Ms Wong Sze Keed, President of the LIA Singapore
Distinguished guests
Ladies and gentlemen

1. Thank you for inviting me to speak at this year’s LIA luncheon. I am honoured to be here in your annual event, as you celebrate your achievements for the year. 

2. As you mark your achievements and look towards what is ahead for next year, I’d like to share with you some of my thoughts today using the acronym ‘CRAFT’. As many of you will know, CRAFT typically refers to Comprehensive Risk Assessment Framework and Techniques – a term we use for our risk assessment framework for financial institutions.

3. But I will be talking about a different ‘CRAFT’ today."
 
CONGRATULATIONS

4. Let me start with C – which stands for ‘Congratulations’, which are certainly in order today. As Ms Wong Sze Keed mentioned in her opening remarks, the industry has had a good year of growth, with total weighted new business premiums increasing by close to 20% in 2024.

5. I also want to congratulate LIA on your smooth leadership transition. The true measure of an organisation’s resilience isn’t just its ability to weather today’s challenges, but also its preparation of those who will navigate tomorrow’s waters. To Mr Dennis Tan, thank you for your leadership of the LIA, your hard work and contributions over the past two years. To Sze Keed, congratulations on your appointment. MAS looks forward to close engagement with you and the elected LIA MC team as you collectively tackle the various areas you touched on in your speech. These are very much aligned with our focus areas.

RETIREMENT READINESS

6. Sze Keed talked about boosting financial literacy earlier, which brings me to R – Retirement Readiness – i.e. helping Singaporeans be financially ready for retirement. We need to break this misconception that retirement is something you only plan for when you’re older. As age expectancy rises, planning needs to start earlier.

7. It is estimated that about 3 out of 4 Singaporeans do not have a retirement plan, and 2 out of 3 retirees wished they had started retirement planning earlier.

8. Helping Singaporeans retire well requires the coordinated efforts of the public and private sectors. Together, we can help Singaporeans look forward to their retirement years with confidence. Our public schemes (including CPF, Medisave, MediShield Life, CPF Life) provide the basic foundations or building blocks for a Singaporean’s basic retirement needs. These can be supplemented by private schemes and products, such as annuities, legacy planning and other services that are already provided by the insurance industry. Naturally, a lot will have to do with an individual’s desired lifestyle post-retirement and financial situation, which is why it is important that Singaporeans are first made aware of the additional available options. They can then start planning for retirement – as early as possible. 

9. MoneySense, our national financial education campaign website, provides guidance on how to get started. Another initiative rolled out more recently is the Basic Financial Planning Guide, launched in October 2023. It was a collaborative effort by MAS, CPF Board and industry associations, including LIA. The Guide offers simple and actionable steps that are tailored to an individual’s financial needs at six different life stages. It encourages Singaporeans to take proactive steps in managing their savings, insurance and investments, by providing actionable rules of thumb. It also makes reference to public sector schemes such as MediShield Life, CPF Life, Silver Housing Bonus and provides a holistic picture for Singaporeans. Yesterday, CPF Board and MOH announced the launch of the Health Insurance Planner, which will help Singaporeans plan their health insurance coverage by projecting their longer-term health insurance premiums. This is something that insurance companies and FA representatives can refer to while advising clients.  

10. I am encouraged that many of you have already leveraged on the Basic Financial Planning Guide when engaging your customers. Thus far, survey findings in 2024 are encouraging – 98% of financial advisory (or FA) representatives found the Guide's rules of thumb useful when interacting with customers. Earlier in January, we introduced a set of Industry Good Practices for incorporating the Guide into the financial advisory process to support fruitful and meaningful conversations with customers. I strongly encourage all firms to make use of the Guide and embark on some of these Good Practices.

AGING

11. Let me now move on to the letter ‘A’, which stands for ‘Aging’. Next year, Singapore is projected to attain “super-aged” status, which means more than 20% of the population will be aged 65 and above. By 2030, this will be about a quarter of Singaporeans. This shift requires us to think hard about how we design and deliver services to this group of customers who will have different financial needs and who may perhaps also face physical and cognitive challenges.

12. For instance, as customers age, they may need more assistance in accessing insurance services digitally, so we may need to think about features like larger text options, voice-assisted services, and adjustable contrast settings. Some customers may prefer to revert to physical interactions, so it is important to ensure that key documents like policy contracts and premium notices can reach these customers via a channel that works for them – for instance, via hard copy documents. 

13. MAS is actively engaging the financial sector, including the Association of Banks in Singapore (ABS), General Insurance Association of Singapore (GIA) and LIA, on enhancing financial services to support seniors and the less digitally savvy. LIA has already formed a committee and for a start, LIA will be introducing industry Guidelines on E-Statements & Practices to Prevent Unintended Lapsation of Policies. 

14. MAS is also taking steps to enhance pre- and post-transaction safeguards for vulnerable clients in the financial advisory process. These are higher-risk clients that are identified based on factors such as age, English language proficiency and educational qualifications. Safeguards for these clients have been in place since 2016, where financial advisers are expected to identify such vulnerable clients and perform pre-transaction call-backs to ensure that they understand the products they are purchasing. We refer to them as “Selected Clients” and will be making four key enhancements:

a. First, we will elevate the existing guidance (on identifying Selected Clients and conducting pre-transaction call-backs) to a Notice, making these requirements mandatory. 
b. Next, we will require a trusted individual to be present during the sales and advisory process for Selected Clients. This seeks to reduce the likelihood that Selected Clients will make ill-informed investment decisions. 
c. Third, we will strengthen pre-transaction call-back procedures by setting out key elements that should be covered in call-backs. 
d. Finally, to enhance accountability and transparency, we will require call-backs with Selected Clients to be audio recorded. And these can be shared with the client upon request. 

We intend to publish the revised legislation by the end of this month, for implementation by the end of 2025. These enhancements will help to raise industry standards and promote greater consumer trust, especially amongst Selected Clients.

FAIR DEALING

15. Let me now move on to ‘F’ – which stands for ‘Fair Dealing’. In May last year, MAS had updated the Guidelines on Fair Dealing, a key change being the expansion of the Guidelines to all FIs, and to all products and services they offer to their customers. I must emphasise at this point that fair dealing isn't just a regulatory requirement – it is also good for business. When insurers and financial advisors treat customers fairly, they trust you and will come back to you with their future needs. 

16. Under fair dealing, I would like to share three ‘Cs’ with you. The first ‘C’ is Communications – FIs must communicate simply and clearly to help customers make informed decisions. This means simplifying policy terms and avoiding technical jargon. Advertising materials must be clear, fair and balanced – not just highlighting potential returns, but also bringing attention to the risks and limitations. MAS has consulted on proposals to strengthen advertisement regulations, particularly to address misleading and anonymous advertisements. I would like to thank LIA members and all participating firms for your feedback. We aim to issue our response in mid-2025. 

17. Next ‘C’ is Competency. Another element for fair dealing is to ensure that representatives are competent and are able to provide appropriate advice to customers. To this end, MAS conducted a thematic review of FIs’ advisory and sales processes for long-term accident and health policies. Following the review, MAS will be issuing an information paper to strengthen practices in this area. The paper sets out our supervisory expectations, as well as the good and not-so-good practices we have observed. I urge FIs to look out for the paper in early April, and to benchmark yourselves against the good practices as appropriate.

18. Finally – Complaints handling. No one likes to receive complaints, but when complaints come in, financial institutions must handle them promptly, fairly and with empathy. In MAS’ review of FIs’ complaint handling standards last year, we observed some good practices. For instance, some institutions provide regular, meaningful status updates to consumers throughout the resolution process, going beyond generic responses. Others have implemented metrics to track the quality of their complaints handling – checking to see if responses have been provided accurately, whether root causes are identified correctly, as well as monitor for outcomes of FIDReC’s rulings. MAS is currently conducting a more in-depth survey among key players in the industry to ascertain the best practices in this area.

19. I encourage all financial institutions to take a fresh look at your complaints handling frameworks, to see where they can be strengthened. We understand that not every complaint reflects an actual service failure. However, each one deserves careful examination to better understand customers’ perspectives and earn their trust.

TALENT DEVELOPMENT

20. My final point on ‘T’ is for ‘Talent Development’. All the initiatives I've discussed today can only succeed with the right talent – people with the right hearts, minds, and skillsets. From underwriters and claims adjusters to data analysts and representatives, every role plays a critical part in shaping an insurer’s ability to meet the changing needs of its customers. We need to make sure that this pipeline of talent remains strong and flowing.

21. The Singapore College of Insurance – or SCI – is working with LIA, GIA, SRASingapore Reinsurers’ Association and SIBASingapore Insurance Brokers’ Association to consolidate internship requests and partner local universities and polytechnics to provide students with valuable hands-on work experience. The CPF Board and SCI will also jointly conduct regular engagement sessions with the industry next year. These sessions will help advisers deepen their knowledge of CPF-related matters, so that they can better guide their customers in retirement planning. There is also the Graduate Apprenticeship in Insurance (GRAIL) which SCI is launching in mid-2025. This programme will offer polytechnic graduates a new pathway to meaningful employment in the insurance sector.

22. MAS is also doing its part to build a skilled and adaptable workforce in the financial sector. We have committed $400 million from 2021 to 2025 to support the training of local finance professionals at various stages of their careers – from providing funding support for internships, apprenticeships and job rotation programmes at the pre-entry and entry levels, to upskilling and reskilling courses at the mid-career level, and overseas postings and leadership programmes at the senior level.

23. In 2015, we started the Asian Financial Leaders Programme (AFLP) to equip senior finance professionals aspiring to C-suite roles. I understand that Dennis himself was a graduate of the AFLP back in 2017. We will continue to build on this in 2025, with the launch of two new leadership programmes. The first targets those at managing director levels who show potential for higher senior leadership roles. The second targets high potential middle-level professionals at the Senior Vice-President and Director levels.

24. I encourage the industry to maintain this momentum in investing in people, and in nurturing the next generation of professionals who will lead the insurance industry. MAS and SCI will do the same.

CONCLUSION

25. Let me conclude by returning to the theme of CRAFT. The craftsperson's journey is one of continuous improvement, attention to detail, and dedication to excellence. The insurance industry must similarly keep refining its approach, whether in developing new products, enhancing customer service or building talent for tomorrow. Let's continue to work together to craft an insurance industry that serves all Singaporeans well.

26. Thank you for inviting me today. Please enjoy your lunch.

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