Saturday, November 12, 2005

If NTUC Income is not a cooperative, will it behave differently?

A visitor sent the following questions to me, about cooperatives in Singapore. Here are the questions and my reply.


Visited your blog earlier and indeed the commentaries there have been very informative. I’m not sure it is appropriate to ask you to comment on co-operatives in Singapore (NTUC Income, I believe, is the largest). But I would be grateful if you could share your enlightened views on

A) The general status of cooperatives in Singapore:

Reply: A few cooperatives have large operations and are doing well in Singapore.

For example, NTUC Fairprice runs a large and successful chain of supermarkets. They commend a large market share and are able to bring the prices down for consumers.

NTUC Income runs a large insurance operation and serves 2 million people. With our large market share, we are able to provide insurance coverage at low and affordable premium.

B) Would NTUC Income be significantly different if it were not constituted as a cooperative?

Reply: Yes, NTUC Income will be significantly different, if we were not constituted as a cooperative.

We would be charging higher premiums, to increase profit for shareholders. We would also find reasons to challenge claims and avoid paying them, also to increase profits. These are the reasons why I do not want NTUC Income to be profit driven.

C) How would you see cooperatives heading in the future (such as more cooperatives competing against each other)?

Reply: I wish to see more cooperatives making a big impact in the future. I hope that they will form a larger market share than today.

If more cooperatives are formed, there is the risk that they might compete against each other. This does not really matter.

In practice, they are likely to target different segments of members, so the risk of competition and conflict is small. Even if there is competition, the conflict should be minimal, as all cooperatives follow the same cooperative principles

Wednesday, November 09, 2005

A human voice answer your call

9 November 2005

Forum Page
Straits Times

I refer to the article "Readers air grouses with banks" (ST, 8 November 2005). Several of your readers expressed their unhappiness with automated telephone answering services from banks.

I wish to share our experience in operating our call center for the past 20 years.

NTUC Income is a large insurance cooperative serving 1.8 million policyholders. We handle an average of 300,000 inbound and outbound calls each month. Our call center operate 24 hour a day, seven days a week.

Over the years, we took a conscious decision not to place an answering system between our policyholders and our call center officers. We allow the policyholders to reach our officers directly and be served immediately, with minimal hassle. Callers are greeted warmly with a human voice instead of a recorded message.

Our policyholders can make enquiries or handle transactions through our call center. We have recently introduced separate hotline numbers so that our policyholders can be answered immediately in the language of their choice, namely English, Mandarin and Malay.

We are able to provide to achieve a high level of productivity of our call center officers through a good employee training and retention program. We introduced an escalation system that allows difficult issues to be escalated to the supervisors and experts. This reduce the stress on our call center officers and create a more conducive working environment. Our turnover rate is about half of the average for the call center industry.

We are able to provide friendly service at an economical cost, despite the higher wage level in Singapore. Our call centre operation is entirely based in Singapore. We believe that our policyholders will be better served by call center officers with local knowledge.

We strive for excellence in customer service and delight our customers with fast, effective and reliable service. We will be happy to share the experience of our call center with other business organisations and help to build a high standard of service quality in Singapore.

Tan Kin Lian
Chief Executive Officer
NTUC Income

Sunday, November 06, 2005

Fixed the price of land for the integrated resort

I agree with the decision of the government to fix the price of land for the integrated resort.

Here are my reasons:

- the government is in a better position to determine what is the fair market value for the land.

- it avoids excessive speculation on the price of land

- the choice of the winner will be based on the design concept and other factors.

I hope that this principle will apply to other areas of pricing, including:

- certificate (COE) for ownership of vehicles

- land for public and private housing

Four decades ago, the government fixed the price of HDB flats and shops. This allowed the services to be provided at a low cost and keep the cost of living low. This was a period when the Singapore economy grew well.

When the government decided to let the market forces determine the prices, it caused the prices to escalate (due mainly to excessive speculation). This has resulted in a high cost of living in Singapore.

We can move back to the good old days where the prices are determined by the government (with access to professional valuers). This approach can allow the prices that reflect the market, but avoid excessive speculation.

Tan Kin Lian
(in my personal capacity)

MHS (managed care) policyholder ask for clarification


Thank you very much, Mr Tan, for your time and advice. Really appreciate the fact that as CEO, you take the trouble to address my concerns.



I'm however confused about the recent policy changes with regards to Medishield and my current status. I was not under medishield after I retired because I continued with MHS.

1) Is the MHS considered an enhanced plan or a Medisave-approved private integrated plan? If so, am I automatically also covered under medishield, in addition to my MHS? Does that mean, I now have a basic medishield plus MHS?

Reply: You only have MHS. You have the option from NTUC Income to move to Incomeshield at any time in the future. You are NOT covered under Medishield - as you have been excluded from it. With MHS, you already get more coverage than Medishield, so there is no need for you to buy Medishield and waste money.

2) If I am now only covered under MHS, is it advisible to opt in for the basic medishield ( I understand that the govt is encouraging us to do so). Or am I by default opted in already after the new policy change?!

Reply: Yes, if you wish to give up MHS (due to its high cost), you can opt for Incomeshield (and not basic Medishield). Incomeshield covers everything that Medishield covers and more than that. What the government has done is to require the insurer to "re-insure a portion of their shield back to CPF". This is a matter to be sorted out between us and CPF and should not concern you.

2) Yes, I agree with you that the premium is rather high for MHS for a retiree like myself. For this reason, can't I use Mesisave to pay for thepremium? With the liberaliation and privatisation of Medishield plans, it is a step backward (and frustrating) to realise that I cannot utilise my own funds to protect myself during the time I need it most.

Reply: You can use Medisave to pay for Incomeshield, but not MHS (from 2007). This is the decision of the government. They have their reason. Let us accept it.

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