The Monetary Authority of Singapore has released a consultation paper, inviting feedback on initiatives to streamline data collection for specific insurance policies aligned with the Basic Financial Planning Guide.
The proposals aim to simplify the process for consumers, facilitating access to straightforward and cost-effective insurance products.
In collaboration with CPF Board and finance industry associations, MAS and MoneySense introduced the guide in October 2023 to assist Singaporeans in enhancing their financial well-being.
The guide offers a framework for individuals to proactively address savings, insurance, and investment needs. It recommends allocating up to 15% of take-home pay for insurance protection, with further advice on coverage for death, total permanent disability, and critical illness.
Six customised variations of the guide were released on Jan. 31, catering to different life stages.
MAS is proposing a reduction in the information required from financial institutions when providing recommendations on term life insurance and standard critical illness policies aligned with the guide's principles. This aims to simplify the consumer experience and encourage the provision of cost-effective insurance options within the guide's specified limits.
“The proposals seek to simplify the financial advisory process through which Singaporeans can obtain cost-effective insurance coverage. At the same time, the upper limits stipulated in the Basic Financial Planning Guide on insurance coverage and spending serve as safeguards to protect consumers’ interests,” said Lim Tuang Lee, assistant managing director (capital markets) at MAS.
MAS welcomes feedback on the proposals from financial institutions, consumers, and other interested parties until March 15.
