance companies benefit illustration generating software are hard to use. Some does not even have an uninstaller while others run on Java that crawls like a tortoise even on a high power PC. One of the most irritating part is the repeatedly necessity to key in the adviser’s personal particulars for every new logins. Now, the portal speeds up the comparison significantly.
So I would say that the compareFIRST - which many advisers feared - turns out to be the best productivity tool!
For end consumers who are clueless, it is best to consult their financial advisers.
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