Saturday, June 29, 2013

Integrity of agents and insurance companies

Dear Mr Tan,
I am reading your blog . I think you are a person with intergrity.
I supposed it is not the agent who want to behave wrongly. Is the way the insurance company teach their agent in selling to the market.
They use strategy and  incentive to push the agent to sell insurance to their client. Some old agent have to make a living thus they have to sell to fulfill the contract maintenance.
Newspaper awards are publicized by the insurer. This create the impression that agents are well to do. This create a lot of future problems as agents only focus on the first year commission used in the measurement. There are a lot of angry clients in the market.
The people who train the agent give biased comparison and teach the agent wrongly. They increase the agent's target.  Some old agents suffer and have to sell thing that don’t want.
Some insurers measure by life cases and force the agents to sell life insurance only. They internally throw challenge to the agent and force the agent to sell these biased product.
The agents are misled the insurer that they are building a franchise. The franchise cannot be sold, so the agents have to work like to hell.
We should stop pushing the blame to the agent. The insurer play a big part and is the party that  give the information , instruction, strategy and compensation plan. The agent has to follow.
Can we look at a bigger picture and talk about the insurer as they are the root of the problem rather on the agent. 

Recently, the commission has been cut. Newer agents have problem to enter the market and pass the examination. In the future, we will be left with old agents and brokers. I supposed more problem will occur.
Agents have to lead a poor lifestyle and need to tune to the timetable of the client every day. In the long run, they are promised nothing by the insurer - no retirement plan and regulatory changes. The problem is faced by older agents who have to take more examinations. 

We have to look into the welfare of the agents.  They are not protected by any party and cannot turn to the Ministry of Manpower if they have any problem.
What you have described applies to half of the agents, who are forced by circumstances or ignorance to sell products that are bad for customers.

But, after some time, these agents become aware. Some continue to sell the bad products to earn the good income or even to become the trainers and to recruit other people. Their integrity becomes questionable.

Other agents decide to leave the industry or opt to see the good products that are fair to customers. These agents have the integrity and interest of their customers. There are many of them.

The insurance companies should review their operation and offer products that are fair to customers. If they design bad products, their integrity is questionable. . 

Thursday, June 27, 2013

Sell essential items at controlled prices

22 June 2013

Editor, Forum Page
Straits Times

The recent scramble for the N95 masks and the steep
increase in price reveals the need for the Government to 
be prepared for future emergencies.

I suggest a procedure be in place to provide essential 
items at controlled prices during an emergency. It may be
the N95 mask today, but it could be other items in the

The steps could include:
  • The Government sources for the supplies in bulk at
    discounted prices
  • Offers these items at controlled prices through the
    appointed retail chains
  • Appoint a logistic company to handle the logistics of
    distribution and accounting.
It is better to be prepared to deal with future emergencies.

If funds have to be provided to the citizens, and more funds
for the poor, it can be credited to their bank account. It is better
for the government to register the bank account of
each citizen that can be used for these money credits.

Tan Kin Lian

9A Cactus Crescent
Singapore 573970
Mobile: 81685845

Wednesday, June 26, 2013

Can I claim for sudden loss of hearing under an accident policy?

Dear Mr. Tan, 
Lately, I am suffering from "Sudden Hearing Loss" and I was told by my specialist that there is 1/3 of the chance that the situation will not be recovered. Now, my left ear can barely hear - and there is an ongoing buzzing sound there. 
Can I make a claim under my QBE accidental plan - which stated 25% of the sum assure for one ear hearing loss? I am not sure whether this is conside
r accident in the insurance term, but certainly it is an accident for me .... just come in sudden and when I am working in the office. 
An accident policy usually defines an accident as being "unexpected, forceful, external" and usually excludes impairment due to natural causes. 
From your description, your loss of hearing is likely to be caused by natural causes and not by accident. This claim is not likely to succeed. 
If you want me to read the policy wordings, you have to use my consultancy service. Register at

Cars damaged by fallen tress

Richard Goh asked:
Yesterday, a few cars were damaged by fallen trees. Under such circumstances, if the  cars were parked in designated car park lots, can the owners claim from their insurances or the car park management, like URA or HDB or Town Councils. Your advice to all will be appreciated. 

 If you want to claim against the car park management, you have to prove that they were negligent. They can easily point out that the trees fell not because of their negligence, but by "an act of God". The claim is not likely to succeed.
The owner can claim for the damage to the cars under their own motor insurance policy.

How is progress towards the National Authentication Framework?

22 June 2013 

Editor, Forum Page
Straits Times

According to the website of the Infocomm Development Authority, the 
National Authentication Framework (NAF) seeks to provide a secure and trusted 
enabling infrastructure for delivery of online services by the public and private 

It will allow consumers to enjoy the convenience of using a single 
authentication device to access multiple online services.
The NAF was targeted to be ready by 2015. How is the progress toward 
achieving this goal?

Instead of using a single device, I now carry three separate devices issued by 
my bank for my personal and corporate accounts. The bank insisted on issuing 
separate devices to me, even though I am the same person who has the 
signing authority.

The bank has also changed their devices a few times.  Its latest devices 
for their personal and corporate accounts have many functions and are quite 
complicated to use.

I am also appalled at the heavy cost of issuing so many tokens, including 
replacements. This must ultimately be borne by consumers.

I understand that my bank has no plans to allow its device to be used its customers 
for authentication to other online services, This is against the goal of the 
I am aware that online banking may require another level of security to prevent 
hacking, but this could be done using some other means, instead of 
building it into an authentication device. 

May I seek the views of the Monetary Authority of Singapore on this matter? Are
they encouraging the banks to adopt the framework or to go their own way?

Tan Kin Lian

Difficulty in submitting e-invoice

21 June 2013

Editor, Forum Page
Straits Times

I thank the Accountant General's office and the Inland Revenue Authority of
Singapore for giving a prompt reply to my issue about the difficulty in 
submitting an e-invoice (Password for e-invoice system a necessary 

They have also contacted me directly to discuss the underlying issues
involved in the government processes. I thank them for their pro-active and
helpful approach.

As an active user of the Internet, I have created hundreds of passwords for
various websites, and in most cases, it has been an easy process. 

I hope that our government agencies find the right approach, to avoid wasting much 
time from the public and their employees providing support to the public.

I also support the online submission of invoices, and will be suggesting to 
these agencies on how the processes can be simplified to provide
the right level of security and convenience. 

We need to adopt a practical approach and recognize that there are vendors 
who transact with the government infrequently, and should not be required to spend so much 
time to go through a big learning curse to submit an invoice.

Tan Kin Lian

Opportunity for long term investor

Dear Mr Tan,
With regards to the recent market turmoil, the market has reacted strongly to the easing of QE by 2014 and possible interest rates hike thereafter, but seems to have forgotten that this easing shows the FED's confident in the recovery of the US economy.

When the selling is done, people may realized that they have over-reacted and bargain hunting may kick in.

For now, the market will continue its free fall due to the outflow of institutional funds to the States and the herd selling mentality by the retail investors.

Yes. For the long term investor, the selling gives a good buying opportunity, But the selling may last a few months.

Sunday, June 23, 2013

Supplementary Retirement Scheme benefits those above 47 years

This book explains the impact of the Supplementary Retirement Scheme on local employees and foreigners and on workers at different ages and tax brackets. 

The SRS is likely to be beneficial for tax payers contributing at an older age, after age 47 years.

Allow submission using fill-able PDF forms

I sent my proposal to IRAS to allow tax payers to submit their tax using a fill-able PDF form. 

It is easier for the tax payer to complete this form offline and submit it. The portal can extract the data from the form and send it to the backend system of IRAS for validation, acceptance and processing.

The offline PDF form will be especially helpful for individuals who have rental or other sources of income to complete, or for filing corporate tax accounts. 

I will be discussing this suggestion further with IRAS.

Here is my proposal

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