Home' Trinidad and Tobago Guardian : June 8th 2014 Contents Your family is good to go. That s the miracle
of life insurance. You instantaneously create
an estate by signing your name on that doc-
Thomas said this is what will enable people
like Mario to continue their "dreams" for their
families, whether this was a tertiary education,
paying off for a house, or starting a business,
even though they were no longer in the picture.
He also saw the benefits of critical illness riders
to life policies which enabled the average person
to afford expensive healthcare.
"How many working class people can save
$500,000 to $600,000 to handle an ongoing
cancer situation? Or cardiac surgery? Most
people can t come up with that kind of cash
in an emergency. You have policies that are
Thomas added that possession of a life policy
was a sign of good financial health and man-
agement, particularly if one was able to maintain
the policy in force for a lengthy period. Owners
of life insurance can use their policies as col-
lateral to purchase property, Thomas said.
In the event of the demise of the policyholder,
the policy would pay off for the property and
the holder s family could still retain ownership
But, as enthusiastic as he was for pure life
insurance, Thomas was unabashedly critical
of "investment-linked" or mixed policies. These
combine a life insurance policy with and an
annuity or pension payment plan.
Insurance companies put the income arising
from the sales of these types of policies into
multiple business areas, hoping for a return
sufficient enough to keep the client ahead of
inflation in the future in his retirement years.
According to Thomas, their main fault was
that a return could never really be guaranteed.
"These modern policies...you don t know
what they are going to deliver to you. They
(the companies) don t know what is going to
be delivered to you. These move and fluctuate
with the stock market. Right now, for example,
what are investment-linked policies paying?
Nothing. Because the stock market is paying
nothing. This is a personal bias. Feel free to
say so, but the best form of insurance is rock
solid, ordinary life insurance."
Damian Carribon is an insurance salesman
attached to one of the larger companies in the
market. His day-to-day experiences convince
him that a move toward these "mixed" policies
"Even in programmes designed for critical
illness or disability, the possibility exists that
throughout the client s lifetime, the client may
not become critically ill or disabled and, as
such, quite possibly would want to be in a
position to recoup a certain percentage of the
premium they would have contributed over
the years. If you become sick or disabled, there
is money to assist with your medical and your
normal monthly expenses. If nothing happens,
there is money to help you with retirement or
some other expense you may have in the long-
term future. We try to make it win-win sit-
uation for the client as much as possible."
Carribon said changes in the way people
view life, work and retirement was responsible.
Using his own clients as reference points, he
said that generally people were thinking about
retiring earlier to enjoy what they have worked
so hard to earn.
Industry umbrella body, T&T Association
of Insurance and Financial Advisers (TTAIFA)
points to the economy to support Carribon s
assertion. In an e-mailed response to the ques-
tion of a shift towards mixed policies, TTAIFA
confirmed this was so.
"The economy has changed, so people s
lifestyles have changed and so, too, their needs.
The market has to respond to the ever changing
needs of clients."
A breakdown of statistics from the Central
Bank shows that the total number of insurance
sales for life insurance and annuities have
grown. In 2010, life insurance sales were only
5,803 above combined annuities. By 2011, sales
of annuities began to outstrip sales of ordinary
life by 10, 361. By 2012, this distance grew by
But, despite this, the consultants and agents
the Sunday BG spoke with felt there was a
significant ignorance about insurance. Thomas
blamed the industry and the agents for the
state of affairs.
"The product is very badly sold and very
Ince thought both the public and the agents
"An individual may not recognise the need
for insurance, or they may be ignorant of the
concept. Sometimes they may have had a bad
experience with a product or a practitioner.
But the need for insurance exists. Life is at
TTAIFA defended agents against the claim
acknowledging that while maybe the perception
of insurance as a scam, and its agents as
"smartmen" might exist, the fact was that
most agents were professionals and that only
a handful had done little to enhance their
knowledge over the years.
The umbrella body said it is registered with
the Accreditation Council of T&T as a training
provider and has invested hundreds of thou-
sands of dollars in developing and executing
courses for agents.
TTAIFA said that agents are being trained
to recognise the needs of their clients, build
relationships and sell according to those needs.
"They have to identify the relevant shortfalls
in their lack of life/term insurance to meet
their families present and future needs in terms
of mortgage payments, food, shelter, clothing,
education for their children etc should the
breadwinner become disabled, die too soon or
even live long where a proper pension is need-
The umbrella organisation said prospective
clients should take on the responsibility of
checking what industry relevant courses the
agent had done before doing business.
Carribon, meanwhile, believed there was
another area people needed to take a little more
"In my job, I realise a lot of people say the
government will pay me a pension."
The insurance agent said that the $3,000 a
month pension distributed by the National
Insurance Board may be unsustainable given
the finite nature of the country s oil and gas
resources. He said the possibility may exist
that future governments may cut back. In such
a case, he advised the public to be able to pro-
vide for themselves.
But does that mean you have to be insured
in order to provide for yourself?
Next week we interview two individuals who
do not believe this to be the case in Part II of
our series, "To insure or not to insure."
*not real name
JUNE 8 • 2014 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
NEWS | SBG5
Source: Central Bank
Agents: Govt pension's not enough
The economy has
changed, so people's
changed and so, too,
their needs. The
market has to respond
to the ever changing
needs of clients.
from Page 4
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