Almost two months after the Singapore government released guidelines for the deferral of insurance premium payments for those impacted financially by the COVID-19 pandemic, thousands of policyholders have filed their applications.
According to a report by CNA, many individuals and businesses in Singapore have felt the financial crunch after the government implemented its ‘Circuit Breaker’ measures to stem the spread of the virus. This led to some surrendering policies and others applying to defer premiums, just to make ends meet.
The report said that AIA has received more than 6,100 applications to defer premiums payments. Great Eastern has received around 2,800 requests, while Manulife had picked up more than 500.
As for the insurers, they are willing to extend this assistance to policyholders, and it’s unlikely that they would have a major negative effect on their financial standing.
“It is just an extension of the grace period,” Tan Lay Hoon, Manulife Singapore’s chief operating officer, was quoted as saying in the report. “We don’t think this is going to have much of an effect on our finances.”
Paul Brenchley, partner at KPMG Singapore’s financial services advisory, agreed, saying that the requests aren’t a huge concern for insurers.
“We’ve yet to see the mass unemployment levels that have been experienced in some other countries,” he told CNA. “These few thousand applications for deferral schemes are, at the moment, a fairly small percentage of [insurers’] local revenues.”
Premium deferments are allowed for up to six months, but insurers are willing to re-evaluate the limit in response to the unfolding pandemic, the report said.