In the world of wealth management, much of the discussions traditionally revolve around choosing the best investments and adopting a suitable asset allocation to match risk appetites. Very little used to be said about insurance protection, a major oversight that has started to receive growing attention during these times.
Health insurance protects policyholders by taking care of large medical bills, allowing them to recuperate without worrying about their finances. Life insurance ensures that loved ones are provided for in the event of a debilitating illness or untimely death.
The pandemic has prompted many people to reassess their life priorities and a greater awareness of the need to plan and prepare ahead - whatever the future may bring.
According to last year's Agility Research & Strategy's WealthLens™ Singapore study, wealthy Singaporeans value mental well-being and physical well-being as much as financial well-being. Health and wellness are important because they contribute directly to improving the quality of life.
In the case of wealthier individuals and families, the benefits of insurance can extend to areas such as estate planning, tax optimisation and debt risk mitigation.
Take, for example, an entrepreneur whose wealth is tied up in a business or in assets that are illiquid. Insurance for him or her can provide much-needed instant cash or an income stream for loved ones should something unexpected happen.
In addition, insurance policies and payouts are usually treated as separate from other assets, and are therefore less likely to be entangled should there be disputes in future. In countries where there is an inheritance tax, life insurance may be a more tax-efficient way of passing wealth to family members and creating a legacy.
Growing wealth and health
The AIA Group has served customers and communities across Asia for more than a century. This commitment to make a significant, positive impact is reinforced by AIA's brand promise of helping millions of people live healthier, longer, better lives by empowering people to understand and better manage their health, while meeting their long-term savings and protection needs.
Ms Melita Teo, chief customer and digital officer of AIA Singapore, says, "Becoming wealthier isn't always better if it comes at the expense of time, freedom and health. The goal of growing your wealth and well-being must go hand in hand."
"AIA has been serving generations of families in Singapore for more than 90 years. We deeply understand what matters to our customers, which is to be financially prepared through all life stages while also having the health to enjoy their best life with their family," she adds.
With in-depth understanding of the High Net Worth (HNW) segment, AIA Singapore launched Wealthbeing by AIA - the pairing of wealth and well-being - as it accelerates efforts to meet the underserved needs of High Net Worth Individuals (HNWIs) to grow their wealth for the long term while protecting their lifestyles from market volatility as well as unexpected life events.
To this end, AIA Group set up AIA Investments, an exclusive investment arm that focuses on delivering superior long-term sustainable returns for its clients. Through partnership with best in-class asset managers, the investment arm created AIA Elite Funds comprising a strategic mix of equities and bonds that is targeted at providing optimal returns and financial stability over the long run.
AIA Investments is responsible for managing over US$330 billion (approximately S$445 billion) in assets^ and has one of the largest teams in the Asia-Pacific region, with over 250 investment professionals.
Apart from helping HNW clients grow their wealth, AIA's Platinum product series is specially curated to help them leave a legacy for future generations and plug gaps in their health and medical coverage.
For example, the AIA Platinum Wealth Elite under the series is an investment plan that combines access to top, global fund managers with features such as life protection up to the age of 122 and AIA's "No Lapse Privilege".
The "no lapse" feature guarantees protection for at least the first 15 years of the policy regardless of the underlying fund's performance, provided all regular premiums are paid when they fall due and no withdrawals beyond the income withdrawal limit are made.
Insurance representatives with private banking skill sets
In 2019, AIA partnered the Wealth Management Institute (WMI) to become the first insurance organisation in Singapore to provide AIA insurance representatives with the same level of training, assessment and Institute of Banking and Finance Singapore (IBF) certification as private bankers.
Today, AIA remains the only insurer who upskills AIA insurance representatives with both the Client Advisor Competency Standards (CACS) regulatory examinations and WMI's Certified Private Banker qualifications to achieve the IBF Qualified Private Banking certification.
Having a holistic view beyond insurance, specially trained AIA insurance representatives are able to better value-add to clients' investment and insurance portfolios to enhance their overall well-being. The training enables AIA insurance representatives to understand the wealth management challenges faced by HNW clients. For complex scenarios, they are able to collaborate with professionals such as lawyers, tax and trust consultants to address client needs.
AIA Singapore, in partnership with WMI, will be sending 1,000 AIA insurance representatives for a wealth management programme by 2023 to better equip them with the competencies and knowledge to serve the rapidly growing affluent population in Singapore.
Financial services director Eline See, who has been with AIA Singapore for 25 years, is part of a team of AIA insurance representatives with the necessary private banking skill set to provide top quality financial advisory to the affluent and HNW segments.
Besides advising clients on their investment and insurance needs, Ms See helps them with legacy and succession planning. In the case of one particular family, she put together a business insurance plan and arranged for a lawyer to draft a "buysell" agreement to provide clarity on how the construction business will continue if a partner dies or decides to exit the company.
Ms See is a Certified Financial Planner (CFP) and possesses certifications in private banking and wealth management from IBF and WMI.
It is important that HNW clients regularly assess their portfolios with the help of a financial expert to make sure the holdings are aligned with their investment, succession planning and legacy planning needs. "It is important to consider the risk of every asset and not just focus on returns," she says.
For long-term investors, such reviews should ideally be conducted every six months while short-term investors should check in far more regularly given the present market volatility.
Clients of AIA receive professional advice and regular reviews of their portfolios from dedicated AIA insurance representatives.
Infographic: Sph. Source: Agility Research & Strategy's WealthLens™ Singapore, 2021
Bespoke loyalty programme
Wealthbeing by AIA includes a bespoke AIA Altitude Programme that caters to clients who own and maintain AIA policies with total annualised premiums of at least S$10,000 a year. There are three membership tiers to the programme, namely AIA Altitude, AIA Altitude Platinum and the newly introduced AIA Altitude Pinnacle for ultra-highnet-worth clients.
Clients who qualify for AIA Altitude Pinnacle get access to a suite of privileges including advanced healthcare services, complimentary will writing service as well as exclusive perks and event invitations, among others. Clients with total annualised premiums of at least S$100,000 qualify for the AIA Altitude Pinnacle tier.
"Wealthbeing by AIA is the future of wealth planning, where legacies are forged not only on wealth but also on health. This holistic approach transcends financial horizons to maximise growth and fulfilment for policyholders and their loved ones," says Ms Teo.
Pursuit of sustainable investing
Last year's Agility Research & Strategy's WealthLens™ Singapore study also revealed that sustainability is an important issue to HNWIs. Four in five of 300 people surveyed hold Environmental, Social and Governance (ESG) funds in their portfolios.
AIA shares the belief that socially responsible investing can help bring about positive changes to the world we live in.
Among other things, the AIA Group recently doubled down on its ESG commitments by selling off almost US$10 billion of investments in coal mining and coal-fired power business and set a target of achieving net zero greenhouse gas emissions by 2050.
Traditional wealth management involves maximising returns and minimising risk so that clients become richer in the future. But the definition of wealth has evolved, with greater attention given to staying healthy - physically and mentally - and achieving peace of mind so that future generations can live in a cleaner and greener world.
Visit www.aia.com.sg/en/wealthbeing.html for more information on AIA solutions to help you elevate your wealth and optimise your well-being.
Footnote:
^As as June 30, 2021
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