Why You Should Buy Insurance from Independent Financial Advisors

Alevin Chan

Alevin Chan

Last updated 16 March, 2017

Independent Financial Advisors in Singapore can help you choose the best insurance product in a confusing market.

There are many ways to buy insurance in Singapore, with the self-service model seen to rise in popularity.

However, due to the complicated nature of insurance products, we recommend dealing directly with an agent or financial advisor. When buying insurance, it is important to follow a simple but often overlooked principle: buy according to your needs. Dealing with an advisor gives you the opportunity to seek advice on your particular needs while making sure you aren't paying for more than what you need.

Buy Insurance According to Your Need

The whole point of insurance is to achieve protection for the duration which you are economically viable. As you go through life, you will generate the economic assets you require to take care of yourself. If you should suffer an unexpected incident that takes away your ability to continue to earning money, you want some means of replacing those lost earnings.

So you see, as a function, insurance is as pragmatic as they come. The entire industry can be boiled down to this premise: I’ll pay what I can afford to protect me from what I cannot afford.

With this understanding in mind, you will see then the only sensible way to approach insurance is to buy according to your need. (Hopefully, you’ll also see why getting sufficient coverage is not only a good idea, but how it’s vital for your economic well-being.)

For every available risk you need to cover against, chances are you can find several insurance plans catered towards it.

This presents an interesting challenge: how do you know which plan you should choose?

Without Choices, Good Decisions Are Impossible

Many Singaporeans buy life insurance plans through their agents, who usually represent a single insurer, such as AIA or Great Eastern. Because of the restrictions placed on Financial Advisor licences, most Certified Financial Advisors you encounter are only allowed to sell products from the insurance company they represent.

This means that in a typical encounter, the only choices you have are limited to Plan 1 from Company A or Plan 2 from Company A. And if you aren’t savvy enough to escape the sales pitch, you might end up buying a plan that is not really suitable.

(Of course, the insurance agent pitching to you will insist that that is the best product for you. That they know of. If their competitor has a product that is much better for you, they wouldn’t know it. Or wouldn’t tell you about it even if they did.)

All this is a very convoluted way of pointing out another often overlooked principle. To make good decisions, you need good choices. If you cannot find them, you cannot make a good decision.  

Are we all doomed, then, to waste hours of our lives talking to insurance agents from every available insurer, or spend all our Internet time downloading brochure after boring brochure?

Thankfully not.

Make an Independent Financial Advisor Your Best Friend

To make sure you’re making the best choice, track down an Independant Financial Advisor and make them your best friend.

Unlike other Financial Advisors, an Independent Financial Advisor is authorised to sell you products from at least 4 different insurers. The most qualified ones would have the entire market’s offerings at their fingertips.

Objectively, there are several advantages an Independent Financial Advisor can offer you. Firstly, they can quickly help you find an insurance plan that is truly suited to you. (Not all insurance plans are created equal - some are structured differently or offer varying degrees of flexibility.)

Next, they may be able to provide more well-rounded and strategic financial advice, as they are free to recommend products from multiple sources. This also allows them to offer more creative solutions for a closer match to your needs.

Thirdly, because they have access to all the plans offered on the market, they can help you find the most affordable or value-for-money plan. This means you can save money while still getting sufficient protection. They would also know at a glance if you are overpaying for your insurance plans.

And we’ll throw in a bonus benefit for free: Independent financial advisors would be among the most knowledgeable when it comes to market trends, simply because they need to keep up with all the latest news and developments out there.

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Alevin ChanBy Alevin Chan

A Certified Financial Planner with a curiosity about what makes people tick, Alevin's mission is to help readers understand the psychology of money. He's also on an ongoing quest to optimise happiness and enjoyment in his life.


An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.


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