When meeting financial planning professionals, you might be confronted by namecards with a dazzling array of similar-sounding titles, including financial planner, insurance agent, financial consultant, relationship manager, financial services manager, and more.
We help you demystify what these titles mean, and what it means for the services and advice you can expect to receive.
All insurance and investment product distribution activities for consumers are regulated by the Monetary Authority of Singapore (MAS) under the Financial Advisers Act.
Technically, the term “financial adviser” refers to the registered corporate entity licensed by MAS to carry out activities like providing personalised financial advice and distributing financial products.
Individuals appointed by financial adviser firms to represent them to distribute products and dispense advice are known as financial adviser representatives. Depending on the type of the company they represent, these financial adviser representatives typically use different titles, such as insurance agents, personal banker, and financial consultant.
Insurance agents are authorised representatives of insurance companies, which means they are only allowed to advise on and distribute products exclusively from the single company they represent. Colloquially, they are also known as tied agents, and are usually self-employed – in other words, they are not employees of insurers.
In Singapore, it is common for banks to have tie-ups with life insurance companies to distribute insurance products. This arrangement is known as ‘bancassurance’. Personal bankers, or relationship managers, are employees of banks whose role is to advise you on and distribute products offered by the bank or their partner insurance company.
As mentioned earlier, financial advisers technically refer to companies, and not individuals. Financial Advisers are companies that are licensed to advise on and distribute insurance and investment products from multiple insurers and investment firms.
There are independently-owned and operated financial adviser firms, as well as financial adviser firms that belong to insurance companies, which operate alongside tied agents. There are also independent financial advisers, which is a designation that MAS only allows to be used when the financial adviser firm satisfies stringent criteria to qualify as ‘independent’.
The above are the three main categories of financial adviser representatives you will find in the market. Of course, individual firms and agencies may give their representatives other creative and fancy titles, such as financial consultants, financial planner, wealth advisory associate, or directors and vice-presidents.
These might be conferred by individual companies or agencies to denote seniority or attainment of certain specialisation, but have no bearing legally.