Life insurance is out of date with ambiguous advice

In recent days, life insurance companies have continuously announced that they will stop selling investment-linked products and supplementary products from July 1, according to new regulations in Decree 46/2023/ND-CP.

Specifically, Manulife Vietnam has just sent a notice to agents and consultants about stopping selling the products: Future Gift, Peace of Mind, Happiness Journey, and supplementary products from July 1. Accordingly, products with supplementary benefits such as accidents, critical illnesses, etc. will no longer be sold in the main contract.

However, insurance contracts with investment-linked products or supplementary products that were in effect before July 1 will continue to be maintained according to the regulations and product terms in the contract.

AIA Vietnam agents also confirmed that they will stop providing Complete Balance, Complete Health, Ten Thousand Miles of Peace of Mind, along with Comprehensive Critical Illness, and Health Care 2.0.

According to AIA Vietnam, AIA's Complete Balance product currently has lifetime protection benefits up to 100 years old, a 25% bonus when suffering from serious cancer, and an additional % of the insurance amount depending on the type of disability caused by an accident.... However, from July 1, the new product will only have lifetime protection benefits up to 100 years old and receive 100% of the insurance benefits when suffering from total and permanent disability or death.

After July 1, supplementary and linked products will no longer be sold with life insurance products.

According to records, before July 1, 2025, many agents are recommending customers to sign contracts early to enjoy the full package of additional benefits.

According to financial experts, in the context of the life insurance industry in Vietnam facing many negative feedbacks from customers, not allowing the sale of insurance products linked with supplementary products is considered an important step to increase transparency and protect consumer rights.

Previously, consultants deliberately inserted many additional products into the main insurance contract, leading to a situation of confusing information, making it difficult for buyers to clearly understand what benefits they were paying for, what the payment level was, and under what conditions they would be paid. As a result, when risks occurred, many people fell into the situation of "buying insurance but not being insured", thereby losing confidence in the product and the business.

The clear separation of each insurance product helps customers understand, control and proactively choose according to their actual needs, instead of being led by complex product packages. At the same time, this also helps limit the profiteering behavior of a group of consultants chasing sales. For businesses and management agencies, this creates favorable conditions for monitoring, handling complaints and enhancing accountability.

Mr. Larry Truong, an insurance expert, said that the new regulation on separating main insurance products and supplementary products is very necessary. According to him, this helps consumers proactively choose benefits that suit their needs and finances, instead of being forced to buy an insurance package with many unnecessary benefits as before.

In fact, many life insurance contracts used to be "attached" to additional benefits such as hospitalization, critical illness... that not all customers needed. This increased costs but did not provide high protection efficiency. From July 1, customers can choose each additional benefit separately and only pay for what is really necessary.

Mr. Truong emphasized that the new regulation will force businesses to improve the quality of consultants, especially in terms of professional ethics and expertise, thereby helping the insurance market become more transparent. He also recommended that people should research carefully before signing a contract, understand the benefits, reasons for buying and the actual value of the product to better protect themselves and avoid future risks.

Source: https://nld.com.vn/bao-hiem-nhan-tho-het-thoi-tu-van-map-mo-196250523124425958.htm