The Monetary Authority of Singapore (MAS) has released a consultation paper to collect feedback on proposals to reduce the amount of information gathered by financial institutions from customers related to selected insurance policies.

The proposal concerns instances where financial institutions make recommendations on term life insurance and standard critical illness policies that are based on the Basic Financial Planning Guide, which was first released by MAS, MoneySense, financial institution collaborators and industry associations in October last year.

The guide provides Singaporeans with several methods to address their savings, insurance and investment needs to improve their overall financial wellbeing. A further six tailored variations to the guide were released on 31 January this year to better accommodate the financial planning needs of individuals at different stages of life.

The consultation paper’s proposal seeks to streamline and simplify the process for customers and encourage product providers to introduce “simple and cost-effective” products that meet the requirements of the guide and better suit customers’ needs.

“The proposals seek to simplify the financial advisory process through which Singaporeans can obtain cost-effective insurance coverage. At the same time, the upper limits stipulated in the Basic Financial Planning Guide on insurance coverage and spending serve as safeguards to protect consumers’ interests,” Lim Tuang Lee, Assistant Managing Director (Capital Markets) at MAS, said.