Saturday, July 29, 2006

Agent ask about our commission rates


Mr Tan. I am an agent of .... I read your blog about migrating to NTUC Income. I understand that your commission rate is lower than my company. Why should I move over?


Our commision rate is about 30% to 50% lower than other insurance companies. This allows us to lower the premium to our policyholders and give them a better return on their savings.

Our agents find it easier to sell our products, as customers approach them directly.

We also generate leads from existing customers to give to our agents. This helps our agents to reduce the time taken to close a sale. Some of the sales can be done through the telephone, without a visit.

Most of our agents are able to close 2 or 3 times the volume of sales. They can earn a higher income.

They can also face their customers in the future and say, "I offered you a good product that gives a better return to you".

Several agents who have migrated to NTUC Income are now our champion producers. Previously, when the worked for their previous company, they could hardly meet the sales quota.

Kind remark from a visitor

I receive this kind remark from a visitor who read by blog.

Mr Tan,

I am surprised that, as you CEO, you are willing to attend to questions from your customers.

I read your blog about the customer who insist that you attend to his matter, even though the matter can be handled by your colleague.

By being accessible, are you taking the risk that many customers will want to bypass your colleagues and want you to attend to their matter personally? How can you find the time? Is it stressful?

I hope that you can sort out the good from the bad, and still be accessible to your customers to give their suggestions and views.

Living policy by limited premiums

Some customers like to take a Whole Life policy that covers 30 dread diseases, and they want to pay their premium for a certain number of years only, ie not for life.

They ask NTUC Income to offer this plan.

We will be introducing this plan in about 3 months time. I have to alert them that the premium will be much higher than a whole life policy.

For example, if you insure $50,000 with premiums payable for life, you may have to pay a premium of about $1,000 (actually, it depends on your age).

If you take a 20 year payment policy, you may have to pay 2 times of the premium, or more. This is due to the shorter premium period.

Alternatively, you can take a smaller policy to fit your budget.

Unemployed workers refuse to work in retail industry

A report in the Straits Times said that there are 70,000 unemployed workers in Singapore, but they do not want to work in the retail industry. The employers have to look for foreign workers.


I think that they find it difficult to cope with the difficult Singaporean customers. Some customers are quite demanding. They have high and unreasonable expectation of service and are not forgiving of mistakes. It is quite stressful to deal with them.

Many years ago, NTUC Income had difficult to recruit people to work in the frontline to serve customers - i.e. at our call center, service center or branches.

We manage to solve this problem, and are now able to get people to work at these places and to stay there. We still have difficulty, but not as much as other organisations.

What is our strategy? If you are in Human Resource management and are interested to know, send an e-mail to me at

A second chance to develop your career in insurance sales

If you have a licence as an insurance agent, and you find it difficult to meet the sales quote of your company, maybe you should migrate to NTUC Income. We give you a second chance to develop your career in insurance sales.

Here is how we are different:

* we generate leads from our 500,000 direct customers
* we offer value products, ie lower premium and better return
* many products can be sold over the telephone

If you are interested to try this "marketing of the future", you can call 6877 3366.

Replies to comments posted in my blog

A few visitors posted comments that disagree with me. Some of the comments are quite personal and uncalled for. I will leave them in my blog for other people to make their own judgement.

If anyone wish to ask a specific question that is important to you, please send an e-mail to me at I will answer them myself or get my colleague to reply to you.

Some of the people who posted their comments obviously work for my competitors. They are agents of other insurance companies or financial advisers marketing unit trusts. They argue that their products are better. Maybe, they are right. I will let the customers make their own judgement.

Some unit trusts are available at no front end charge. But, you have to be careful about their annual fee. It may be 1.5% or 2%. They may also have trailer charge. So, you just have to make sure that you have the correct comparison.

You can also visit Dr Money's website, at He makes a comparison of the charges of unit trusts and insurance funds.

All the best.

Friday, July 28, 2006

Policyholder invest $50,000 on his birthday

My insurance adviser told this story.


I called my policyholder this morning at 10 am to wish Happy Birthday. I was surprised. My policyholder told me that my CEO is earlier than me. He SMS the policyholder at 8 am to wish him Happy Birthday.

Because of my CEO's message, my policyholder wanted to invest an additional $50000 in our Combined Growth Fund.

Why do your colleagues block e-mails to the CEO?

A policyholder asked why my colleagues block e-mails to the CEO. Here is my reply:


You ask why emails to me are blocked by my colleagues. Normally, my colleagues attend to the routine matters, and will refer to me only those matters that need my attention.

Even if your e-mail does reach me, I am not able to answer specifically the questions that you have raised, and will need to refer them to my colleagues who handles them anyway.

You were unhappy about the delay in responding to your request for upgrading.

During this period, my colleagues are overwhelmed by 60,000 requests for upgrading into the Enhanced Incomeshield plan. This has caused a lot of backlog with its own set of problems. As they are highly stressed, there is some delay and drop in standard of service. Please accept our apology.

Monday, July 24, 2006

Customer prefer to insure with NTUC Income


Hi Mr Tan,

I am a policyholder of Income's Living Policy.

Recently, I found out that there is a kind of insurance policy that provides the same whole life coverage as Living Policy, but which requires policholders to pay the premium for a limited period only (e.g. 20 years).

Your staff has told me that Income has a similar policy known as Protection AD. However, Protection AD DOES NOT PAY the Sum Assured upon diagnosis of the 30 Dreaded Diseases.

I wonder if Income is planning to launch such a whole-life-but-term-payment insurance policy?


We intend to launch a similar product in three months time. It will give better value to our customers, compared to similar products in the market. I will ask my colleague to send you some detail in 1 month's time, when our premium rates and yield to maturity are available.


Dear Mr Tan,

Thank you very much for your prompt reply! I am delighted to hear this piece of good news!

I had actually bought Asia LifeSecure, but I cancelled it during the free-look period; I was hoping that Income would launch a similar product but with a more affordable premium.

Do not allow the adviser to churn your CPF investment

Recently, there is some articles in the newspaper about "churning" of investments using CPF savings. Let me explain what the issue is.

Churning takes place when there is unnecessary buying and selling of investment in order to generate income for the insurance adviser.

A customer has to incur a front-end spread (ie the difference between the bid and offer price), when investing in this product. Most companies charge a spread of 5%. NTUC Incomes charges a lower spread of 3.5%.

If the investment is sold within a short time, there is insufficient time to realise a good return to recover the front end cost. We advise CPF funds to be invested for the long term and not for short term speculation.

NTUC Income is against churning, as it is at the expense of policyholders. We pay a lower rate of commission to our insurance advisers. They do not have the incentive to churn. Our supervisor call the policyholder at the time of purchase to ensure that they properly understand their investment and the features of the product.

We have the lowest rate of early surrenders in the industry. If a customer wishes to surrender his investment, we explain the disadvantages of early surrender. We also provide them with other options such as switching from one fund to another so that they avoid high front end cost.

Radio Ad on Flexi-Cash

Our insurance consultant in the business center obtained a lead from Hotline from a customer who heard our radio ad. The customer was impressed with the ad on Flexicash.

She signed up $15,000 and mentioned that "your CEO says that we can earn 3% or more , I take his word"

Dance Appreciation Series at the Esplanade

The Singapore Dance Theatre is partnering with The Esplanade to introduce several interesting dance items at a special price of only $10 per person (plus $1 SISTIC fee).

Normally, a dance performance cost between $50 to $100 in Singapore. We are offering a special price to encourage more people to appreciate and enjoy this art form. The dance items are choreographed by world famous and local choreographers

Do not miss this wonderful opportunity. Book your ticket early.

Date: 14 August, 15 August, 6 September 2006
Time: 4 p.m (1 hour performance)
Venue: Esplanade Concert Hall

Tickets: Esplanade Box Office & SISTIC's outlets. SISTIC Hotline: 63485555

ETUDES An Introduction to Class
Excepts from THE NUTCRACKER by Jeffrey Tan
DYING SWAN by Thierry Malandain
BOLERO by Thierry Malandain

Sunday, July 23, 2006

Advertisement: Soar in your Insurance Sales

If you already have an life insurance licence, and find it difficult to meet the sales quota, you are working for the wrong company.

Come to NTUC Income. You can enjoy:

* products that are easy to sell
* better value for your customers, from a cooperative
* attractive rate of commission, payable upfront
* sales leads from our large customer base
* ease of marketing through product FAQ
* marketing through the telephone
* monthly advance to provide at least $2,500

Do not be stuck with the old way of marketing life insurance.
Move to the marketing of the future.

Call 6877 3366 or visit (available from 28 July)

New system for Incomeshield helps to clear the backlog

Here is a report from my head of Group & Health Department.

We have recently introduced a new computer system to handle the upgrade to Enhanced
Incomeshield. It works well and is able to clear many cases efficiently.

We have processed more than 20,000 cases (out of 60,000) that do not require underwriting. However, we continue to receive 10,000 new requests each week. We anticipate this will only start to slow down next month.

We expect to clear the backlog completely by Sep 2006. For new requests received at our, we send an email reply of acknowledgement to the sender on the same day.

AIA policyholders have to pay premium longer than projected earlier

The Straits Times reported that policyholders of AIA have to continue to pay more premium, i.e. longer duration of premium payment. This was due to poor investment returns.

As many as 120,000 policies are affected. These are the policyholders who bought the Financial Guardian, Choice Life and Prime Life.

Many years ago, when the advisers from NTUC Income approached me to make the same projections to the policyholders, I refused to do so. I think that it is too speculative.

But, the agents from AIA did roaring business by making this projection. Now their policyholders are disappointed and have to suffer in silence.

NTUC Income does not use marketing gimmicks to sell our products. We offer "honest" insurance products that are fair and good for our customers.

Flexi-Cash: it takes 12 days to recover the initial spread

A policyholder invested $200,000 in the FlexiCash and monitored the price movements. He found that it was still making a loss after a few days. He compared to a ban deposit that shows the interest accruing immediately.

Here is my explanation.


There is a spread of 0.1% when you make your investment. This is the difference between the offer and bid price of the unit. When you make an investment, you pay a spread of $200.

The bid price is expected to grow based on the yield of the money market rate fund. Based on the current rate, the yield should be 3%. It can go up and down according to the money market.

It will take about 12 days to earn enough to cover the spread. After that, you can earn more.

The advantage of Flexi-Cash is the higher interest rate and no lock-in period. The slight disadvantage, compared to a bank deposit, is the initial spread, which takes 12 days to recover.

During the promotion period, which spread is 0.1%. After the promotion, the spread will be increased to 0.25%. At that time, it will take about 30 days to earn enough to cover the spread.

I hope that this explanation is clear to you. I will put it in the FAQ so that this point is clearer.

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