Naiyaga clarifies issue
28 November, 2017, 12:00 am
BSP Life has raised its concern and denied the insinuation by the Consumer Council of Fiji that they design and sell products with a view that they benefit from policy lapsing.
BSP Life’s managing director Malakai Naiyaga yesterday made the statement in response to a media article by the council on BSP Life’s life insurance product ‘Bula Life’.
A statement from the council CEO Premila Kumar yesterday said the council was expressing its disappointment in the manner life insurance policies were being sold to consumers by insurance agents.
Ms Kumar said recently a group of municipal workers between the ages of 30 to 55 years signed up for the Bula Life policy with BSP Life Insurance not knowing that the policy will mature when they reach 100 years.
She said manipulated by the insurance agent, the workers hastily signed and were informed of several benefits such as receiving lump sum payout after five years of consecutive premium payments and the use of policy as a collateral for loans in their various banks.
“After numerous premium payments and receipt of their original policy document, the workers learnt that maturity dates for their respective policy were set to expire when they turn a 100 years old.
“And they also found that the policy could not be used to obtain loan.
“This vital piece of information was not disclosed upfront when the insurance agent made the presentation.
“However, they were informed, in a presentation, of the benefits they will get from the policies,” she said.
In his response Mr Naiyaga said: “BSP Life has a suite of life insurance products to cater for various consumer needs.
“While some products have a savings or investment element, there are other products which are purely for protection and income replacement for survivors.
“The product in question Bula Life, is designed primarily as a lifetime protection plan, offering protection in the case of the untimely death of the life insured.
“Unlike term life insurance, the Bula Life product accrues bonuses each year BSP Life declares a bonus and this is paid out with the nominated sum insured.”
Mr Naiyaga outlines the key uses of Bula Life as follows:
* Protection and income replacement for surviving family members.
* Protection and income replacement for businesses on the untimely death of key partners/directors.
* It may be used as collateral against loans from credit suppliers.
He said BSP Life had endowment and anticipated endowment policies with varying savings terms and investment options which include periodical payments to policy owners. The Bula Life was not part of this group of policies.
“With respect to the specific incident referred to in the press release, BSP Life acknowledges that there was an incident which involved a group of municipal employees.
“It was an isolated case and has been dealt with appropriately with the customers involved.
“During the course of resolution, we had advised the consumer council keeping them updated until the matter was satisfactorily closed.
“Indeed, the consumer council had thanked BSP Life on its ‘swift and positive’ response to the complaint they raised to us.
“Subsequently BSP Life would have expected the consumer council to also mention the satisfactory resolution when highlighting this incident to the media but it chose to use a grossly misleading heading.
“BSP Life acknowledges that more work is required to properly educate and work with the consumer council on such matters.”
Meanwhile Ms Kumar said the council would like to see pre-disclosure statement outlining key information on the insurance product is made mandatory, so that consumers can make informed decision before entering into a contractual agreement.