NTUC Income - implementing the two objectives

Dear Mr. Tan,

Thank you very much for your effort in organising and representing us in this collective issue. I support your decision. However, would there be any safeguards to ensure that NTUC Income will implement the two objectives.

On another point, as a result of this collective action initiated by yourself, you have a strong following of supporters. May I request that all of us supporters stay together with Mr Tan as our spokesman as an informal group. Perhaps we can be known as the 'NTUC Income Watch Group".

Leon Khor

REPLY
Mr. Lim Boon Heng told me that this Social Enterprise Development Committee will continue to ensure that Income follows it social purpose. I will use this channel to present views on the future implementation of these two objectives.

I intend to write a paper on the use of asset shares as a measure of equitable bonus distribution. This will ensure that the bonus and cash values follow the asset shares. I hope that some actuaries within this group can help me to write this paper.

According to this concept, the insurance company has to calculate the asset share for each policy based on the premiums paid, investment income earned and deducting the expenses and mortality charges. The actual experience is used in the calculation. The insurance company can use the asset share to calculate the annual and terminal bonus payable on the policy. It should pay cash values that are quite close to the asset share of the policy, less a certain margin for its profits.

The chairman of Income has said at the annual general meeting that the board will look after the best interest of the policyholders. We can let him have a benchmark on what is the best interest of policyholders, in terms of sustainable bonuses and cash values.