Good news: Lower cost for health and motor

In the budget statement, the Minister of Finance announced that insurance companies can recover the GST on payments for repairs for passenger cars and health care bills.

This will mean that the cost of health and motor insurance will reduced by 3% to 4%.

This request for recovery of GST was submitted by NTUC Income. Anyway, all policyholders will benefit from this change in GST, regardless of who they insure with.

NTUC Income has already reduced our motor premiums by 5% from 1 January 2006. For health insurance, we will not increase the premium for 2006 and 2007, in spite of rising bills.

The saving in cost will help us to delay any future increase in premium for a longer period.

Top up rider for Incomeshield

NTUC Income has announced our top-up rider for Incomeshield. It has been generally well received. Many policyholders welcome this rider.

A few members of the public have raised these questions:

1. Is NTUC Income contradicting itself by first denouncing as-charged plans and subsequently introducing it?

Reply: We recognise the concern of some policyholders that the current limits under Incomeshield are inadquate for the major illness. The top up rider will cover the more expensive treatments. We do not cover "as charged" as there are some controls against inflated bills.

2. Definition of "emergency"

REPLY: An "emergency" is a situation where it is not possible for the policyholder to contact us to get prior approval.

3. Whether its practical to wait for prior approval being being admitted to hospital.

Reply: In most cases, the policyholder can get prior approval for the major illness that are likely to exceed the limits under the basic plan. It is a good idea to have a second opinion before committing to a major treatment. Our doctor can provide the second opinion.

4. Can NTUC Income spell out the conditions more transparently? If not, I do not trust the conditions.

Reply: We have spelled out the principles quite transparently. In the actual implementation, we have to be practical and flexible. We are a cooperative, and will do our best for our policyholders.

Unlike other insurers, we do not aim to make a lot of profit from medical insurance. It is better for consumers to insure with us, as we aim to keep the cost affordable for them.

Parallel imports - pay less for your new car

NTUC Income is working with parallel importers to offer popular models of cars at a significant discount from the normal dealer prices. NTUC Income will provide the warranty for 3 years.

Tentatively, the savings can be 5% to 10%. More details will be announced later in the educational website:

www.KnowYourInsurance.com.sg

Combined funds earned 8.2% in 2005

Dear Policyholder,

Investment Linked Funds

Thank you for investing in our investment linked funds. I have good news for you again.

Our investment funds continued to perform well in 2005. The average weighted return was 6.8%, after deduction of fees. Total fund under management has grown to more than $5,000 million.

Our combined funds performed better. The average weighted return was 8.2%. It has also outperformed its benchmark over the past 3 years.

Our funds performed well, due to the expertise of our fund managers and our commitment to bring you best value.

In a recent survey, 88% of our policyholders who invested in the combined fund are happy with the returns. More than 50% are interested to increase their investment.

To find out more about our funds, I invite you to my investment seminars held once every two weeks. You can visit our website www.income.coop or call 6877 3366.

Tan Kin Lian
Chief Executive Officer

Get a better return for your baby bonus?

The parent is allowed to contribute up to $6,000 in a child development account (ie baby bonus). The governemnt matches with $6,000.

The total of $12,000 has to be invested with POSB which pays interest at 0.275% a year. Unused money in the account will be transferred to edusave when the child enters primary school. The investment in POSB is for 6 years.

Capital sum $12,000
Interest for 6 years at 0.275% p.a $199
Interest for 6 years at 2.5% p.a $1,916 (10 times more)!
Interest for 6 years at 5.5% p.a. $4,546 (not guaranteed, 22 times more!)

The difference is still sizeable.

We will find a way to convince the government to allow the money to be invested in our balanced fund to earn a higher return.

What is Islamic insurance?

The Muslim community prefer insurance that are based on takaful principles, such as:

- transparency in transactions
- fair dealings, meaning mutual benefit
- cooperation for a common good to assist those in need

Under these principles, the policyholders are fairly treated and receive a fair return on their savings. The insurance provider can also get a fair profit from operating their insurance business.

As a cooperative society, NTUC Income has been operating on principles that are similar to Islamic principles.

Some Muslim scholars even hold the view that takaful should be operated as a cooperative or mutual insurance.

Our Amanah fund ($300 million now, to be increased to $1 billion) is popular with both Muslims and non-Muslims.

Enjoy benefit as a "preferred policyholder"

NTUC Income is looking for a better way to serve our policyholders. We plan to offer special loan terms to a "preferred policyholder":

[] Lower interest rate
[] Pre-approval of loan
[] Hassle free application
[] Longer repayment period
[] Higher loan amount

The loan could be for:

[] loan for marriage
[] to buy a car or motor cycle
[] to buy a home
[] for education
[] other purpose

To quality as a "preferred policyholder", the policyholder must be insured for at least 2 years and have total regular saving of more than $5,000.

We will also extend this status to a policyholder whose parent has at least $20,000 in cash value with us.

We want to make it a benefit for a young policyholder to be a "preferred policyholder".

Earn on your investment immediately!

If you buy a regular premium ILP (investment linked plan), you are likely to pay 150% of your annual premium as distribution cost.

If you invest $300 a month, the distribution cost will take away $5,400 from your savings. It goes to pay the agent's commission. This is the money that should be earning an attractive return for you instead.

If you buy a ILP from NTUC Income, 100% of your savings is invested immediately. You can get a much higher return on the maturity date!

Wow! It makes more sense to invest with NTUC Income.

Unbelievable? Go to www.askdrmoney.com.

If you have recently bought an expensive ILP, you can still make a switch now to NTUC Income. We can help you to reduce your cost and start making an invsetment gain now.

Call 6788 1111