SINGAPORE — The level of trust Singapore consumers have in general insurers and their intermediaries like brokers and advisers slipped in 2024, compared with the previous year, a study has found.
The 2024 insurance trust indicator study, commissioned by the local insurance sector to help improve confidence and practices, found that consumers’ trust in general insurers dipped to 73 from a score of 75 in 2023.
Consumers’ trust in general insurance intermediaries fell further — to 62 points in 2024 from 68 a year earlier.
However, consumers’ trust in life insurers edged up to 70 points in 2024 from 68 in 2023.
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Their trust in agents and financial advisers remains unchanged at 73 points.
The study, done between February and April, was commissioned by the insurance culture and conduct steering committee that comprises 11 industry players.
It was carried out by Forrester Consulting, which surveyed more than 3,000 consumers, more than 300 managers from small and medium-sized enterprises (SMEs), and 200 managers from larger companies in Singapore.
The annual study is part of the industry efforts to assess the levels of trust in the sector.
The study, to be carried out over a three-year period from 2023 to 2025, aims to identify areas where consumers’ and businesses’ trust in the Singapore insurance industry can be improved.
The aim is in line with the committee’s broader goal to elevate industry culture and conduct standards.
When asked for the reasons behind the scores, the committee’s chairman Khoo Kah Siang said the differences may be primarily attributed to changes in trust levels among consumers in the younger group between the ages of 20 and 39.
He said this group of consumers represents about 40 per cent to 50 per cent of the consumer base in each segment.
Besides consumers, the 2024 report also looked at the confidence levels of SMEs and bigger firms.
It found that SMEs’ trust in life insurers fell to 70 in 2024 from an earlier score of 77, while confidence in agents and financial advisers dropped to 64 points from 2023’s score of 72.
However, bigger companies have more trust in life insurers and their intermediaries. The scores climbed from 76 in 2023 to 79 in 2024 for life insurers, whose intermediaries’ score also rose — to 73 in 2024 from 69.
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Dr Khoo said the decline in trust indicator scores for life insurers among SMEs is most significant among smaller SMEs or those with between 26 and 50 employees.
The picture was more dreary for general insurers and their sales team.
SMEs’ 2024 trust score in general insurers dipped to 74 points from 76, while that in their intermediaries such as agents, advisers and brokers slid to 68 from 2023’s 71 points.
For bigger firms, general insurers’ trust score fell to 76 points in 2024 from 80 in 2023, while intermediaries’ score dropped to 69 points from 74 points a year earlier.
“The decline in scores for general insurers among corporates is most significant among larger corporates or those with 1,001 employees or more. Within the trust indicators, consistency was the indicator with the highest drop among corporates,” said Dr Khoo.
Despite the decline in trust levels in both consumer and company segments, the committee said general insurers’ trust indicator scores stayed within the moderate to strong levels.
So far, the committee has developed and released five best practice guidelines as well as recommended various initiatives for stakeholders.
It suggested that general insurers and the people who sell their products improve communication with customers, and to give clients better claims experiences.
For life insurers, agents and advisers, the committee proposed improving the quality of advice given to consumers by encouraging best practices and sending intermediaries for targeted training programmes.
Dr Khoo said: “Trust is built over years and we are taking a long-term approach to continually strengthen trust in Singapore’s insurance industry.”
It requires the efforts of all parties within the ecosystem, so having an action plan brings the industry one step closer to better standards in ethics, accountability, and customer focus, added Dr Khoo, who is also chief executive of Manulife Singapore.
The committee was established in December 2019 as an industry initiative, with the General Insurance Association of Singapore, Life Insurance Association Singapore and Singapore Reinsurers’ Association as founding members.
The Association of Financial Advisers and Singapore Insurance Brokers Association later joined the committee.
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This article was first published in The Straits Times. Permission required for reproduction.