Wednesday, May 07, 2008

Fair distribution of bonus

Dear Mr. Tan,
If NTUC allows some policyholders to stay on the "old bonus structure", can NTUC punish these policyholders by giving a low rate of annual bonus in the future?

REPLY
The actuary and board of directors are required to act fairly in the distribution of the bonus among different groups of policyholders. If they act in a malicious manner, they can be subject to law suits and be personally liable.
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5 comments:

Anonymous said...

but the directors could be covered under some kinds of "Director Insurance"... lawsuits will not harm them...

Mr. Tan, do know if the NTUC Income directors are protected under such insurances??

http://en.wikipedia.org/wiki/Directors_and_officers_liability_insurance

May 07, 2008 11:59 AM
Tan Kin Lian said...

The directors and officers insurance does not cover wrongful actions deliberately taken by the insured persons.

May 07, 2008 12:08 PM
Anonymous said...

But whose interest do you think the directors are going to protect and surely you have to prove that they are acting in a malicious manner.

May 07, 2008 12:17 PM
Anonymous said...

yes, i think it is arduous to prove whether the directors are deliberate or not... it would probably take a long drawn court case to prove it...

May 07, 2008 3:12 PM
Anonymous said...

Hi Mr.Tan,

I remembered vividly that in 2003 and 2004,NTUC Insurance also cut our bonus....Why??

May 07, 2008 5:47 PM

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