"Insurance (Amendment) Bill 2015" - Second Reading Speech by Mr Lawrence Wong, Minister for Culture, Community and Youth and Second Minister for Communications and Information on behalf of Mr Tharman Shanmugaratnam, Deputy Prime Minister and Minister in Charge of the Monetary Authority of Singapore on 13 July 2015
1 Madam Speaker, I beg to move, "That the Bill be now read a second time".
2 The House has just debated the Financial Advisers (Amendment) Bill 2015. The changes proposed in the Insurance (Amendment) Bill 2015 are to complement the changes proposed in the Financial Advisers (Amendment) Bill 2015.
3 The Monetary Authority of Singapore (“MAS”) has consulted the industry and the public on the proposals, and incorporated the feedback received into the Bill where appropriate.
REGULATING THE PAYMENT OF REMUNERATION
4 First, the Bill introduces amendments to effect the recommendation to limit upfront commissions and spread the total commissions paid on a life policy over a specified period. These amendments mirror those proposed in the Financial Advisers (Amendment) Bill 2015.
PARTICIPATION IN THE WEB AGGREGATOR
5 Second, to facilitate the comparison of life policies, MAS has collaborated with the Consumers Association of Singapore, the Life Insurance Association and MoneySENSE to launch a web aggregator for life insurance policies. The web aggregator, known as compareFIRST, is an Internet portal that enables consumers to compare the premiums, key benefits and features of life policies from different insurers. It helps consumers to make better informed decisions when purchasing life insurance.
6 The Bill will empower MAS to require insurers to submit information for the web aggregator and to specify the fees payable by insurers for the development, operation and maintenance, and use of the web aggregator.
MANUFACTURE AND OFFER OF SPECIFIED LIFE POLICIES
7 Third, the Bill will empower MAS to prescribe matters relating to the manufacture and offer of life policies, such as their characteristics, benefits and manner of distribution or sale, where it is in the public interest to do so. For example, MAS will be able to require insurers to manufacture and offer Direct Purchase Insurance (“DPI”) products. DPI products are simple life policies that consumers can purchase directly from insurers without commissions and financial advice. With DPI, consumers will have cheaper access to selected term life and whole life policies.
8 Madam Speaker, the initiatives that these amendments will give effect to will help to raise the standards and professionalism of the financial advisory industry, and lead to greater efficiency in the distribution of life policies.