So much talk about this monster known to senior folks as CPF Life. What exactly is this monster all about? An attempt was made to go through the materials provided by our Citizens' Coffer. It was not easy to understand though. Simple as it may sound, or written, it contains explanation only the person preparing them can understand.
My first impression on this scheme is one of skepticism. There exist much obscurity in the way the premium is being presented. End of the day, it is as lucid as a pool of muddy water in the middle of a mud track.
In simple term, can we classed this CPF Life as an insurance policy under what many a financial advisor will call Annuity Insurance? Pretty much so except it is an annuity scheme that carry a different name.
The Singapore insurance industry is rather well regulated, all financial advisors, whether they are selling life insurance or general insurance must strict adhere to MAS rules and regulations. This includes ongoing training throughout the year, to clock specific hours of training, never mind the training sessions use the same material repeated over and over.
Thus far, more than 30,000 members have signed up for CPF LIFE and committed about $1.5 billion to the scheme. If this is an insurance scheme, does it not make the staff of the Board qualified insurance advisors? And if so, have they been properly trained in accordance with the standards set by MAS, or for that matter, LUA Singapore?
How this scheme turns out eventually, only time will be the real witness. I have not come across anyone, yet, to vouch that this is a scheme specifically designed for the true benefits of our senior folks. There seems to be no lack of contentious views, you can read about one of them here - Beware of CPF Life Scam.
Our own CPF Board had now become our Bankers, Insurers, Investment agents and who knows what in the future.
Is it very complicated to let reputable insurance companies underwrite this scheme and present it to the public in a simple and straight forward annuity scheme?
Till date, how much is the premium for this 'popular and wonderful' product is not clearly spelt out, there is a provision for variables, which add to the uncertainty of this scheme. Indeed, one really wonders if the 30,000 or so that signed up really understand what they are in for.
Can some professional financial advisors advise?
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