I was mis-sold by an insurance agent.
The one that masqueraded as an insurance expert in this blog.
It was some time back then.
An insurance adviser met up with me and mis-sold me an insurance policy.
It was a long time before I did realize that fact.
This is the story of how it has happened.
A Fraudulent Invite
I was a foolhardy and naive National Serviceman back then.
When the Aviva-SAF insurance scheme was introduced, I was busy with other matters.
When the insurance talk was over, I was left uninsured while doing a hazardous job.
Despite all my worries, the young bravado got better of me.
I continued to leave myself open to all risks.
Thankfully I did not meet with any mishap.
One day, I received a call from a stranger.
He introduced himself as Frederick (not his real name) and mentioned that he needed to meet me to verify some details about my friend.
He refused to tell me more till I met up with him.
Worried sick, I went down immediately.
He greeted me and told me that my friend had bought an insurance from him.
My friend then recommended me to him.
It all started with a lie.
I should have known better to trust Frederick.
The Placebo Insurance
After sitting down with Frederick, I agreed to buy an insurance policy within my meager budget.
I explained that I wished to have protection for my parents.
In addition, I forecasted a situation that I had to reduce my premium when my National Service was up.
He promised me that I could reduce the premium accordingly when my university education started without reducing the sum assured.
I was happy that I was able to get a perfect plan that catered to my budget needs.
However, I had no idea what plan I had purchased.
Nevertheless, it was assuring times for me (false feeling of security).
If anything untoward happened to me, my parents would be having some money.
I went on to serve the nation as best as I could.
Thankfully, I managed to get through NS safely.
Made a lot of good friends that stayed by me through the rest of my life so far.
One of them turned out pivotal as this story progressed.
The Vanishing Promise
National Service was over.
School term had begun.
With no more NS allowance, times were getting hard.
My parents had to pay for my tuition fees and my pocket money.
They had to upkeep my insurance premium too.
Then I recalled that I could reduce the monthly insurance liability.
After making a call to Frederick, he told me that I could come to his office anytime.
I made my way to the insurance company office.
He made me wait a while before appearing.
After telling him my concerns, he deftly evaded my intent by asking me if I had any other medical plan.
He pointed out that I no longer had medical coverage since I had left NS.
Instead of helping me process the request, he had asked me to add a hospitalization rider.
I did not know what that was.
It was not my intention to increase my parents’ burden.
Taken aback, I quickly left his office after telling him that I would consider.
I never got back to him.
To a 20-year-old, I was not experienced or firm enough to insist on my agenda.
Frederick took advantage of that.
Since I could not reduce the insurance payment, I did what I could.
I went out and worked on a part-time basis to make sure that I could pay for my own insurance plan.
The one which I had purchased without knowing much.
All these in good faith that my needs are adequately covered.
The Shocking $6,000 Discovery
Armed with a Bachelor’s degree, I went out and found a job that I would love.
It was the insurance industry.
After learning all about insurance, it was a natural step to do a financial review for me.
I was reluctant to speak to Frederick anymore.
In addition, I was lazy to look for my policy.
Thus, I called up the insurance hotline.
It was the worst customer service I ever encountered.
The customer service officer answered with the plan name but refused to give me any other information.
She kept pushing me to my existing agent.
I had about enough.
After declining her suggestion, I scoured every corner of my house.
I opened up my dusty policy contract and got a shock.
What I had was an endowment policy with a Personal Accident rider.
If I had passed away not due to an accident, my parents would receive a princely sum of $6,000.
Six lousy hundred Sing Dollars !
It was not even enough to cover my own funeral.
And I specifically wanted my parents to have money for their retirement, in the event of my untimely death.
Obviously, this insurance plan was not going to make that happen.
The Self Discovery
Angered, I wanted to cancel my policy at that moment.
However, it was not to my benefit.
Frederick had collected all his commissions and it would not hurt him in any manner.
Re-focusing on financial needs once again, I went out and get the necessary protection that I needed.
Buying a hospitalization plan.
Getting a term insurance with critical illness cover.
I buckled down and did everything myself.
It was possible for me to do so as I was in this industry.
Even though I was not in sales, I had all the requisite certificates to do it all by myself.
For next few years, I sat down with insurance agents whenever I had time.
Bus interchanges, shopping malls and even at IT show.
You probably had the same experience that it was not hard to find one.
I listened and countered with my arguments.
Most of them were taken aback by my sharp questions and some even requested for their seniors to handle them.
It was funny to recall that when some decided that they could not sell me on their policies, they decided to check if I was interested to join them.
After some time, I gave up.
I had lost all my trust in all financial advisers.
A friend in need is a friend indeed.
You would be surprised that I did not terminate Frederick all these while.
I reckoned that since he had received commissions from my policy, it was only right for me to continue receiving a calendar and a lame birthday greeting yearly.
However, my endowment policy did come with a bi-annual coupon payout.
I had an option to either bank it into my account or reinvest back to the insurer.
Since I was working, I wanted to choose the second option.
One of my NS buddies was Will
As I was unsure how to return the cheque, I asked for his help.
He could help me with that.
I finally decided to change my advisor to Will.
Even though he would not earn from my policies, he agreed.
He went through my financial portfolio and found it to be in good order.
I did not miss my free calendars as he would place them at my doorstep along with some complimentary CNY red packets.
He also agreed to service my spouse’s policy even if he would not receive a single cent.
When there were plans that I mentioned that I was looking out for, he would send me the information without my prompting.
He was a friend first before being my financial adviser.
Even though I was mis-sold a policy, I thought it was partially my fault.
I did not know enough or had much of an interest to learn then.
Leaving it to the stranger to decide on my future plan was simply irresponsible on hindsight.
Had I learn about even the most insurance basics, I would be able to differentiate between an endowment plan and whole life policy.
I would have recognized that a Personal Accident cover is not as good as a Term cover for my situation.
Most importantly, I would have the confidence to tell my adviser what I want and instruct him to execute my wish instead of trying to up-sell me in my times of need.
Some had been disappointed by friends who did not act in their best interest and mis-sold policies to them.
Having even the most rudimentary insurance knowledge may go a long way to help alleviate this problem.
If you are able to tell the different coverage, you shall be able to suss out easily whether your friend-advisor is providing you good recommendations.
Although I am main anti-establishment, I agree with the government notion to be self-reliant first.
For others to help you, you got to help yourself first.
In this context, you must read up on your own before deciding what policies to buy.
On a serious note, this is no different from buying other consumer products.
Going online to read the reviews of the best restaurants and graphic cards recommendations are akin to read up on insurance.
You have no problem with the former so why do you not do the same for the latter?
If you really think about it, insurance policies are a bigger, more important deal than having a higher FPS on your PC, isn’t it?
Being mis-sold is not the end of the world.
You can make amendments to your portfolio as soon as possible to ensure that you are covered where you want it to be.
I was lucky to realize and make changes before anything bad happens to me.
If you are reading till this point, it is reasonable to think that you are sufficiently piqued.
As it happens, we do have a rather simple yet comprehensive guide to life insurance here.
It is a great place to start learning and think about your own insurance needs and wants.
Do you have your very own tale to tell about your adviser?
Share it with us so that more people may learn.
www.ClearlySurely.com aims to eradicate the knowledge gap between consumers and Life Insurance. Our Vision is that one day, every Man, Woman, and Child will be properly insured.