Why are some Financial Advisors unable to represent an insurance company and sell another company’s products, even if it's better?

Well, it depends on a few factors:

1) The Company's Sales Distribution Channel strategy.
Some companies prefer to have an exclusive branding.
It keeps things simple and efficient for the company and its agents.
Other companies prefer an expanded distribution channel / network.

Company DC Strategy via Universities example :
National University of Singapore doesn't have offshore programmes.
University of London and RMIT are outstanding institutions as well, but has offshore programmes in Singapore.

Retail Strategy:
Yes, Mercedes has a distribution network, you can go to the distributors to compare Merc, BMW, Audi, etc but you can also go to the Mercedes HQ as well.
But you don't expect to go to Mercedes HQ and find the guy sell you a BMW right?

2) Agents Working Style, Customer Purchase preference & Brand Loyalty

Some people prefer selling or buying 1 brand, Others prefer selling or buying multiple brands. That's just human nature.

I'm sure we all know someone who are hardcore brand loyalists. They will only buy Red Wings boots, Rolex watches, support Manchester United/Liverpool/Arsenal only, buy only Tiger beer etc.

3) As per any representative of any company, financial consultant or otherwise, our job is to represent the company we are working for, be it a tied agency, or an independant agency.

At the end of the day, our job is to provide you sound advice, and provide a solution based on what we can offer. Even amongst agents, we have different philosophies toward financial planning.

It's up to you to decide which product, financial strategy and consultant suits your way of living the good life :)

Hi Sj,

In this industry for insurance agents, there are 2 types, tied agency & independent financial adviser (IFA). A tied agency agent can only advise you what their agency is selling, though this might seem dis-advantageous for the client, it isn't necessarily so.

A tied agency's products are more straight forward, meaning if you have a claim, all you need to do is look for 1 insurer, and that 1 insurer has your portfolio in their system, so it's easier to make references as needed.

In regards to an IFA, yes they are able to show you the comparison between a minimal of 4 insurers, and you have the final say on which product will suit you the best. Usually people prefer as you can compare between price and see which is the most affordable for you. And there might be a mix and match of products among the different insurers, so it means that in the event of a claim, either you or the agent needs to remember which insurer covers what.

But when it comes to insurance, the agent is more crucial than just the product itself, so do meet up with agents and hopefully you find one who has the best chemistry with you and someone you feel that you really can trust