Saturday, September 23, 2006

My future plans

I will leave the services of NTUC Income on 1 April 2007. By then, I shall be 59 years old.

I intend to work actively for another 11 years, until I am 70. My key priorities during the first two years will be:

- build the technology and business platform for the "insurance company of the future"

- provide management consultancy on business strategy, marketing, human resource, customer service and operational excellence

- give lectures, talks and training

I also intend to set up a company to promote Logic9, BEST simulation game and language training. This will allow the colleagues to own and build the business.

More details will be provided over the next few weeks.

I ignore gossip

Terence: On a personal note, there are gossips about you over the years. How would you handle these kinds of stuff?

TKL: I ignore gossips.

Terence: Good for you that you ignore them as gossips comes from both internal and
external. I think the best is hear from the horse's mouth. I shall not quote those gossips to you - since you are ignoring them.

A sudden announcement

My earlier plan was to announce my departure from NTUC Income on 5 October (Income Day). This will allow some time for some of the details to be finalised.

The Straits Times heard about about the "rumour". They insisted on writing the story. I requested them to wait for a few days for the media release.

When I learned that the Straits Times insist on carrying the story, I had to get my chairman to agree to issue the media release earlier.

I had also to inform my colleagues about the announcement, so that they do not hear about it from the papers. This has to be done at midnight.

I am very sad at the inconsiderate behaviour of the Straits Times. They are willing to advance their own agenda, without regard to the harmful impact on other people.

In my dealing with other papers, including the foreign media, I generally find that they are more considerate.

Please don't go


I read from the newspapers that you are leaving Income?

This company was single-handedly run by you since our days in the early 1980s. I feel it a pity that you are leaving the company.

Just read your blog - especially on that Stanley Jermiah's leaving the company.

Now that he has left Income, don't you think that you ought to stay behind and
steer the company? Any impact on the policyholders' confidence if there is no
main driver at the driver's seat?



Dear Terence,

The next CEO will be a younger, capable person who can take NTUC Income towards the next important stage in the career.

I am confident that NTUC Income will continue to do well in the future. There are many dedicated, capable, colleagues in NTUC Income who will continue to look after the best interest of our policyholders.

We have appointed another capable person to head the life insurance department. He is a qualified actuary with many years of senior management experience. The media release on his appointment was sent out a few days earlier. It is now posted in my blog.

Tan Kin Lian

Media Release: Chief Executive Officer

NTUC Income wishes to announce that its CEO, Mr Tan Kin Lian, will be leaving the Cooperative on 1 April 2007 to pursue other interests. The Board of NTUC Income accepts his departure with regret.

Mr Tan, who joined NTUC Income on 1 April 1977 as its General Manager, would have completed 30 years of service on 1 April 2007.

During the past 30 years, Mr Tan has built a strong financial foundation for the Cooperative. From an asset base of $40 million in 1977, the Cooperative now has total assets exceeding $17 billion and annual premiums exceeding $2 billion. NTUC Income, rated "AA" by Standard & Poor's, is the highest rated insurance company from Asia.

The Board will be commencing a search for a new chief executive.

Mr Tan said, "It has been a great privilege for me to work in NTUC Income for the past 30 years. Time has passed so quickly. I enjoy working with many wonderful colleagues who shared the same passion and dedication to build a strong organisation that is dedicated to serve the interest of our 1,800,000 policyholders. I am confident that under a new leadership, my colleagues will be able to take NTUC Income through the next important stage of its development. I wish them well."

Mr Ng Kee Choe, Chairman of NTUC Income said, "Kin Lian has led the Cooperative well and built it to what it is today, the largest composite insurance company in Singapore. Members of the Board and I wish him well and every success in his future endeavours."

Karen Ng
Head (Media Relations)
NTUC Income
DID: 6877 3492
Hp : 9619 0912

Pursue other interest

I will be leaving NTUC Income from 1 April 2007 to pursue other interest. By that time, I will have completed 30 years of service.

This will allow the board to find a new chief executive officer to take NTUC Income through the next important stage of its development.

I am confident that NTUC Income will continue to do well in the future. I have many dedicated, capable, younger colleagues in NTUC Income who will continue to look after the best interest of our policyholders.

I shall be pursuing other interest.

If you have any questions, send them to I shall be answering these questions in my blog. Get your friends to read the blog.

Friday, September 22, 2006

Faster settlement of Incomeshield claims

In June 2006, there was a backlog of Incomeshield claims. It took an average of 28 days to clear the claims in Income (compared to a service target of 7 days).

The delay were due to two factors:

- increase in volume of claims
- migrating to a new computer system

The following measures were implemented and they have contributed in speeding up the processing of the claims. We carried a once-off exercies in August to clear off the outstanding claims held back from earlier months.

The average number of days has reduced as follows:

July : 24 days
August : 20 days
September: 12 days

We expect to reach our service target of 7 days in October.

William Fong
Head, Group & Health Dept

Report from my daughter Jamie Tan in Bangkok

22 September 2006

For anyone residing in Thailand on 20 September 2006, it started like any normal day in Bangkok but ended in a state of confusion.

The first realization that something was amiss was when the tanks started to roll into central Bangkok at about 9.30pm, into the area 30 minutes from where I worked and lived in Bangkok.

At that time, I was having dinner at one of the major shopping centers and everything
was normal, no commotions or indications that something was not right.

When I had returned to the hotel and turned on the television to the CNN, there were news flashes on rumors of a military coup in Thailand.

There were also confirmed reports of tanks moving in the streets towards the Prime Minister's Office and that a couple of hours earlier, army chief general had been sacked from the office. It wasn't long before CNN was cut off and all the Thai television channel services were terminated.

When the channel services were resumed, all Thai television channels were broadcasting the same video repeats of their beloved king and the only source of information ironically, was from CNN, BBC and Channel Newasia.

By this time, my hotel phone started ringing non stop with concerned Thai colleagues giving me the latest updates as the situation unfolded.

According to my sources, some people had expected this revolt and also provided theories on 3rd party involvement. I also started receiving short messages from colleagues outside of Bangkok that had learnt about this from the TV and were telling be to be safe.

News spread and we tried to get in touch with as many colleagues in Bangkok to inform them on the situation and get them into safety lest violence broke out. It wasn't long before the telecommunication networks got unstable and I was not able to make or receive calls on my phone.

Outside my window, I noticed that the streets had started to clear (also because it was getting late into the night) and there were more than the usual number of police cars on the streets.

Glued to the TV, I learnt that PM Thaksin had declared a state of emergency and the last news that I had received before I went to bed was that PM Thaksin, in USA, was starting to regain control of the situation to put a stop to the military coup.

The next morning, I started receiving phone calls at 6am. There was a complete turn of events as compared to the night before. Overnight, the military had gotten complete control of the country (without firing a single shot) and that Thailand had become a military state. The key persons from the overthrown government had either fled the country or were in custody. To regain control of the situation, the interim
government declared a public holiday.

I spent the day in the apartment with my colleagues working and by evening, boredom got the best of me and we went for a walk on the streets. For the normal Thai people, life was almost back to normal. A poll held in the evening confirmed that over 85% of the people in Thailand supported the military coup.

After work, the next day, the team had a late dinner and later took a drive towards the PM office. We saw many tanks on the way with soldiers, situated at strategic places, guarding. The soldiers and military police were very friendly and allowed us to take pictures with them and the tank. The tanks had also lots of decorations of flowers given by the Thai people which reflected the support that the military was given for their actions. Also, on the same day, the king of Thailand issued his
support for the interim government.

Two days after the incident, things have gotten back to 90% normal. People going back to work, leading their normal lives because no matter what happens, everyone has to work to survive. There is still tension in the air, expecting for the overthrown government to reorganize and launch retaliation. However, for now, with PM Thaksin in England with his family, having a "holiday", the general view of the people here is that things can only get better from here on.


Our motor rates are up to 30% lower than some competitors

Dear Mr Tan,

In your blog, you claimed that Income's motor insurance is 30% cheaper than competitors, I beg to differ.

When my company's van insurance was due, I renewed with Income.

I received a flyer from one insurance broker (with my company's name and van number on the flyer) and the amount of premium. It was much cheaper than NTUC. I called my Income agent and told him about what the other insurance company's charged.

About 2 weeks later, I received a letter from Income with a cheque inside the letter. Income gave me a discount on the insurance premium and the cheque was for the 'refund' of the discounted amount.

Therefore till now I do not believe that your premium is cheaper than competitors. Fthe next renewal, I will shop around for better rate.



Dear ET

Our market survey shows that our premium is "up to 30%" cheaper than our major competitors. It does depend on the model, and the market situation (as some of our competitors adjust their premium rates to match our rates).

Please refer to this page for the comparison:

Tan Kin Lian
Chief Executive Officer

Reply: Policyhlder ask for projection

Forum Page
Straits Times

We refer to the article posted by Mr Poon Foo Keong entitled "Insurance policyholders have right to know whether insurers meet projections" (St Times, 21 Sept).

Each year, we also notify our policyholder about the bonus declared under their policy.

If there is a reduction in the bonus rates, we send a statement to notify the policyholder of the revised projected bonus, so that their expectation will be corrected. This is accompanied by a detailed explanation.

We receive requests from some policyholders asking for a detailed projection, for each future year, of the projected bonus under their policy. These requests are made at other times. They are often followed by a request for a detailed explanation. It can take a lot of time for our customer service officer to answer the enquiry.

To cover our cost of providing the projection and explanation, we impose a modest fee of $20. However, if the request is done through the insurance adviser, we will usually waive the charge.

In Mr Poon's case, we did waive the charge. We did provide an explanation of our practice to Mr Poon at the time of his request.

Peh Chee Keong
Head, Life Insurance

Be considerate

I wish to share this story of a third party claimant who has behaved inconsiderately.

The claimant approached me for help. I asked my manager to assist him. The claimant did not get a return call within 4 days. Instead of calling my manager to find out, the claimant send a impolite e-mail to me, and copy to the Prime Minister of Singapore.

Here is his e-mail and my reply.


Dear Mr. Tan Kin Lian.

Thank you for sending Mr. Goh to assist me on my third party insurance claim.

Mr. Goh called me on 22 August at 2205 hrs. He told me that he will get back to me in four working days. Now I am still waiting for his call. I wonder how he calculate his four working days?

Can you please tell me how this will enhance your glory or the glory of NTUC income?



Dear PN,

Normally, Mr Goh is quite prompt. I think that he may have some difficulty in contacting you. I shall remind him.

Tan Kin Lian

Thursday, September 21, 2006

A wise move - get advice early


Hi Mr Tan,

I am 22 year old. I have 1 protection and 1 Ideal plan. Is this sufficient for me?

I want an insurance that has a saving plan. Currently, I am serving national service



Dear LJL

I will arrange for a consultant to advice you.

Observing the coup in Bangkok

My daughter Jamie is in Bangkok during the past few days. She has first hand experience of the coup. She reported that things are quite normal. I have asked her to send her observations for me to post into this blog.

Request for advice on AIA policy


Hi, Tan.

Saw your blog. Just thinking you could be the right person to give me a piece of advice on insurance and saving for future.

I bought an AIA Investment Link Plan that has life coverage of $100k, critical illness of $50k and medical plan.

The annual premium is $1,800 and I took up AIA managed fund. I am not a person who can take risk and feel uncomfortable seeing unpredictable return in future.

From your point of view, is investment link plan a good choice of saving + insurance with tight budget? Do I have to pay until the policy matured? How could future economic performance affect my insurance plan? Is it adviseable to top-up or ad-hoc now since the unit price is still low?

I have consulted 2 AIA insurance agents but their only give minimum words on this. I sincerely hope that you can help me on this decision making as on whether I should keep the 3-year-old policy or surrender it for a traditional insurance.


Dear R

Please read this FAQ on the Ideal plan (which is similar to the investment plan that you have bought from AIA):

FAQ on Ideal Plan

Here is another FAQ that explains about investment risk (it applies to the Ideal plan as well):

FAQ on Investment Risk

Generally, if you are investing for the long term, an investment fund is suitable. You should choose a large, well diversified fund to minimise the risk of poor performance of certain investments. If you invest for 10 years or longer, you will average out the good and bad years and get an attractive return.

Looking at your AIA policy, you should consider two points:

- what is the annual charge on the fund?
- what is the upfront charge to pay commission to the agent?

These two charges can take away a large part of your return. It can amount to several tens of thousand of dollars. There is an example in my FAQ.

I will ask my product specialist to contact you, in case you need further asssitance.

Tan Kin Lian

Wednesday, September 20, 2006

More customers now visit the business center to buy insurance


1. A customer telephoned the business centre to enquire on our Combined Funds. Our consultant arranged to meet him to present the benefits of investing in our Combined Funds. The consultant showed him the 5 slides from our chief executive officer. They highlight the low charges and better returns. The customer was convinced to place $240,000.

2. A customer visited the business center to collect the Logic9 gift. The consultant presented the FAQ on the Ideal and I-gift plans. The customer came back the following day to take up 4 Ideal policies for her four kids (saving of $180 per month for each policy) and the i-Gift of $30,000 for herself. She is using the monthly payout of the i-Gift to pay for her 4 Ideal policies.

Tuesday, September 19, 2006

Financial Advice for Young Parents

Financial advice for young parents
by Mr Tan Kin Lian
Chief Executive Officer, NTUC Income

Many people do not plan well for their future financial needs.

They spend most of their regular income on meeting their immediate needs. They spend too much on luxuries, such as fashion, entertainment and holidays. They make the wrong decisions and pay more than necessary. They rely on credit and pay a high interest rate.

They make the wrong investments and get a poor rate of return.

It is important for young parents to have a proper financial plan, so that they can provide financial security for their family, save for their future retirement needs and for the education of their children.

They need insurance to protect against the risks of premature deaths, accidents or major illnesses. This can be purchased at a low premium.

Every working person should have a simple budget. It helps them to have financial discipline. Preferably, they should save 10 to 20 percent of the regular earnings. Saving is more important today, as jobs are less certain. We can draw down the savings during an emergency, to meet our cash flow needs, if we are out of work for a few months.

I advise most young parents to save and invest in a flexible investment plan. You should invest for the long term and aim for a higher rate of return. You should invest in a large, well-diversified fund, to reduce the risk of a few bad investments. By investing for many years, you can average the good and bad years and get a better return.

The Ideal Plan from NTUC Income has lower charges, compared to similar plans in the market. A higher proportion of the regular savings is invested during the initial years. It can amount to 12 months of additional savings and can contribute to a larger payout in the future.

You can invest your savings in the Combined Fund from NTUC Income. It has $3.7 billion of investments, is well-diversified and has low charges. It earned an average return of about 16 percent during the past three years (2003 to 2005). This is exceptional. Even if the return is at a more modest rate of say 6 percent, it can give a substantially higher return compared to other types of investments.

~ End ~

Monday, September 18, 2006

How accurate is the report on "net return on life policies"?


How accurate is the analysis in the Sunday Times on the 10 year net rates of return on life policies?

The net rates of return for NTUC Income is above average. But Income lag behind for-profit insurers - Asia Insurance, AIA and HSBC Insurance.

How did they do better, and pay shareholders more as well? Is it due to better investment returns?



I believe that the analysis is not accurate. Income earns a better return than AIA. I think that the unrealised gains in equities are not shown (and AIA invest in a low proportion of equities that do not produce this gain).

The figures for HSBC is not reliable. Their business is quite small. They show more than 20% gain in 1 year (probably on a very small fund). This distorts the computation of the "average".

Asia does quite well, but their fund is virtually stagnant. If they grow their business, their results will be closer to the other large insurers.

We will make a more detailed study and give a fuller report.

The report shows that the fund "earns". It does not show what the fund pays out to the policyholders on their maturity. The difference is the profit that is taken away to give to the shareholders.

When an AIA policy matures, they pay out 10% to 20% lower than the maturity of a similar policy with NTUC Income. This has been the case for the past many years.

Tan Kin Lian
CEO, NTUC Income

IMF / World Bank meetings

I attended a seminar on Saturday under the umbrella of the IMF/ World Bank. The security was tight. It was quite a hassle to get past the security.

I had to collect my badge at City Hall. I took a shuttle bus to Suntec City. It had to go through a big round to the back entrance of Suntec City. It took 15 minutes longer than usual. So, I missed the first 30 minutes of the seminar.

There must be over 10 concurrent seminars or meetings held at the convention center and the nearby hotels, including those held by the investment banks. Locating the right meeting place is also quite difficult. Fortunately, there are many guides around that can show the way.

I have since attended 4 seminars. The quality of the seminars is excellent. The speakers are very good, very knowledgeable. The questions and answers were handled very well. There were active engagement.

Overall, it is a wonderful experience to participate in the IMF and World Bank seminars.

Nice Blog, but it has spelling and grammar mistakes


Dear Mr Tan Kin Lian,

Congratulations on your blog! I chanced upon it today and it has been a useful and riveting read.

I am already an NTUC Income policyholder, and am impressed with the level of effort that you put into your blog and NTUC Income. Your boldness in starting a blog has surely paid rich dividends for NTUC Income ... personally, I think it is great that a CEO of a company is also the "chief marketing officer" for the company.

One suggestion I have is perhaps, for you to let one of your colleagues look through the grammar of your replies before they are posted. While I understand that you are a busy man and content is more important than form, having one of your colleagues look through the grammer of your replies will put an even greater sheen on the professional image of NTUC Income.

Keep up the good work, Mr CEO!



Dear Shawn,

Thank you.
I am aware about the grammar and spelling mistakes.
I think that it is okay, as it shows the "informal nature" of the blog.

When I come across the mistakes, I do edit them.
But, sometimes, it is too much trouble.

FAQ: Motor Insurance

1. Why must I insure my vehicle?

The law requires all motor vehicles to be insured against liability to third parties for death or bodily injuries.

Most owners also want to insure for the damage caused by accidents, vandalism, fire or flood. The insurance policy will cover the repair of their vehicle. It will pay the market value of the vehicle at the time of loss if cannot be repaired economically or if the vehicle was stolen.

With a motor insurance policy, you pay a small annual premium and protect yourself against the loss arising from those contingencies

2. What choices do I have?

Most owners prefer to take a comprehensive policy to cover liability to third parties and repair damage caused by accidents, vandalism, fire or flood, and loss of their vehicles from theft.

The comprehensive policy provided by NTUC Income is called the "quality plan".

3. Why should I choose NTUC Income?

NTUC Income is a cooperative society. We are not profit-driven, unlike the commercial insurance companies.

We charge a fair premium to cover our cost of claims and expenses and a modest margin. We keep a tight control against inflated claims, so that the premium can be kept low. In most cases, our premium rates are up to 30% lower than our competitors.

Other insurers charge a higher premium, because they pay more to their agents and want to make a bigger profit margin.

NTUC Income is the largest insurer of motor vehicles in Singapore. We insure 200,000 vehicles, representing about 32% of all vehicles in Singapore. We achieve a large market share due to our competitive rates and quality of service.

4. How is your standard of service?

We are prompt, fair and transparent in our dealings with our customers.

We conduct a customer survey for every repair arranged at our quality workship. Our customers consistently give us a high satisfaction rating above 96%.

5. Do you take good care of me, if I need your help?

We have a 24 hour hotline (Tel: 6788 6616) to provide immediate assistance to you in the following:

- location of the nearest Idac center (to report an accident)
- get accesss to road side assistance
- advice on how to submit your claim
- towing service if your car is immobilised after an accident.

You can also call or visit our claims service center. The colleagues are specialised in handling claim issues.

You will get a FAQ from the Idac center or our claim service center. It tells you about how your claim is being handled.

6. Can I pay my premium in monthly instalments?

You can pay your premium in 12 monthly instalments by GIRO. This is free of interest.

You need only to pay the instalment 1 month in advance. At the start, you will pay 2 monthlh instalments. After than, we will collect the monthly instalments every month through GIRO.

7. Can I also pay my road tax in monthly instalments

You can apply for an advance to pay your road tax. We will collect it from you in 12 monthly instalments with a flat interest as follows :

- for customers with loyalty discount, flat rate of 3% per annum.
- for other customers, flat rate of 6% per annum.

Note : a customer enjoys a loyalty discount by insuring with us for at least 3 years.

8. Does your quality workshop provide a good standard of repair?

We select our quality workshops based on their ability to meet the following standard:

- abide by a code of professional conduct
- able to meet performance and quality standard
- meet our post-repair inspection checks
- provide 6 months guarantee on their repairs

For most repairs, our quality workshops are able to meet the same standard as the distributor workshops. Some distributors sub-contract most of the repair work to outside workshops anyway.

9. Can I go to a distributor workshop for repair to my vehicle ?

We will agree for the proprietary repairs (which require the use of specialised tools and skills) to be carried out at the distributor's workshop.

We prefer the general repairs to be carried out by our authorised workshops. If you wish to have it repaired at your distributor workshop, we will pay you a cash payment and you can negotiate for the repair at your distributor's workshop.

10. Will my car warranty be void if I repair at your authorised workshop ?

We will provide FREE protection against loss of car manufacturer's warranty, if the repair is done at our quality workshop.

If the distributor voids the warranty due to our repair, we will take over the warranty for the remaining period under the same terms and conditions provided for in the purchase of your car.

11. Can I switch my insurance to NTUC Income after the first year?

You have the choice to switch your insurance to us at any time.

You can enjoy a saving of up to 30%, compared to the rate charged by other insurers.

If you switch to us, we will make it hassle-free for you. We can help you cancel your existing policy and get the refund of the unused part of the premium from your existing policy. We will issue a replacement policy to take over the remaining period of insurance. It will be delivered to your home or office.

Call 98INCOME (9846 2663)

12. What are the special features provided by NTUC Income?

- FREE protection against loss of manufacturer's warranty.
- FREE NCD protection for policyholders who enjoy 50% NCD for 5 years.
- Replacement with a new car if your new car is stolen or totally damaged.
- Extension to cover you against third party liabilities while driving a rental car overseas.
- Extension to cover renting out of your car during public holidays.
- Cover of terrorism.
- No additional unnamed drivers excess.
- No elderly driver excess.
- No additional loading of your premium after a bad accident*.

* terms and conditions apply.

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