SINGAPORE - The much anticipated move to allow consumers to compare life insurance products and to avoid agents and buy basic policies directly is expected to begin next month, according to a top regulatory official.
Mr Ong Chong Tee, deputy managing director for financial supervision at the Monetary Authority of Singapore (MAS), told a Life Insurance Association (LIA) lunch on Wednesday that the target launch date will be "early April".
The direct purchase channel and the web aggregator were key initiatives suggested by the Financial Advisory Industry Review (Fair) panel, which was set up in 2012 to raise industry standards and improve the distribution of products.
The MAS indicated in October that a web aggregator to allow consumers to compare the premiums and features of life insurance products would be ready in the first quarter this year.
The direct purchase channel, which will let people to buy products without going through an agent, was initially slated to be launched in the middle of last year but that was shifted to early this year.
As well as the Fair reforms, the life insurance industry has to prepare for proposed changes aimed at improving a risk-based capital framework known as RBC 2.
RBC 2 is designed to ensure insurance companies have adequate capital, taking into account the types of risks they bear.
Preliminary tests conducted by the MAS showed that most companies can meet the capital adequacy ratio (CAR) requirements under the proposals in RBC 2, said Mr Ong.
The current regime has a CAR of 120 per cent, though insurers typically have higher buffers of as much as 200 per cent.
Mr Ong said RBC 2 will see greater differentiation in the CAR for insurance firms with different risk profiles. Riskier firms will need higher buffers.