Some representatives have questioned why they need to pass these new exams when all they sell are simple products. MAS takes the view that a good financial adviser should be able to explain the advantages and disadvantages and the risks of competing products – both simple and complex. The reality is that consumers today are faced with a wide range of choices. For example, a consumer wishing to invest and buy insurance protection has a few options. He may consider a participating policy or a regular premium investment-linked policy or simply purchase an insurance term policy and invest separately. He could build a portfolio of just plain vanilla stocks and bonds or include ETFs and futures or simply buy unit trusts. Each option has its own set of risk-return and cost considerations. The increasingly educated consumer will expect his representative to help him make sense of the complexity of the products and their suitability, even if he eventually settles on simple life insurance and investment products. Some other FA representatives feel that their academic qualifications are sufficient and should allow them an exemption from the exams. But consumers should have some assurance that the qualifications of the FA representatives meet a common standard. The examinations are industry-certified, and set a common standard and benchmark for FA representatives. It is important that all representatives, even those who have been in the industry for many years, stay abreast of latest market developments and products.
Ravi Menon: Financial advisory services – putting the customer first Keynote address by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Life Insurance Association 50th Anniversary Gala Dinner, Singapore, 26 March 2012. *  *  *  LIA President, Mr Tan Hak Leh Distinguished guests, ladies and gentlemen, good evening. Role of life insurance and financial advisory services Saving for the future, investing for returns, and protecting against risk – these are the fundamentals of managing our finances. Yet so few of us do it well. We are far better at earning an income than investing it and protecting against risk. To make matters worse, many life insurance and investment products are often not easy to understand. Many people are not financially savvy. And many of those who are, do not have the time to review the range of insurance and investment products available, and understand what is best suited for their needs. This is where financial advisory service comes in. Financial advisers can help people identify their insurance and financial planning needs and recommend suitable products. The roles of insurers and financial advisers are intimately intertwined. It must be so. Insurance protects dependants. Investments grow savings and wealth. How can we buy insurance without regard to our broader investment portfolio? Likewise, how can we invest without considering how well we are protected against death or disease? Life insurance and financial advisory services go hand in hand.