In the latest news, MAS has announced several changes to the financial advisory industry under Financial Advisory Industry Review (FAIR). The aim was to reduce the cost of insurance as well as raise the quality of financial advice. How effective will they be? Firstly, we will look at the announced changes. Among them are
1. Launch of free website to compare life insurance and endowment products between insurance providers
2. Insurance companies have to make basic life insurance products available directly to consumers instead of only through agents
3. Balanced scorecard remuneration framework with KPIs for financial advisers
4. FA firms will have to set up independent sales audit departments to sample 5 per cent of the transactions of each sales representative every quarter with reports given to MAS.
5. Educational requirements to be raised
6. Increased capital requirements for financial advisory firms
Changes that were dropped include capping the first year …