Saturday, December 10, 2005

Buy Term Assurance

You can get a large life insurance cover, for a very low premium.

If you buy the term as part of an ILP, your policy will not lapse as the cash value from the ILP will pay the premium.

The premium for the term assurance can be kept level. For example, you can insure for $100,000 at age 30 for an annual premium of only $400 (male) or $280 (female). This is a level premium payable for 35 years. It does not increase with age.

You save 60% of the premium by selecting a decreasing term assurance (DTA), where the sum assured reduces gradually over the term. At age 30, the annual premium to cover a DTA of $100,000 for 35 years is only $157 (male) or $113 (female).

Many people need a larger amount of insurance when they are young. Their insurance need can reduce when they grow older, as they have accumulated savings.

Term assurance pays for death and permanent disability arising from all causes, i.e. accident, illness, etc. It provides wider coverage compared to accident insurance.

Crazy Horse Cabaret in Singapore



4 June 2005

So far, there is not much attention about the proposal to bring this cabaret to Singapore. But, I expect things to hot up later in the year. We can expect some Singaporeans to speak gainst this erotic show.

Some Singaporeans have a tendency to blow things out of proportion.

Look back 15 year. When the R(A) show was allowed in Singapore, there was a lot of discussion and hot air. Now, this matter is forgotten. It did not cause much harm anyway.

I think that history will repeat itself.

Friday, December 09, 2005

Handphone of accident can help

8 December 2005

New Paper

I refer to the letter, "How do we deal with drivers who lie?" by Mr Goh Ann Long (The New Paper, 7 December).

Mr Goh wanted to know how insurers deal with drivers who lie in their accident reports.

As NTUC Income insures about 40 per cent of all motor vehicles in Singapore, I wish to share our experience in dealing with such cases.

Each month, we handle about 2 000 cases of motor accident claims. About 10 per cent of these accidents are disputed by the parties, who give conflicting versions of the accident.

Our liability assessment officer interviews the parties, conducts a site visit if neccessary, and examines the photographs of the
damaged of the vehicle.

The officer is usually able to come to a decision on the appropriate apportionment of the liability. We try to be fair in our assessment and do not wish to favour any side.

If any of the parties disagrees with our assessment, they can ask for an independent expert to review the case or take the case to court.

The disputes can be minimised if both parties to the accident agree to sign the Singapore Accident Statement (SAS) on the spot.

We have recently implemented the use of MMS technology. Motorists are encouraged to use their handphones to take photos of the damage and send them to us by MMS at 9696 3399 or to by e-mail.

The MMS project started two weeks ago.

We hope to solve 50 per cent of the disputed cases using this new approach. Claimants can call our 24-hour hotline at 6788 6616.

Tan Kin Lian
Chief Executive Officer
NTUC Income

New Paper: Electrician bullied me

9 December 2005

The New Paper

I refer to the letter by Ms Lynn Aw entitled, "Electrician bullied me" (TNP, 08 Dec 2005).

Ms Aw shared her unfortunate experience with an electrician engaged by her to fix her faulty toilet light. She found the contractor through an advertisement in the newspaper.

NTUC Income provides an alternative way for home-owners to engage a contractor. They can call our 24-hour Home Service hotline, 6788 8878. We serve our policyholders and members of the public.

Under our Home Service portal, we register reliable contractors who can provide a wide range of 40 different types of services. The most popular services are plumbing, electrical, refrigeration, air-conditioning and tuition.

We check that the registered contactors are licensed and have undergone the required training for the service that they have provided. They are also required to commit to deliver deliver quality and professional service at a reasonable price, and to provide a 90-day warranty on the work.

If the customer finds the service to be unsatisfactory, they can lodge a complaint to us. We will investigate the complaint and find a solution. The complaint rate is low, representing less than 1% of the cases handled through our portal. Most of these complaint are resolved at the first level.

We handle an aveage of 150 calls a day for various servics through our portal. More information can be found at our website: or by calling 6788 8878.

Tan Soon Heng
General Manager
NTUC Income

Thursday, December 08, 2005

Q&A: Financial Planning for the Young

Question: Should young adults think about financial planning, when their earning is still low?

Yes. Each person should save at least 10% of their earnings. This is very important, as jobs are uncertain. They may also need their saving to meet an unexpected payment, including a large medical bill, or when they lose their job.

Question: How should they invest their saving?

They should invest in a flexible saving plan that can give an attractive rate of return over several years. An investment-linked plan from NTUC Income is probably the best. It is more appropriate than a bank account or a traditional life insurance plan.

Question: Does this plan have high charges?

Most investment-linked plans have high charges. But you can choose a plan that invest 100% of your monthly savings immediately, and incur low charges.

Question: Does this plan provide insurance protection?

It is better for you to buy a decreasing term assurance. It provides high coverage at a low premium that remains fixed during the term.

Q&A: How to select an investment fund

Question: There are many funds in the market. What are the main categories of funds?

You can choose an equity fund, a bond fund or a balanced fund, which invest in both asset types.

Over the past 10 years, a global equity fund earn an average of 10% per annum. The bond fund earn an average of 5% per annum. These averages are also reflective of the returns over a longer period.

Question: Is it risky to invest in equities?

Equities have higher risk than bonds. But the risk can be reduced through diversification. You should invest in a fund that invest in many equities. If any investment turns bad, the impact on the fund is small, and can be offset by the good investments.

If you invest for the long term, you are also able to diversify through the years. Your fund may perform well in some years and poorly in other years. But, over a long period, it is likely to give you a fairly attractive return.

Question: Is there a guarantee on my capital?

If you wish to have a guarantee, you should invest in government bonds that has the highest rating. However, the return is quite low at around 3% p.a. for 5 years.

It is better to invest in an large, well diversified fund that can give a better return, with minimal risk, over a longer period.

Question: Am I committed to invest for a fixed number of years?

You have the flexibility to choose the right time to realise your investments. If you choose a good time, you can turn risk to your advantage and realise a better return than average.

You are also allowed to realise your investment, if you need cash for other purpose without suffering any penalty (except for the termination charge in some case). You get the net asset value fo the fund.

Question: Do I have to incur high charges?

You have to check the initial, annual and termination charges on the fund. Some fund have low charges, and give a better return to the investor.

No claim discount for health insurance


I hope one day NTUC will also offer NCD for all its health products (there
is one in the industry that offers up to 30% NCD at this moment), which will
reward those people that maintain their good health. This is for sharing



We now offer 10% discount under Incomeshield if there is no claim for 3 years. We hope to be able to maintain this discount in the future, provided that our claim experience remain favourable.

I want you to know why the scale of NCD for motor insurance is different from health insurance.

In motor insurance, we have a claim rate of 20%. In Incomeshield, the claim rate is about 5%.

Due to the difference in claim rate, the NCD has to be reflected differently. Generally, if the claim rate is higher, it is possible to justify a higher rate of NCD to different between the good risk and the poor risk.

Positive feedback from our policyholder



We am very fortunate and privilege to know you. You have been providing an excellent and effective services over almost a decade. You understand your products and can communicate effectively. This had helped me to make my choice as I compare with your competition.

NTUC Income's vehicle insurance differential itself from the competition with NCD waiver for car insurance as an example.

I learned from this experience that the upper management in NTUC Income are extremely active and effective to resolve matters.. and it is a rare find.

I must also add that your customer service folks are also great in processing my car insurance renewal with Income, ahead of the usual due date to accommodate for my absence in Singapore in Dec, as I had mentioned in my earlier email.

Congratulation on your success and attainment of LIFE MEMBERSHIP for MDRT. May I you have an enjoyable congress in San Diego. If you got time, visit the Sea World and Wild Animal Park...

Wednesday, December 07, 2005

Tips for motorists

Tips for motorists

1. Motor insurance.

Shop around for your insurance. You can save up to
$200 a year, if you buy from the right place.

Call 6477 7722 for a quote. We insure about 40% of all vehicles,
due to our competitive rates and good service.

2. Accident

Use your mobilephone or camera to take photos of the
damages. It helps to identify the party at fault and prevent
the other party from inflating the damages.

Send your vehicle to an assessment center (Idac)
immediately. Let your insurer handle the repair. You
enjoy expert and hassle free service.

Call 6788 6616 for assistance (if you are insured
with NTUC Incoem).

3. No Claim Discount

If the damages are slight, make a private settlement, i.e.
pay cash for the damage. You can protect your discount
and enjoy savings over the next few years.

If you are not at fault, your insurer will help you to make
the claim against the other party and allow you to keep
the discount.

Website: Know Your Insurance

This website aims to:

- educate people about investment and insurance
- help them to make the right choice
- offers a discount when they decide to buy direct.

Try it:


Monday, December 05, 2005

Educational Talks

NTUC Income organises educational talks about insurance and investments.

We aim to educate consumers, so that they can make the right choice.

The talks are free, but you have to register your attendance at our website: or call 6877 3366.

You will see a list of talks scheduled for the next few weeks, ie title of talk, date, time, venue.

An attractive offer will be given at each educational talk. You can benefit by attending. Several of the talks are given by our chief executive officer or senior managers.

Compliment on good service

MESSAGE FROM a policyholder

Hi Mr. Tan Kin Lian (CEO of NTUC),

I have read the numerous response/letters in the ST Forum coming from NTUC. It is rare that a CEO of an organization respond to public queries. You have always make it a point to ensure that the public queries are answered.

Below is a chain of e-mail that reflects how quick and responsive your folks reply to a customer request, even though the customer (me) has indicated that 15th Dec is still alright.

It is something that you should know, that the good effort of your folks is being

If they went out of the normal procedure to assist the customer, I hope that they are not being reprimanded.

The intent of this letter is a feedback to you form a satisfied customer and a way that the NTUC staff be recognized for the good service.

The feedback phone call which normally comes few days after the service request has been made, showed the effort an organization is willing to put in, to improve its service.

Thank you for having such a team of people. The time taken to write this letter is deserving. I do hope to hear from your good self, so I know that the letter has reached you.

Offer of refund to annuitants

5 December 2005

Forum Page
Straits Times

I wish to respond to two recent stories in the Straits Times about the buyback offer offered by NTUC Income to 12,000 purchasers who bought their annuities prior to 2002 (? November and 3 December).

Both stories indicate that the refund offer is not attractive as the deal that they are getting now. This is correct.

The interest rate of 4.5 percent that is used to compute the refund is based on the actual yield earned by our investments during the past 10 years. This is lower than the guaranteed return of 5 per cent that was used to compute the annuity payments.

A small number from this group of annuitants were unhappy that they did not get any bonus for the past three years. We decided to make this refund offer, so that they can find a better way to invest their money.

Less than 10 people took up the offer of the refund. The majority decide to stay with their current annuity plan. For others who need a longer time to decide, our offer is still available for them for a few more weeks.

We sent an explanatory note to our 28,000 annuitants to explain our practice in declaring bonus. This supplements the communication that was sent in past years.

During the past two weeks, we also held two dialogue sessions that were attended by 600 people. The sessions went on well. Several annuitants were interested to top up their annuity.

NTUC Income is a cooperative society. We collect the annuity money and invest them into an annuity fund. We invest the fund prudently to earn an attractive long term return. We use the surplus of the annuity fund to declare bonuses to our annuitants. We exercise fairness in declaring the bonus to the different series of annuitants who have bought their annuities on different guaranteed terms.

We will continue to hold dialogue sessions in the future. We invite the public to attend these sessions and learn more about the principle of pooling is applied to help annuitants to manage their risks. We want to educate retirees about the advantages of investing in annuities.

Tan Kin Lian
Chief Executive Officer
NTUC Income

Reply to Chia Yoong Song on Incomeshield M

4 December 2005

Forum Page
Straits Times

I refer to the article "Host of errors in policy documents Incomeshield Plans MA, MB" by Chia Yoong Song (Straits Times, 3 December).

Mr Chia insured his wife under our Incomeshield Plan A. He and his two children were insured under Medishield Plus, which was recently converted to our Incomeshield Plan MA.

When we selected his wife's record to print the renewal notice in November, we accidentally linked it to Mr Chia's policy number under the Medishield Plus. This resulted in a printing error and caused the duplicated printing. When we spotted the error, we sent a new set of renewal notice fo his wife, to supercede the renewal notice.

We apologise for the error and inconvenience caused to Mr Chia. This error has now been rectified.

On a positive note, we now have a large base of 800,000 policyholders under our Incomeshield plan. With the economy of scale, we will be able to improve our insurance plans over time. Our aim is to provide adequate coverage for a lifetime and keep the premium at an affordable cost for our policyholders.

Tan Kin Lian
Chief Executive Officer
NTUC Income

Policyholder have second thoughts about going to distributor workshop


Dear Tan,

Your blog is extremely educational. I discovered it by accident following a search for your full name.

Like many people, I did not know earlier that there can be a significant difference between a distributor's cost of repair versus your authorised workshop.

After reading your blog, I have now become aware that it can make sense to get value for money by repairing at normal workshop, especially if the distributor is also sub-contracting work out.

I have reconsider my plan to go to my distributor workshop for the spraying. I will go to a normal workshop.

Thanks for every thing. Most importantly, the education that you have provided to the general public. I know I can trust your views.

Financial Planning: Tips for the Young

1. Save up to 15% of your monthly income. You may need you savings for an emergency or when you lose your job. Invest the savings in a flexible insurance plan that gives an attractive return.

2. Buy a low cost insurance plan that offers up to $100,000 in coverage against death, accident and hospital expenses for only $100 a year. Accidents can happen and you should be protected.

3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: or attend an educational talk (call: 6877 3366).


Visit this website: to participate in this contest and win prizes of $5,000.Eligible only for people between 20 to 30 years old. (Note: this will only be available from 15 Dec 2005).

Financial Planning: Tips for Young Parents

1. Save up to $200 monthly for your child. Invest the savings in a flexible insurance plan that gives an attractive return. The savings can be used for your tertiary education or give your child a head start in life.

2. Choose a plan that gives you an attractive return and invest 100% of your savings from the first month. Protect your savings with a decreasing term assurance that charges a very low premium, and allow more of your savings to accumulate.

3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: or attend an educational talk (call: 6877 3366).


Visit this website: to participate in this contest and win prizes of $5,000. Eligible only for people expecting a child or with a child less than 2 years old. (Note: this will only be available from 15 Dec 2005).

My personal views on the Melvyn Tan's eposide

Melvyn Tan is a world renowned pianist. He is a Singaprean.

When Melvyn was young, he went overseas to study. He did not return to perform his national service. His parents paid a bond of $30,000. It was a large sum of money at that time.

Many many years later, Melvyn Tan achieved world fame. He agreed to return to Singapore to perform at the Esplanade, Theatre by the Bay.

He voluntarily attended court to face the charge of failing to do his national service. He was fined $3,000.

Some Singaporeans were still not happy. They wrote strong letters to the newspapers. There was an uproar.

Finally, Melvyn Tan decided to cancel his performance at the Esplanade.

I like to ask the following questions:

- what have we achieved as a result of this uproar?
- how may times should a person be penalised for an offence?
- was the penalty of $30,000 on the bond sufficient?
- can we be a more forgiving people?
- do we want Melvyn to stay away from Singapore for a lifetime?

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