As expected, in the aftermath of the news of  MAS’s  Financial Advisory Industry Review (FAIR), the media followed-up with more reports , particularly on the commission part. The 28th March 2012 issue of The Straits Times came with an article (Beware profit-driven insurance agents) on the sensitive issue.

Disclaimer: I have sold whole life plans and am still selling them.

A junior insurance agent was quoted “Term policies don’t make the company money, so we have to sell other policies like investment-linked plans or whole life policies. I only talk about term policy if the client asks me specifically about it“. Is this phenomenon common? From my own experience, yes! Not only junior advisers do that, even senior ones do that! Sure, some are driven to do it due to the commissions. However, there could be ones who do it due to pressure and sales quotas.

The ...