In the budget statement, the Minister of Finance announced that insurance companies can recover the GST on payments for repairs for passenger cars and health care bills.
This will mean that the cost of health and motor insurance will reduced by 3% to 4%.
This request for recovery of GST was submitted by NTUC Income. Anyway, all policyholders will benefit from this change in GST, regardless of who they insure with.
NTUC Income has already reduced our motor premiums by 5% from 1 January 2006. For health insurance, we will not increase the premium for 2006 and 2007, in spite of rising bills.
The saving in cost will help us to delay any future increase in premium for a longer period.
Saturday, February 18, 2006
Friday, February 17, 2006
Top up rider for Incomeshield
NTUC Income has announced our top-up rider for Incomeshield. It has been generally well received. Many policyholders welcome this rider.
A few members of the public have raised these questions:
1. Is NTUC Income contradicting itself by first denouncing as-charged plans and subsequently introducing it?
Reply: We recognise the concern of some policyholders that the current limits under Incomeshield are inadquate for the major illness. The top up rider will cover the more expensive treatments. We do not cover "as charged" as there are some controls against inflated bills.
2. Definition of "emergency"
REPLY: An "emergency" is a situation where it is not possible for the policyholder to contact us to get prior approval.
3. Whether its practical to wait for prior approval being being admitted to hospital.
Reply: In most cases, the policyholder can get prior approval for the major illness that are likely to exceed the limits under the basic plan. It is a good idea to have a second opinion before committing to a major treatment. Our doctor can provide the second opinion.
4. Can NTUC Income spell out the conditions more transparently? If not, I do not trust the conditions.
Reply: We have spelled out the principles quite transparently. In the actual implementation, we have to be practical and flexible. We are a cooperative, and will do our best for our policyholders.
Unlike other insurers, we do not aim to make a lot of profit from medical insurance. It is better for consumers to insure with us, as we aim to keep the cost affordable for them.
A few members of the public have raised these questions:
1. Is NTUC Income contradicting itself by first denouncing as-charged plans and subsequently introducing it?
Reply: We recognise the concern of some policyholders that the current limits under Incomeshield are inadquate for the major illness. The top up rider will cover the more expensive treatments. We do not cover "as charged" as there are some controls against inflated bills.
2. Definition of "emergency"
REPLY: An "emergency" is a situation where it is not possible for the policyholder to contact us to get prior approval.
3. Whether its practical to wait for prior approval being being admitted to hospital.
Reply: In most cases, the policyholder can get prior approval for the major illness that are likely to exceed the limits under the basic plan. It is a good idea to have a second opinion before committing to a major treatment. Our doctor can provide the second opinion.
4. Can NTUC Income spell out the conditions more transparently? If not, I do not trust the conditions.
Reply: We have spelled out the principles quite transparently. In the actual implementation, we have to be practical and flexible. We are a cooperative, and will do our best for our policyholders.
Unlike other insurers, we do not aim to make a lot of profit from medical insurance. It is better for consumers to insure with us, as we aim to keep the cost affordable for them.
Thursday, February 16, 2006
Parallel imports - pay less for your new car
NTUC Income is working with parallel importers to offer popular models of cars at a significant discount from the normal dealer prices. NTUC Income will provide the warranty for 3 years.
Tentatively, the savings can be 5% to 10%. More details will be announced later in the educational website:
www.KnowYourInsurance.com.sg
Tentatively, the savings can be 5% to 10%. More details will be announced later in the educational website:
www.KnowYourInsurance.com.sg
Tuesday, February 14, 2006
Combined funds earned 8.2% in 2005
Dear Policyholder,
Investment Linked Funds
Thank you for investing in our investment linked funds. I have good news for you again.
Our investment funds continued to perform well in 2005. The average weighted return was 6.8%, after deduction of fees. Total fund under management has grown to more than $5,000 million.
Our combined funds performed better. The average weighted return was 8.2%. It has also outperformed its benchmark over the past 3 years.
Our funds performed well, due to the expertise of our fund managers and our commitment to bring you best value.
In a recent survey, 88% of our policyholders who invested in the combined fund are happy with the returns. More than 50% are interested to increase their investment.
To find out more about our funds, I invite you to my investment seminars held once every two weeks. You can visit our website www.income.coop or call 6877 3366.
Tan Kin Lian
Chief Executive Officer
Investment Linked Funds
Thank you for investing in our investment linked funds. I have good news for you again.
Our investment funds continued to perform well in 2005. The average weighted return was 6.8%, after deduction of fees. Total fund under management has grown to more than $5,000 million.
Our combined funds performed better. The average weighted return was 8.2%. It has also outperformed its benchmark over the past 3 years.
Our funds performed well, due to the expertise of our fund managers and our commitment to bring you best value.
In a recent survey, 88% of our policyholders who invested in the combined fund are happy with the returns. More than 50% are interested to increase their investment.
To find out more about our funds, I invite you to my investment seminars held once every two weeks. You can visit our website www.income.coop or call 6877 3366.
Tan Kin Lian
Chief Executive Officer
Get a better return for your baby bonus?
The parent is allowed to contribute up to $6,000 in a child development account (ie baby bonus). The governemnt matches with $6,000.
The total of $12,000 has to be invested with POSB which pays interest at 0.275% a year. Unused money in the account will be transferred to edusave when the child enters primary school. The investment in POSB is for 6 years.
Capital sum $12,000
Interest for 6 years at 0.275% p.a $199
Interest for 6 years at 2.5% p.a $1,916 (10 times more)!
Interest for 6 years at 5.5% p.a. $4,546 (not guaranteed, 22 times more!)
The difference is still sizeable.
We will find a way to convince the government to allow the money to be invested in our balanced fund to earn a higher return.
The total of $12,000 has to be invested with POSB which pays interest at 0.275% a year. Unused money in the account will be transferred to edusave when the child enters primary school. The investment in POSB is for 6 years.
Capital sum $12,000
Interest for 6 years at 0.275% p.a $199
Interest for 6 years at 2.5% p.a $1,916 (10 times more)!
Interest for 6 years at 5.5% p.a. $4,546 (not guaranteed, 22 times more!)
The difference is still sizeable.
We will find a way to convince the government to allow the money to be invested in our balanced fund to earn a higher return.
Monday, February 13, 2006
What is Islamic insurance?
The Muslim community prefer insurance that are based on takaful principles, such as:
- transparency in transactions
- fair dealings, meaning mutual benefit
- cooperation for a common good to assist those in need
Under these principles, the policyholders are fairly treated and receive a fair return on their savings. The insurance provider can also get a fair profit from operating their insurance business.
As a cooperative society, NTUC Income has been operating on principles that are similar to Islamic principles.
Some Muslim scholars even hold the view that takaful should be operated as a cooperative or mutual insurance.
Our Amanah fund ($300 million now, to be increased to $1 billion) is popular with both Muslims and non-Muslims.
- transparency in transactions
- fair dealings, meaning mutual benefit
- cooperation for a common good to assist those in need
Under these principles, the policyholders are fairly treated and receive a fair return on their savings. The insurance provider can also get a fair profit from operating their insurance business.
As a cooperative society, NTUC Income has been operating on principles that are similar to Islamic principles.
Some Muslim scholars even hold the view that takaful should be operated as a cooperative or mutual insurance.
Our Amanah fund ($300 million now, to be increased to $1 billion) is popular with both Muslims and non-Muslims.
Sunday, February 12, 2006
Enjoy benefit as a "preferred policyholder"
NTUC Income is looking for a better way to serve our policyholders. We plan to offer special loan terms to a "preferred policyholder":
[] Lower interest rate
[] Pre-approval of loan
[] Hassle free application
[] Longer repayment period
[] Higher loan amount
The loan could be for:
[] loan for marriage
[] to buy a car or motor cycle
[] to buy a home
[] for education
[] other purpose
To quality as a "preferred policyholder", the policyholder must be insured for at least 2 years and have total regular saving of more than $5,000.
We will also extend this status to a policyholder whose parent has at least $20,000 in cash value with us.
We want to make it a benefit for a young policyholder to be a "preferred policyholder".
[] Lower interest rate
[] Pre-approval of loan
[] Hassle free application
[] Longer repayment period
[] Higher loan amount
The loan could be for:
[] loan for marriage
[] to buy a car or motor cycle
[] to buy a home
[] for education
[] other purpose
To quality as a "preferred policyholder", the policyholder must be insured for at least 2 years and have total regular saving of more than $5,000.
We will also extend this status to a policyholder whose parent has at least $20,000 in cash value with us.
We want to make it a benefit for a young policyholder to be a "preferred policyholder".
Earn on your investment immediately!
If you buy a regular premium ILP (investment linked plan), you are likely to pay 150% of your annual premium as distribution cost.
If you invest $300 a month, the distribution cost will take away $5,400 from your savings. It goes to pay the agent's commission. This is the money that should be earning an attractive return for you instead.
If you buy a ILP from NTUC Income, 100% of your savings is invested immediately. You can get a much higher return on the maturity date!
Wow! It makes more sense to invest with NTUC Income.
Unbelievable? Go to www.askdrmoney.com.
If you have recently bought an expensive ILP, you can still make a switch now to NTUC Income. We can help you to reduce your cost and start making an invsetment gain now.
Call 6788 1111
If you invest $300 a month, the distribution cost will take away $5,400 from your savings. It goes to pay the agent's commission. This is the money that should be earning an attractive return for you instead.
If you buy a ILP from NTUC Income, 100% of your savings is invested immediately. You can get a much higher return on the maturity date!
Wow! It makes more sense to invest with NTUC Income.
Unbelievable? Go to www.askdrmoney.com.
If you have recently bought an expensive ILP, you can still make a switch now to NTUC Income. We can help you to reduce your cost and start making an invsetment gain now.
Call 6788 1111
Saturday, February 11, 2006
Visitors to my blog
My site meter shows an average of 67 people visit my blog every day, including weekends. Thank you for being one of them.
Tell you friends to visit my blog.
Tell you friends to visit my blog.
Friday, February 10, 2006
Offer better value to consumers
100 years ago, it was difficult to sell life insurance.
An insurance agent had to spend many months to learn about insurance and selling skills. A productive agent sold 20 policies in a year. It was hard work to convince people to buy life insurance.
The agent had to earn enough to make a living. So, commission had to be high, as much as 1 year of premium, to make it worth while for the agent.
The government gave tax relief to the policyholder. If the policyholder kept the policy for 10 years or longer, the saving in tax relief was more than the commission earned by the agent. The return to the policyhoder from life insurance was quite attractive, in spite of the high distribution cost.
About 20 years ago, the government in many countries removed the tax relief or made it worth much less.
Around that time, the life insurance funds were able to earn a high rate of investment return. If the policyholder kept the policy for a long period, the net return was still quite attractive, even after paying for the high distribution cost.
For example, if the insurance fund earned a net rate of 7% per annum, and the expenses effectively took away 2.5%, the net return to the policyholder was still quite attractive at 4.5%.
The scenario changes when investment return dropped. If the investment return was 4.5%, and 2.5% was deducted for expenses, the net return to the policyholder was only 2%. This would be unattractive for a 20 year investment.
Life insurance agents changed their selling pitch. They sold to customers about the importance of insurance. But the product is not really the right one, as it is too costly and give a poor return.
What is the solution?
Life insurance agents and companies have to change their approach.
They have to offer better value products to their customers. They have to reduce their distribution cost and other expenses, and distribute a larger portion of the investment return to their customers.
How can agents survive on lower commission? By finding new ways to increase the volume of sales, without having to work longer hours. In other words, by being more productive.
They should sell 50 to 100 policies a year, and not only 20 policies. The commission can be lower for each policy, but the income on the higher volume of sales will be higher.
Life insurance companies must also do their part by streamlining operations and reducing expenses.
By working together, agents and their companies can lower costs, increase returns and remain competitive in this new consumer-savvy environment.
NTUC Income is making the changes to provide better value to the customers. By adapting, we expect to prosper in the insurance industry of the 21st century.
An insurance agent had to spend many months to learn about insurance and selling skills. A productive agent sold 20 policies in a year. It was hard work to convince people to buy life insurance.
The agent had to earn enough to make a living. So, commission had to be high, as much as 1 year of premium, to make it worth while for the agent.
The government gave tax relief to the policyholder. If the policyholder kept the policy for 10 years or longer, the saving in tax relief was more than the commission earned by the agent. The return to the policyhoder from life insurance was quite attractive, in spite of the high distribution cost.
About 20 years ago, the government in many countries removed the tax relief or made it worth much less.
Around that time, the life insurance funds were able to earn a high rate of investment return. If the policyholder kept the policy for a long period, the net return was still quite attractive, even after paying for the high distribution cost.
For example, if the insurance fund earned a net rate of 7% per annum, and the expenses effectively took away 2.5%, the net return to the policyholder was still quite attractive at 4.5%.
The scenario changes when investment return dropped. If the investment return was 4.5%, and 2.5% was deducted for expenses, the net return to the policyholder was only 2%. This would be unattractive for a 20 year investment.
Life insurance agents changed their selling pitch. They sold to customers about the importance of insurance. But the product is not really the right one, as it is too costly and give a poor return.
What is the solution?
Life insurance agents and companies have to change their approach.
They have to offer better value products to their customers. They have to reduce their distribution cost and other expenses, and distribute a larger portion of the investment return to their customers.
How can agents survive on lower commission? By finding new ways to increase the volume of sales, without having to work longer hours. In other words, by being more productive.
They should sell 50 to 100 policies a year, and not only 20 policies. The commission can be lower for each policy, but the income on the higher volume of sales will be higher.
Life insurance companies must also do their part by streamlining operations and reducing expenses.
By working together, agents and their companies can lower costs, increase returns and remain competitive in this new consumer-savvy environment.
NTUC Income is making the changes to provide better value to the customers. By adapting, we expect to prosper in the insurance industry of the 21st century.
Wednesday, February 08, 2006
Give work to students from poor family
NTUC Income plans to give work to students who come from poor family. They will be recommended by the school.
We will pay them at $6 or $7 an hour. The work can be done using the personal computer in the school. The student can work for 2 hours each day.
We hope to benefit 500 students in a year.
If these students do not have useful work, they may idle and loiter. Giving them useful work can help their family to pay for their school expenses. It will give them something meaningful to work for.
We will pay them at $6 or $7 an hour. The work can be done using the personal computer in the school. The student can work for 2 hours each day.
We hope to benefit 500 students in a year.
If these students do not have useful work, they may idle and loiter. Giving them useful work can help their family to pay for their school expenses. It will give them something meaningful to work for.
Invest in a 10 year annuity and save tax
Here is an idea. An annuitant can invest in a 10 year annuity and save on tax.
Annuity is now exempt from tax. Here is an example of how it can be used for tax saving.
The annuitant invest $10,000 to receive an annuity certain of $1,232 per year for 10 years. This assumes that 4% interest is used in the computation.
The total payment for 10 years is $12,320. The actual interest earned is $2,320. If the annuitant pays income tax at 10%, the tax payable on the interest component should be $232. By investing in an annuity plan, the annuitant save $232 on the tax.
The tax saving add 0.4% to the yield. This is the same as investing in another product to earn 4.4%, pay income tax at 10% and get the same net return as the annuity.
Annuity is now exempt from tax. Here is an example of how it can be used for tax saving.
The annuitant invest $10,000 to receive an annuity certain of $1,232 per year for 10 years. This assumes that 4% interest is used in the computation.
The total payment for 10 years is $12,320. The actual interest earned is $2,320. If the annuitant pays income tax at 10%, the tax payable on the interest component should be $232. By investing in an annuity plan, the annuitant save $232 on the tax.
The tax saving add 0.4% to the yield. This is the same as investing in another product to earn 4.4%, pay income tax at 10% and get the same net return as the annuity.
Monday, February 06, 2006
Know Your Insurance - Topics
If you like to learn about any of the topics below, you can visit
www.KnowYourInsurance.com.sg
INSURANCE
Motor Insurance
iYoung
Investment Linked Plan
Personal Accident
Travel Insurance
Medical Insurance
Saving for Education
FAST (Financial Advice)
An insurance cooperative
Life Annuity
Home Insurance
GENERAL
Manage Your Money
Take a holiday in Sabah
Invest your CPF savings
Buying a new car
Estate Duty
www.KnowYourInsurance.com.sg
INSURANCE
Motor Insurance
iYoung
Investment Linked Plan
Personal Accident
Travel Insurance
Medical Insurance
Saving for Education
FAST (Financial Advice)
An insurance cooperative
Life Annuity
Home Insurance
GENERAL
Manage Your Money
Take a holiday in Sabah
Invest your CPF savings
Buying a new car
Estate Duty
Know Your Insurance website - Mandarin & Malay
NTUC Income is launching the Mandarin and Malays versions of the "Know Your Insurance" website.
We first launched the English version of this website on 21 December 2005. It received encouraging response. A total of 33,000 people have visited the website over the past five weeks, or an average of 1,000 visitors daily.
5,000 people have taken the test on the insurance topics and are eligible for a discount when they purchase NTUC Income's insurance products.
A recent survey of 200 visitors:
82 per cent find the website to be educational
94 per cent of the users will visit the website again
82 per cent will recommend their friends to visit the website
74 per cent will take advantage of the discounts to buy insurance
The top five popular topics are: Motor Insurance, Investment-Linked Plan, Life Annuity, Medical Insurance and iYoung.
We first launched the English version of this website on 21 December 2005. It received encouraging response. A total of 33,000 people have visited the website over the past five weeks, or an average of 1,000 visitors daily.
5,000 people have taken the test on the insurance topics and are eligible for a discount when they purchase NTUC Income's insurance products.
A recent survey of 200 visitors:
82 per cent find the website to be educational
94 per cent of the users will visit the website again
82 per cent will recommend their friends to visit the website
74 per cent will take advantage of the discounts to buy insurance
The top five popular topics are: Motor Insurance, Investment-Linked Plan, Life Annuity, Medical Insurance and iYoung.
Saturday, February 04, 2006
My wish for budget 2006 - SRS
If I were the Finance Minister, I would ... Review the Supplementary Retirement Scheme and make it more effective in helping people to make additional savings for retirement.
I will increase the amount of contribution to a flat 15% of annual income, or $16,000 whichever is higher.
For non-residents who do not contribute to CPF, I will allow an additional contribution of 20% of earnings, subject to a cap of $9,600 (being 20% on $4,000 X 12).
The other features of the SRS can remain the same.
I will increase the amount of contribution to a flat 15% of annual income, or $16,000 whichever is higher.
For non-residents who do not contribute to CPF, I will allow an additional contribution of 20% of earnings, subject to a cap of $9,600 (being 20% on $4,000 X 12).
The other features of the SRS can remain the same.
Annuity income is exempt from personal tax
If you buy an annuity, the income that you receive is fully exempt from personal tax.
Here is an example. Assume an annuitant invest $100,000 in an annuity and receive back a total of $150,000 during the lifetime. This comprise of a return of capital (ie $100,000) and the income earned on investing this sum, (ie $50,000).
The annuitant does not have to pay any personal tax on the full amount revieved as annuity.
If the annuitant had invested invested in other type of investment and earned an income of $50,000 over several years, this income will be taxed at the marginal rate. If this rate is an average of 10%, the tax payable is $5,000.
By investing in the life annuity, the annuitant enjoy this tax exemption and receives $5,000 more.
An annuity has a tax advantage. It is better to invest in an annuity, if the return given is competitive.
In the above example, if the total payout of $150,000 is received over 20 years, the annuity income for each year is $7,500. This represents an attractive return of 7.5% on the invested sum. However, this return comprise partly of the consumption of the capital and on the actual income earned.
NTUC Income offers an attractive return on our annuities. We now account for 60 percent of the market. The remaining 40% is shared by several life insurance companies.
Here is an example. Assume an annuitant invest $100,000 in an annuity and receive back a total of $150,000 during the lifetime. This comprise of a return of capital (ie $100,000) and the income earned on investing this sum, (ie $50,000).
The annuitant does not have to pay any personal tax on the full amount revieved as annuity.
If the annuitant had invested invested in other type of investment and earned an income of $50,000 over several years, this income will be taxed at the marginal rate. If this rate is an average of 10%, the tax payable is $5,000.
By investing in the life annuity, the annuitant enjoy this tax exemption and receives $5,000 more.
An annuity has a tax advantage. It is better to invest in an annuity, if the return given is competitive.
In the above example, if the total payout of $150,000 is received over 20 years, the annuity income for each year is $7,500. This represents an attractive return of 7.5% on the invested sum. However, this return comprise partly of the consumption of the capital and on the actual income earned.
NTUC Income offers an attractive return on our annuities. We now account for 60 percent of the market. The remaining 40% is shared by several life insurance companies.
Friday, February 03, 2006
Cancel your motor insurance and move to NTUC Income
NTUC Income charges a lower premium rate for motor insurance. The difference can be up to 25%.
If you have insured at a higher premium rate, you can cancel the existing policy, get the refund premium and move to NTUC Income now.
Your current insurer will normally charge 15% of the premium or $100 for administration charges for cancellation. The unused premium minus the cancellation charge is returned to the policyholder.
Here is an example.
Take the case of a policyholder who pays a premium of $1,200 and wish to cancel the policy after 6 months.
The refund premium is 1/2 of 85% of $1,200 = $510.
If our premium is $900 (ie 25% lower than $1,200), the policyholder pays only $450 for the 6 month of insurance with us.
He will benefit by cancelling the policy and moving to us now. The benefit is higher, if you cancel your policy within the first few months.
If you have insured at a higher premium rate, you can cancel the existing policy, get the refund premium and move to NTUC Income now.
Your current insurer will normally charge 15% of the premium or $100 for administration charges for cancellation. The unused premium minus the cancellation charge is returned to the policyholder.
Here is an example.
Take the case of a policyholder who pays a premium of $1,200 and wish to cancel the policy after 6 months.
The refund premium is 1/2 of 85% of $1,200 = $510.
If our premium is $900 (ie 25% lower than $1,200), the policyholder pays only $450 for the 6 month of insurance with us.
He will benefit by cancelling the policy and moving to us now. The benefit is higher, if you cancel your policy within the first few months.
Advice: How to restructure your life insurance
QUESTION
Dear Mr Tan
In today's global market condition and removal of the iron rice bowl, job security are now being a thing of the past. Many Singaporean whom have bought numerous
life insurance policies found that they are not able to keep up with the long term payment.
This has resulted in cancellation after emptying accumulated bonuses to pay their insurance premium. It is no longer attractive to make a long term commitment.
I am a victim of multinational company relocated from Singapore to New Delhi.
REPLY
Dear
I will get someone to assist you on restructuring your insurance plans, as follows:
- surrender for the cash value
- NTUC Income gives generous values compared to other insurance companies
- invest the cash value in our combined fund (for flexibility and attractive return)
- make flexible savings under our Ideal plan
- take a decreassing term assurance for your coverage (it cost you much less)
Dear Mr Tan
In today's global market condition and removal of the iron rice bowl, job security are now being a thing of the past. Many Singaporean whom have bought numerous
life insurance policies found that they are not able to keep up with the long term payment.
This has resulted in cancellation after emptying accumulated bonuses to pay their insurance premium. It is no longer attractive to make a long term commitment.
I am a victim of multinational company relocated from Singapore to New Delhi.
REPLY
Dear
I will get someone to assist you on restructuring your insurance plans, as follows:
- surrender for the cash value
- NTUC Income gives generous values compared to other insurance companies
- invest the cash value in our combined fund (for flexibility and attractive return)
- make flexible savings under our Ideal plan
- take a decreassing term assurance for your coverage (it cost you much less)
Thursday, February 02, 2006
Avoid Structured Deposit
QUESTION FROM A COLLEAGUE
In 2003, my father and I invested $5,000 in a 6-year capital guaranteed investment product called "Enrich Account".
It provides a 3.6% pay-out in the first year and subsequent pay-outs on the Bank's discretion. We received a payout of S$180 in 2003, S$90 in 2004 and no payout in 2005. The current value of the investment is S$4,300. We are tied up till 2009.
I suspect the poor performance is due to its bond investments which are affected by the rising interest rate environment. Although it is capital guaranteed, it ties up our money for 6 years and ultimately gives poor returns.
What is your advice?
LESSON:
This is a good example of structured deposits and the problems with them. I avoid them.
If you wish to invest in a structured product, you should understand how it works. You should also ask the Bank to disclose disclose the minimum and maximum return and the actual returns realised - for each of the structured products which have matured.
In 2003, my father and I invested $5,000 in a 6-year capital guaranteed investment product called "Enrich Account".
It provides a 3.6% pay-out in the first year and subsequent pay-outs on the Bank's discretion. We received a payout of S$180 in 2003, S$90 in 2004 and no payout in 2005. The current value of the investment is S$4,300. We are tied up till 2009.
I suspect the poor performance is due to its bond investments which are affected by the rising interest rate environment. Although it is capital guaranteed, it ties up our money for 6 years and ultimately gives poor returns.
What is your advice?
LESSON:
This is a good example of structured deposits and the problems with them. I avoid them.
If you wish to invest in a structured product, you should understand how it works. You should also ask the Bank to disclose disclose the minimum and maximum return and the actual returns realised - for each of the structured products which have matured.
Wednesday, February 01, 2006
A new way to sell insurance
INSURANCE AGENTS
Tired of prospecting?
Tired of making cold calls?
Tired of running around to make presentations?
Tired of long working hours?
We are looking for qualified agents to join our expanding team of full-time Insurance Consultants
• Fixed salary of $1,500 to $2,500 with performance-based incentives
• Comprehensive training and career progression
• Office-based environment
• Attractive staff benefits and balanced work-life
• 5-day work week
• Get a sign-on bonus of $1,000 (subject to conditions)
Interested candidates, please apply via: www.income.coop/career
Tired of prospecting?
Tired of making cold calls?
Tired of running around to make presentations?
Tired of long working hours?
We are looking for qualified agents to join our expanding team of full-time Insurance Consultants
• Fixed salary of $1,500 to $2,500 with performance-based incentives
• Comprehensive training and career progression
• Office-based environment
• Attractive staff benefits and balanced work-life
• 5-day work week
• Get a sign-on bonus of $1,000 (subject to conditions)
Interested candidates, please apply via: www.income.coop/career
Tuesday, January 31, 2006
Regular investments using CPF
QUESTION:
Dear Mr. Tan,
Thank you for regular updates in your blog. It is interesting, relevant and useful.
Could you discuss a little on regular savings plan for your investment funds products, using CPF OA and SA?
I am sure other readers would be keen to know if there is such a plan as it potentially helps to beat the CPF returns (if using CPF funds for investment). If there is no RSP arrangements, would NTUC be looking into this?
REPLY
Dear
NTUC Income has a regular savings plan. It is called the Ideal plan. It has to be paid by cash.
Alternatively, you can invest your CPF savings (ordinary or special account) as a single premium under our Flexilink plan. You can top up your savings at any time with a "recurring" single premium, provided that the top up is at least $1,000.
The advantage of a single premium plan is that the charge is very low.
Dear Mr. Tan,
Thank you for regular updates in your blog. It is interesting, relevant and useful.
Could you discuss a little on regular savings plan for your investment funds products, using CPF OA and SA?
I am sure other readers would be keen to know if there is such a plan as it potentially helps to beat the CPF returns (if using CPF funds for investment). If there is no RSP arrangements, would NTUC be looking into this?
REPLY
Dear
NTUC Income has a regular savings plan. It is called the Ideal plan. It has to be paid by cash.
Alternatively, you can invest your CPF savings (ordinary or special account) as a single premium under our Flexilink plan. You can top up your savings at any time with a "recurring" single premium, provided that the top up is at least $1,000.
The advantage of a single premium plan is that the charge is very low.
Top Up Rider for Incomeshield
QUESTION:
Dear Mr Tan,
I am a fan of your blog. My family are gratefully insured under Incomeshield for many years. Your recent discussion on affordable medical insurance prompts me to seek your advice.
In about a week's time, my father is likely to undergo an angioplasty op by a referred doctor in SGH's National Heart Centre, likely under "minimum" B1 ward. Based on our calculation, we may be able to claim less than half of the hospital bill from Incomeshield. My dad is under Plan B.
This prompts me to think of getting my family a second medical plan (a backup) that may cover the higher cost should special circumstances that need private or Class B1 govt ward arise in the future.
However, we do not wish to give up on Incomeshield which we have great faith in in taking care of us in decades to come. And I know private medical plans are very
expensive (as you have mentioned) and also have to be paid by cash.
I would like to seek your advice on whether NTUC Income (and/or CPF Board)
allow one to take up both Incomeshield (paid with cash instead) and another
Shield plan (e.g. Aviva's MyShield) (paid from CPF Medisave) at the same
time. If it is possible, how will the claim process be like with 2 shield
plans?
REPLY
Dear
I am sorry to learn about your father's medical condition. Is your father covered under a dread disease policy? He can claim under this policy for a cash benefit.
For Incomeshield, we will be introduced a rider that can pay more, for major illness. The additional premium is 15% of the standard premium. It should cover all of the medical bill for your father's case, apart from the mandatory deductible and co-insurance. Under plan B, the premium will be about 30% lower than the expensive
plan that covers everthing "as charged".
The rider should be ready within two months.
Tan Kin Lian
Dear Mr Tan,
I am a fan of your blog. My family are gratefully insured under Incomeshield for many years. Your recent discussion on affordable medical insurance prompts me to seek your advice.
In about a week's time, my father is likely to undergo an angioplasty op by a referred doctor in SGH's National Heart Centre, likely under "minimum" B1 ward. Based on our calculation, we may be able to claim less than half of the hospital bill from Incomeshield. My dad is under Plan B.
This prompts me to think of getting my family a second medical plan (a backup) that may cover the higher cost should special circumstances that need private or Class B1 govt ward arise in the future.
However, we do not wish to give up on Incomeshield which we have great faith in in taking care of us in decades to come. And I know private medical plans are very
expensive (as you have mentioned) and also have to be paid by cash.
I would like to seek your advice on whether NTUC Income (and/or CPF Board)
allow one to take up both Incomeshield (paid with cash instead) and another
Shield plan (e.g. Aviva's MyShield) (paid from CPF Medisave) at the same
time. If it is possible, how will the claim process be like with 2 shield
plans?
REPLY
Dear
I am sorry to learn about your father's medical condition. Is your father covered under a dread disease policy? He can claim under this policy for a cash benefit.
For Incomeshield, we will be introduced a rider that can pay more, for major illness. The additional premium is 15% of the standard premium. It should cover all of the medical bill for your father's case, apart from the mandatory deductible and co-insurance. Under plan B, the premium will be about 30% lower than the expensive
plan that covers everthing "as charged".
The rider should be ready within two months.
Tan Kin Lian
Saturday, January 28, 2006
Mr Yap: happy with investment-linked funds
Mr Yap, 43, was one of many policyholders who invested with NTUC Income and made a positive profit. Mr Yap started investing in Technology Fund in October 2002.
Mr Yap committed all his investment between October 2002 to May 2003. There were no education seminars then. He was able to get advice through various discussions with his peers.
Mr Yap is very happy with his investments in Investment Link Products ILP). He has invested in high risk funds such as Technology, Japan, Europe and Growth. He invested about $110,000 in total and have realised $80,000 of his investment, making a profit of about 45% over 2 years!
" I would definitely invest more in future. In the past, I do not believe in ILP or unit trust as the price movement is slow. I prefer higher risk instruments like shares and warrants.
However, I learnt some painful lessons which comes with very bad losses. The lesson leant is, for working people like me, it is better to leave the investment to the professional fund managers who charged reasonable costs. "
Mr Yap acknowledges that it is also less stressful to invest in investment funds and to aim for reasonable good returns. Investing in speculative stocks can be a very stressful experience for a already busy man like him.
" I will not hesitant to recommend my friends to invest with NTUC Income."
Mr Yap committed all his investment between October 2002 to May 2003. There were no education seminars then. He was able to get advice through various discussions with his peers.
Mr Yap is very happy with his investments in Investment Link Products ILP). He has invested in high risk funds such as Technology, Japan, Europe and Growth. He invested about $110,000 in total and have realised $80,000 of his investment, making a profit of about 45% over 2 years!
" I would definitely invest more in future. In the past, I do not believe in ILP or unit trust as the price movement is slow. I prefer higher risk instruments like shares and warrants.
However, I learnt some painful lessons which comes with very bad losses. The lesson leant is, for working people like me, it is better to leave the investment to the professional fund managers who charged reasonable costs. "
Mr Yap acknowledges that it is also less stressful to invest in investment funds and to aim for reasonable good returns. Investing in speculative stocks can be a very stressful experience for a already busy man like him.
" I will not hesitant to recommend my friends to invest with NTUC Income."
Refinance your home loan?
Are you worried about higher interest rates on your home loan?
If you home loan is $500,000 and your bank increase the interest rate by 1%, you have to pay $5,000 more in interest each year. Your bank can continue to increase the interest rate after that, depending on the market condition.
You can protect against higher interest rate by re-financing your home loan with a fixed rate loan. NTUC Income can offer you 5 year loan at a fixed interest rate of 3.99% per annum. This interest rate will not be changed for the next 5 years.
In the market, a bank now offers a 5 year loan fixed at 4.25% per annum. If you take a loan of $500,000 from us, you will save $1,300 a year (compared to the rate charged by the bank).
NTUC Income offers these attractive terms to re-finance your home loan:
- switch to our flexi rate at the end of 3 years.
- free processing and valuation.
- free fire insurance for first year.
- legal fees absorbed by us (for refinance only) *
- payment holiday up to 12 months *
* terms and conditions apply
If you home loan is $500,000 and your bank increase the interest rate by 1%, you have to pay $5,000 more in interest each year. Your bank can continue to increase the interest rate after that, depending on the market condition.
You can protect against higher interest rate by re-financing your home loan with a fixed rate loan. NTUC Income can offer you 5 year loan at a fixed interest rate of 3.99% per annum. This interest rate will not be changed for the next 5 years.
In the market, a bank now offers a 5 year loan fixed at 4.25% per annum. If you take a loan of $500,000 from us, you will save $1,300 a year (compared to the rate charged by the bank).
NTUC Income offers these attractive terms to re-finance your home loan:
- switch to our flexi rate at the end of 3 years.
- free processing and valuation.
- free fire insurance for first year.
- legal fees absorbed by us (for refinance only) *
- payment holiday up to 12 months *
* terms and conditions apply
Annuity income is free of tax
If you buy an annuity, the payment that you receive each month is free of personal income tax.
Here is an example:
- you invest $100,000 in a life annuity at age 62
- you get $446 a month (giving a return of 5.3% yearly)
- your annuity income is increased yearly by the bonus declared (not guaranteed)
- refund of your capital less payments received, on early death
The income that you receive each year is free of income tax.
Get an attractive return on your life annuity, free of personal income tax on it.
Here is an example:
- you invest $100,000 in a life annuity at age 62
- you get $446 a month (giving a return of 5.3% yearly)
- your annuity income is increased yearly by the bonus declared (not guaranteed)
- refund of your capital less payments received, on early death
The income that you receive each year is free of income tax.
Get an attractive return on your life annuity, free of personal income tax on it.
Enjoy discount on your insurance
We asked our policyholders in a survey how we can best serve them in 2006. 80% said that they to get a discount on their next purchase of insurance.
You can find a suitable plan and get a discount when you visit www.KnowYourInsurance.com.sg.
You can find a suitable plan and get a discount when you visit www.KnowYourInsurance.com.sg.
Sabah - an interesting holiday destination
Sabah is now becoming an interesting holiday destination for Singaporeans.
The attractions are:
- nature, adventure, montain climbing, marine parks, diving, golfing
- low cost airfare now available through Silk Air (promotion: $240 return)
- good food, sea food
- nice and friendly people, culture
NTUC Income will be offering a special promotion for policyholders.
Get more details. Visit www.KnowYourInsurance.com.sg. Select "Sabah".
The attractions are:
- nature, adventure, montain climbing, marine parks, diving, golfing
- low cost airfare now available through Silk Air (promotion: $240 return)
- good food, sea food
- nice and friendly people, culture
NTUC Income will be offering a special promotion for policyholders.
Get more details. Visit www.KnowYourInsurance.com.sg. Select "Sabah".
Thursday, January 26, 2006
Medical insurance can be very costly, when you get old
An Australian actuary was surprised to learn that medical insurance premium in Singapore increase with age. He asked, "how is the old folk able to afford paying the premium, which will be very expensive? "
Here is my reply.
NTUC Income offers premium rates at a more affordable level. We offer a choice of 4 plans.
At a younger age, the policyholder can opt for a better plan (eg plan P or plan A) and pay a higher premium. The premium rate is still affordable, ie less than $300 a year.
When the policyholder retires after age 60, the premium can be quite steep, more than $1,000 a year. At that time, the policyholder can move to a lower plan (eg plan B or plan C) and pay a lower premium (compared to plan P or plan A).
Most of the other insurers charge premium rates that are 20% to 50% higher than NTUC Income. Their premium rates will be very expensive at the older ages. It could be $3,000 or more a year.
Advice: take your medical insurance from NTUC Income. We will keep it affordable for you.
Here is my reply.
NTUC Income offers premium rates at a more affordable level. We offer a choice of 4 plans.
At a younger age, the policyholder can opt for a better plan (eg plan P or plan A) and pay a higher premium. The premium rate is still affordable, ie less than $300 a year.
When the policyholder retires after age 60, the premium can be quite steep, more than $1,000 a year. At that time, the policyholder can move to a lower plan (eg plan B or plan C) and pay a lower premium (compared to plan P or plan A).
Most of the other insurers charge premium rates that are 20% to 50% higher than NTUC Income. Their premium rates will be very expensive at the older ages. It could be $3,000 or more a year.
Advice: take your medical insurance from NTUC Income. We will keep it affordable for you.
Insure your new car with NTUC Income
If you buy a new car, you can insure it with NTUC Income. We offer:
- lower premium, representing a saving of $200 to $400 a year, every year
- protection against loss of warranty, if voided by the manufacturer
- repair at the manufacturer's workshop, if proprietary equipment is needed
- replace with a new car, if it is stolen or totally lost during the first year
You can also get an attractive loan from us.
Give us a call, before you look for your car. We can give you an attractive offer.
6477 7722
http://www.income.coop/insurance/motor/
- lower premium, representing a saving of $200 to $400 a year, every year
- protection against loss of warranty, if voided by the manufacturer
- repair at the manufacturer's workshop, if proprietary equipment is needed
- replace with a new car, if it is stolen or totally lost during the first year
You can also get an attractive loan from us.
Give us a call, before you look for your car. We can give you an attractive offer.
6477 7722
http://www.income.coop/insurance/motor/
Wednesday, January 25, 2006
Does buying an annuity help avoid estate duty?
25 January 2006
Editor
Forum Page
Straits Times
I refer to the letter "Does buying an annuity help avoid estate duty" by Ms Chua Qiing Yuan (St Times 24 January).
Ms Chua referred to my previous letter that was printed in the Straits Times on 29 December. I wish to clarify this matter.
Under a life annuity, the purchaser pays a capital sum to receive an income stream for a lifetime. The life insurance company estimates the future income from investing the capital sum and pays out the total capital and income over the expected lifetime of the annuitant. On death, the capital sum is treated as fully expended.
For example, a male annuitant at age 62 can invest $100,000 in a participating life annuity that pays back a monthly income of $524 for a lifetime. This represents a notional return of 6.3% on the invested sum. I use the word "notional return" as it includes a refund of the capital. The monthly income may be increased by a bonus yearly, depending on the actual investment return of the fund. The bonus will increase the notional return.
The annuitant can opt to receive a lower monthly payment of $446 in return for a capital guarantee. In this case, the balance of the capital sum (excluding interest), less the annuity payments received, will be refunded in the event of early death of the annuitant. If the total annuity payment is more than the capital sum, there is no refund.
If there is a refund at the time of death, that refund will be treated as part of the estate and is subject to estate duty. This estate duty is likely to be small, as a significant portion of the capital may have been paid back already.
Most annuitants are likely to survive beyond the refund period or may have bought a life annuity that does not have a capital guarantee. In this case, there is no estate duty.
The key advantage of a life annuity is that it pays an attractive income that is guaranteed for a lifetime. The payout continues even after the capital sum and accrued income has been fully paid out. This is only possible because the annuitants who die earlier leaves behind the balance of their money to pay the annuitants who live longer. This is the concept of sharing of risks.
There is another signficant advantage, often overlooked. The monthly income is
fully exempt from personal income tax. This applies to most life annuities, except those purchased under some special arrangement, such as the Supplementary Retirement Scheme.
NTUC Income has 29,000 annuitants who have invested a total of $1,450 million in these contracts. The average investment is $50,000 per annuitant. The average payout is $4,100 yearly, presenting a notional return of 8.2% on the invested sum.
Tan Kin Lian
Chief Executive Officer
Editor
Forum Page
Straits Times
I refer to the letter "Does buying an annuity help avoid estate duty" by Ms Chua Qiing Yuan (St Times 24 January).
Ms Chua referred to my previous letter that was printed in the Straits Times on 29 December. I wish to clarify this matter.
Under a life annuity, the purchaser pays a capital sum to receive an income stream for a lifetime. The life insurance company estimates the future income from investing the capital sum and pays out the total capital and income over the expected lifetime of the annuitant. On death, the capital sum is treated as fully expended.
For example, a male annuitant at age 62 can invest $100,000 in a participating life annuity that pays back a monthly income of $524 for a lifetime. This represents a notional return of 6.3% on the invested sum. I use the word "notional return" as it includes a refund of the capital. The monthly income may be increased by a bonus yearly, depending on the actual investment return of the fund. The bonus will increase the notional return.
The annuitant can opt to receive a lower monthly payment of $446 in return for a capital guarantee. In this case, the balance of the capital sum (excluding interest), less the annuity payments received, will be refunded in the event of early death of the annuitant. If the total annuity payment is more than the capital sum, there is no refund.
If there is a refund at the time of death, that refund will be treated as part of the estate and is subject to estate duty. This estate duty is likely to be small, as a significant portion of the capital may have been paid back already.
Most annuitants are likely to survive beyond the refund period or may have bought a life annuity that does not have a capital guarantee. In this case, there is no estate duty.
The key advantage of a life annuity is that it pays an attractive income that is guaranteed for a lifetime. The payout continues even after the capital sum and accrued income has been fully paid out. This is only possible because the annuitants who die earlier leaves behind the balance of their money to pay the annuitants who live longer. This is the concept of sharing of risks.
There is another signficant advantage, often overlooked. The monthly income is
fully exempt from personal income tax. This applies to most life annuities, except those purchased under some special arrangement, such as the Supplementary Retirement Scheme.
NTUC Income has 29,000 annuitants who have invested a total of $1,450 million in these contracts. The average investment is $50,000 per annuitant. The average payout is $4,100 yearly, presenting a notional return of 8.2% on the invested sum.
Tan Kin Lian
Chief Executive Officer
Monday, January 23, 2006
90 people visit my blog each day
This blog has a site meter. It records the number of visitors each day. My site meter shows that 90 people visit my blog each day.
Do tell your friends to visit my blog. I will post my views on insurance, financial and social issues. I hope that you find them to be useful.
Do tell your friends to visit my blog. I will post my views on insurance, financial and social issues. I hope that you find them to be useful.
Why is term insurance not popular?
Someone asked me, "Why is term insurance not popular?"
The answer is, "agents prefer to sell endowment and whole life insurance".
For example, a policyholder can buy term insurance for $100,000 over 20 years by paying a premium of $400 a year. If they buy a whole life policy, they pay a premium of $2000 a year.
Agents can earn commission of up to 1.5 years of premium when they sell a whole life policy. Yes, they can earn $3,000 on selling a whole life policy to you. You pay for it through the higher premium.
They earn less on their term insurance policy. Maybe $200 to $400 in commission.
So, agents sell whole life and endowment policy. They tell the customer that this is a better plan for the customer. They did not tell the customer that they earn a higher commission.
In reality, the customer is better off to buy a term insurance and to invest the difference in a unit trust or investment linked plan (such as the Ideal plan from NTUC Income) where 100% of the savings is invested.
Be careful about buying a ILP from other insurers. They may take away 1.5 years of your savings as well.
The answer is, "agents prefer to sell endowment and whole life insurance".
For example, a policyholder can buy term insurance for $100,000 over 20 years by paying a premium of $400 a year. If they buy a whole life policy, they pay a premium of $2000 a year.
Agents can earn commission of up to 1.5 years of premium when they sell a whole life policy. Yes, they can earn $3,000 on selling a whole life policy to you. You pay for it through the higher premium.
They earn less on their term insurance policy. Maybe $200 to $400 in commission.
So, agents sell whole life and endowment policy. They tell the customer that this is a better plan for the customer. They did not tell the customer that they earn a higher commission.
In reality, the customer is better off to buy a term insurance and to invest the difference in a unit trust or investment linked plan (such as the Ideal plan from NTUC Income) where 100% of the savings is invested.
Be careful about buying a ILP from other insurers. They may take away 1.5 years of your savings as well.
Friday, January 20, 2006
Beware about the distribution charges under ILP
Beware about the distribution charges, when you buy a regular premuim investment linked product (ILP).
Some products take away nearly 2 years of your savings. If you annual savings is $3,000, you stand to lose up to $6,000. This is used to pay commission to the insurance agent.
If you buy the ILP from NTUC Income, 100% of your savings is invested from the first month.
What is the catch?
If you terminate your policy within 20 years, you are required to pay $40 a year for the remaining period. If you terminate on the 10th year, you have to pay a back end charge of $40 X 10 = $400. That is all.
This is, of course, much lower than $6,000.
The name of the ILP from NTUC Income is called Ideal plan (code: ID5). And here is another tip: you can save as much as you wish, say $500 a month, and you still pay the same back end charge. ID5 makes a lot of sense, if you save a large monthly sum.
Some products take away nearly 2 years of your savings. If you annual savings is $3,000, you stand to lose up to $6,000. This is used to pay commission to the insurance agent.
If you buy the ILP from NTUC Income, 100% of your savings is invested from the first month.
What is the catch?
If you terminate your policy within 20 years, you are required to pay $40 a year for the remaining period. If you terminate on the 10th year, you have to pay a back end charge of $40 X 10 = $400. That is all.
This is, of course, much lower than $6,000.
The name of the ILP from NTUC Income is called Ideal plan (code: ID5). And here is another tip: you can save as much as you wish, say $500 a month, and you still pay the same back end charge. ID5 makes a lot of sense, if you save a large monthly sum.
Thursday, January 19, 2006
My wish for budget 2006
Here is my wish for budget 2006.
I wish that the finance minister will encourage people to make private savings for their retirement. This is to supplement the Central Provident Fund savings, which has been significantly reduced in recent years.
In many countries, there is an attractive tax relief to encourage private savings. The savings are deducted from taxable income. But, as most lower and middle income earns do not pay income rate in Singapore, this may not work.
In the USA, the investment earnings from the retirement funds are deferred till retirement. Again, this will only work when most people pay income tax.
In all cases, there is a recognition by the government to forego some tax revenue to encourage people to make supplementary savings.
In Singapore, I suggest two possible ways to encourage more people, especially from the lower and middle income, to save for their retirement:
- government to contribute $1 for every $4 of savings; this scheme is similar to the baby bonus, but at a lower rate
- government to issue long term bonds that pays an attractive return that can only be invested by retirement funds; the return can be 1% or 2% higher than the market rate.
We need to have an attractive scheme that will encourage people to save for retirement. It will cost money to the government, but it will benefit the government in the long run, as there is less need to take care of poor old people.
I wish that the finance minister will encourage people to make private savings for their retirement. This is to supplement the Central Provident Fund savings, which has been significantly reduced in recent years.
In many countries, there is an attractive tax relief to encourage private savings. The savings are deducted from taxable income. But, as most lower and middle income earns do not pay income rate in Singapore, this may not work.
In the USA, the investment earnings from the retirement funds are deferred till retirement. Again, this will only work when most people pay income tax.
In all cases, there is a recognition by the government to forego some tax revenue to encourage people to make supplementary savings.
In Singapore, I suggest two possible ways to encourage more people, especially from the lower and middle income, to save for their retirement:
- government to contribute $1 for every $4 of savings; this scheme is similar to the baby bonus, but at a lower rate
- government to issue long term bonds that pays an attractive return that can only be invested by retirement funds; the return can be 1% or 2% higher than the market rate.
We need to have an attractive scheme that will encourage people to save for retirement. It will cost money to the government, but it will benefit the government in the long run, as there is less need to take care of poor old people.
Singaporeans, grow up!
I reproduce the letter from Cheyenne Yee, that was printed in Today 19 January. I agree with the views expressed in the letter. We need to mature as a society.
---------------------------------------
SORRY FOR THE INCONVENIENCE
Dear Mervyn Tan,
I pity you.
I pity you because you were born in a country where we would rather see you in jail than embrace your talent. Although you left the country and renounced your citizenship, we still want you to pay for an offence you commited almost 20 years ago.
You did not go through the same suffering as we did, and maybe we bear a grudge against people like you. We will not forgive you since we are not mature enough.
Maybe if you were a woman, it would be easier since women in Singapore do not serve National Service (NS). It is okay for them not to do it. But it is not okay for you. You have no choice.
The moment you are born male here, you have to serve NS even if your family decided to raise you elsewhere - even if you have few memories of this place, and no longer have a sense of belonging here. Sounds illogical, but this is how we work.
So, stay away. We really do not want you back. Even if you are world-famous. Come back ony when we grow up.
Cheyenne Yee
---------------------------------------
SORRY FOR THE INCONVENIENCE
Dear Mervyn Tan,
I pity you.
I pity you because you were born in a country where we would rather see you in jail than embrace your talent. Although you left the country and renounced your citizenship, we still want you to pay for an offence you commited almost 20 years ago.
You did not go through the same suffering as we did, and maybe we bear a grudge against people like you. We will not forgive you since we are not mature enough.
Maybe if you were a woman, it would be easier since women in Singapore do not serve National Service (NS). It is okay for them not to do it. But it is not okay for you. You have no choice.
The moment you are born male here, you have to serve NS even if your family decided to raise you elsewhere - even if you have few memories of this place, and no longer have a sense of belonging here. Sounds illogical, but this is how we work.
So, stay away. We really do not want you back. Even if you are world-famous. Come back ony when we grow up.
Cheyenne Yee
Reply to: Income agents quitting
19 January 2006
Editor
Forum Page
Straits Times
I refer to the article entitled "Income agents quitting over insurer's direct sales strategy" (St Times, 17 Jan).
Your article mentioned that 50 agents have left so far, angered by introduction of salaried team. This is not correct.
Each year, about 100 full time advisers leave us for a variety of reasons. Most of them leave for a change of career. This is also the experience in other life insurance companies. The decline of 50 full time advisers in 2005 was due primarily to a drop in the recruitment of new advisers.
We now have 700 full time advisers. They are doing quite well, and earned more than in previous years. They have benefitted from the sales promotions that accompany our new strategy.
We expect about 170 advisers to qualify for the prestigious Million Dollar Round Table based on their sales in 2005. This is an increase compared to 130 for the previous year.
To quality for the MDRT, the adviser has to earn at least $51,000 in commission on new insurance sales in each year. The actual earnings, including renewal commission, is much higher.
Our strategy is to serve our policyholders in the best possible way. We offer suitable insurance products that provide good value and best meet the needs of our policyholder. We will keep our expenses low, so that our policyholders will be able to enjoy the best possible return on their savings.
Our direct channel offers the chance for customers to enjoy the savings through a modest discount. To qualify for this discount, they have to visit our business center, and save on the time taken by our insurance advisers from visiting them in their home.
Our business center is now manned by salaried consultants. In the future, our insurance advisers may be able to offer the same modest discount to the customers, provided that the customers visit them in the office.
We also encourage customers to visit our educational website to learn about insurance on their own. The website www.KnowYourInsurance.com.sg now attracts 1,500 visitors each day.
We will continue to offer to customers the choice of being served by insurance advisers who visit their homes or workplaces. The customers will find our insurance products to be attractive, as the commissions paid to our insurance advisers are at a modest level, compared to the market. This channel continues to be an important pillar of our sales strategy.
Contrary to the impression given in your article, our insurance advisers will continue to have a bright future, as they will benefit from the business growth that is generated by our strategy to look after the best interest of policyholders.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Editor
Forum Page
Straits Times
I refer to the article entitled "Income agents quitting over insurer's direct sales strategy" (St Times, 17 Jan).
Your article mentioned that 50 agents have left so far, angered by introduction of salaried team. This is not correct.
Each year, about 100 full time advisers leave us for a variety of reasons. Most of them leave for a change of career. This is also the experience in other life insurance companies. The decline of 50 full time advisers in 2005 was due primarily to a drop in the recruitment of new advisers.
We now have 700 full time advisers. They are doing quite well, and earned more than in previous years. They have benefitted from the sales promotions that accompany our new strategy.
We expect about 170 advisers to qualify for the prestigious Million Dollar Round Table based on their sales in 2005. This is an increase compared to 130 for the previous year.
To quality for the MDRT, the adviser has to earn at least $51,000 in commission on new insurance sales in each year. The actual earnings, including renewal commission, is much higher.
Our strategy is to serve our policyholders in the best possible way. We offer suitable insurance products that provide good value and best meet the needs of our policyholder. We will keep our expenses low, so that our policyholders will be able to enjoy the best possible return on their savings.
Our direct channel offers the chance for customers to enjoy the savings through a modest discount. To qualify for this discount, they have to visit our business center, and save on the time taken by our insurance advisers from visiting them in their home.
Our business center is now manned by salaried consultants. In the future, our insurance advisers may be able to offer the same modest discount to the customers, provided that the customers visit them in the office.
We also encourage customers to visit our educational website to learn about insurance on their own. The website www.KnowYourInsurance.com.sg now attracts 1,500 visitors each day.
We will continue to offer to customers the choice of being served by insurance advisers who visit their homes or workplaces. The customers will find our insurance products to be attractive, as the commissions paid to our insurance advisers are at a modest level, compared to the market. This channel continues to be an important pillar of our sales strategy.
Contrary to the impression given in your article, our insurance advisers will continue to have a bright future, as they will benefit from the business growth that is generated by our strategy to look after the best interest of policyholders.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Monday, January 16, 2006
Work together to promote car sharing
NTUC Income operates the largest car sharing scheme in Singapore. We have 5,600 members sharing 200 cars located in 70 locations.
There are three other operators, namely CitySpeed, WhizzCar and Honda. Together, they have 5,400 members sharing 160 cars.
NTUC Income cooperates with the other operators to develop the car sharing market in Singapore. Each serves a different market segment. We meet regularly to share
experiences to improve the standard of carsharing service.
For example, NTUC Income shares our technology and call center facility with one of the operator.
I want to quote this example as another way for business to work in Singapore. We do not need to compete aggressively. We can cooperate to improve efficiency (and bring down cost) and quality of service.
There are three other operators, namely CitySpeed, WhizzCar and Honda. Together, they have 5,400 members sharing 160 cars.
NTUC Income cooperates with the other operators to develop the car sharing market in Singapore. Each serves a different market segment. We meet regularly to share
experiences to improve the standard of carsharing service.
For example, NTUC Income shares our technology and call center facility with one of the operator.
I want to quote this example as another way for business to work in Singapore. We do not need to compete aggressively. We can cooperate to improve efficiency (and bring down cost) and quality of service.
Sunday, January 15, 2006
Buying a new car?
BUYING A NEW CAR?
Take your insurance from NTUC Income and enjoy these excellent benefits:
- potential saving of $400 yearly on your insurance premium
- protection against loss of manufacturer warranty for 3 years **
- no extra loading on your premium, even if you had a bad accident **
- replacement with a new car, if it is stolen or total loss during the first year **
- repairs at manufacturer's workshops for engine and proprietary repairs **
- attractive terms for your car loan
** subject to conditions
Call 6477 7722
www.income.coop/insurance/motor/
www.income.coop/insurance/motor/comparison.asp
Take your insurance from NTUC Income and enjoy these excellent benefits:
- potential saving of $400 yearly on your insurance premium
- protection against loss of manufacturer warranty for 3 years **
- no extra loading on your premium, even if you had a bad accident **
- replacement with a new car, if it is stolen or total loss during the first year **
- repairs at manufacturer's workshops for engine and proprietary repairs **
- attractive terms for your car loan
** subject to conditions
Call 6477 7722
www.income.coop/insurance/motor/
www.income.coop/insurance/motor/comparison.asp
Stay with Incomeshield
Taken from NTUC Income's website
If you have been approached to switch from Incomeshield to another Shield product, you should consider your decision carefully. Here are some key advantages of Incomeshield:
- Our premium rates are more affordable than other Shield plans
- We provide adequate coverage to meet most medical treatments
- You can buy a rider to cover the deductible and co-insurance
- You can buy a rider to cover the major illnesses (for only 15% more)
- You can enjoy unlimited lifetime coverage
Here is a brief comparison of the total premium payable over 40 years (from age 41 to 80 years) between Incomeshield and similar Shield plans offered by other insurers:
The coverages provided by the various plans are quite similar, except for some diffferences in the limits. The difference in premium can be as much as 60%. You can save up to $12,000 over 40 years, by insuring with NTUC Income.
These premiums shown above are based on current rates. They are expected to increase in future years, due to higher medical costs. It is important that you choose an affordable plan from NTUC Income.
The insurance agent or broker who advise you to switch away from Incomeshield may have earned an attractive commission from the other insurer. The agent is required to tell you about the commisison that they will earn now and in the future.
If you wish to attend a dialogue session, you can call 6877-3366.
Tan Kin Lian
Chief Executive Officer
If you have been approached to switch from Incomeshield to another Shield product, you should consider your decision carefully. Here are some key advantages of Incomeshield:
- Our premium rates are more affordable than other Shield plans
- We provide adequate coverage to meet most medical treatments
- You can buy a rider to cover the deductible and co-insurance
- You can buy a rider to cover the major illnesses (for only 15% more)
- You can enjoy unlimited lifetime coverage
Here is a brief comparison of the total premium payable over 40 years (from age 41 to 80 years) between Incomeshield and similar Shield plans offered by other insurers:
Plan NTUC Income Other insurers
A $30,525 $34,071 to $42,263
B $18,338 $21,609 to $28,403
The coverages provided by the various plans are quite similar, except for some diffferences in the limits. The difference in premium can be as much as 60%. You can save up to $12,000 over 40 years, by insuring with NTUC Income.
These premiums shown above are based on current rates. They are expected to increase in future years, due to higher medical costs. It is important that you choose an affordable plan from NTUC Income.
The insurance agent or broker who advise you to switch away from Incomeshield may have earned an attractive commission from the other insurer. The agent is required to tell you about the commisison that they will earn now and in the future.
If you wish to attend a dialogue session, you can call 6877-3366.
Tan Kin Lian
Chief Executive Officer
Customers want to buy insurance directly
E-MAIL FROM CUSTOMER
Dear Mr Tan
I read your blog with great interest; it provides a lot of informative material with real life case studies.
I have been looking around for insurance policies to save for children and own retirement. I realise the amount of commissions that go to the adviser is quite high. Up to two years of premiums go towards their commissions.
I know that more professionals are now turning to financial advisers simply because they want to buy policies for themselves and their families without having to pay high commissions to agents.
NTUC has gone through a positive revolutionary changes under your stewardship. I look forward to a day when you become a one-stop shop for insurance. You should allow customers to buy insurance directly, without having to pay high commission.
People like me can read and understand the insurance products. All we want is to buy the product and not pay for the service of the agent.
For now, we do not seem to have a choice but to have to go through an agent. Every insurance company I have gone to has the same system.
Mr Tan, I sincerely implore that you kindly look into this revolutionary way of selling insurance. I can assure you there will be a lot of buyers who are interested to buy insurance in this way.
When that day comes, I will certainly be one of your first customers at the service counter. I hope that you will provide several counters, to service those who walked in, and those who made an appointment. I shall hold my breath and reserve my funds for now.
------------------
REPLY
Dear
We do have a business center that operates in the way that you wish for. It is is staffed by salaried consultants, who are able to provide advice and also to help you to find the right insurance policy to buy. We provide a modest discount to a customer who come to us directly.
Call 6788 1111 if you wish to make an appointment to see a consultant at our business center.
We also have an interactive and educational website for you to learn about the various insurance products. You can visit www.KnowYourInsurance.com.sg
Tan Kin Lian
Chief Executive Officer
Dear Mr Tan
I read your blog with great interest; it provides a lot of informative material with real life case studies.
I have been looking around for insurance policies to save for children and own retirement. I realise the amount of commissions that go to the adviser is quite high. Up to two years of premiums go towards their commissions.
I know that more professionals are now turning to financial advisers simply because they want to buy policies for themselves and their families without having to pay high commissions to agents.
NTUC has gone through a positive revolutionary changes under your stewardship. I look forward to a day when you become a one-stop shop for insurance. You should allow customers to buy insurance directly, without having to pay high commission.
People like me can read and understand the insurance products. All we want is to buy the product and not pay for the service of the agent.
For now, we do not seem to have a choice but to have to go through an agent. Every insurance company I have gone to has the same system.
Mr Tan, I sincerely implore that you kindly look into this revolutionary way of selling insurance. I can assure you there will be a lot of buyers who are interested to buy insurance in this way.
When that day comes, I will certainly be one of your first customers at the service counter. I hope that you will provide several counters, to service those who walked in, and those who made an appointment. I shall hold my breath and reserve my funds for now.
------------------
REPLY
Dear
We do have a business center that operates in the way that you wish for. It is is staffed by salaried consultants, who are able to provide advice and also to help you to find the right insurance policy to buy. We provide a modest discount to a customer who come to us directly.
Call 6788 1111 if you wish to make an appointment to see a consultant at our business center.
We also have an interactive and educational website for you to learn about the various insurance products. You can visit www.KnowYourInsurance.com.sg
Tan Kin Lian
Chief Executive Officer
Wednesday, January 11, 2006
Discount of $500 ??
Some dealers offer a further discount of $500 to the purchaser who agrees to insure the car with their tied insurer.
The premium charged by the tied insurer is much higher than NTUC Income. After the $500 discount, the difference is quite small. If you are already enjoying a loyalty discount of 5% from NTUC Income, it is better to stay with us.
The difference in premium could be $400 a year. If you insure for 10 years, you may be able to save $4,000 by insuring with NTUC Income.
The premium charged by the tied insurer is much higher than NTUC Income. After the $500 discount, the difference is quite small. If you are already enjoying a loyalty discount of 5% from NTUC Income, it is better to stay with us.
Model Tied NTUC
Insurer Income
Honda Civic 1.8 Sedan 5 $1995 $1575
Honda Jazz $1680 $1280
Nissan Sunny 1.6 EX Auto $1578 $1319
Vios 1.5 Auto $1578 $1172
The difference in premium could be $400 a year. If you insure for 10 years, you may be able to save $4,000 by insuring with NTUC Income.
Tuesday, January 10, 2006
Invest in a well diversified fund with low charges
I saw an investment product offered by a bank that has the following features:
- sales charge of 5%
- annual management fee of 1.75%
- pays out 8% per year, but this may be done by eroding the capital
- sell call warrants
Selling the call warrants allows the fund to earn income, but it also caps the gain that can be earned.
It is better to invest in the combined fund offered by NTUC Income. It is well diversifed and imposes a sales charge of 3.5% and an annual management fee of 0.95%. Due to the difference in charges over a 10 year period, the investment in the combined fund will pay you 10% more than the product offered by the bank.
The actual return depends on the underlying return of the fund. Here I assume that they are both funds provide the same average return over 10 years.
Advice: it is better to invest in simple financial products that have low charges.
Visit www.askdrmoney.com to get a comparison of the charges.
- sales charge of 5%
- annual management fee of 1.75%
- pays out 8% per year, but this may be done by eroding the capital
- sell call warrants
Selling the call warrants allows the fund to earn income, but it also caps the gain that can be earned.
It is better to invest in the combined fund offered by NTUC Income. It is well diversifed and imposes a sales charge of 3.5% and an annual management fee of 0.95%. Due to the difference in charges over a 10 year period, the investment in the combined fund will pay you 10% more than the product offered by the bank.
The actual return depends on the underlying return of the fund. Here I assume that they are both funds provide the same average return over 10 years.
Advice: it is better to invest in simple financial products that have low charges.
Visit www.askdrmoney.com to get a comparison of the charges.
Avoid Investing in Structured Products
I avoid investing in structured products.
Here are my reasons:
- these products have high charges
- the charges are not transparent
- they sometimes have risks which are not well explained
- the investor usually do not get the full gains from the investment.
It is better to invest in unit trusts or investment linked funds. The charges are disclosed to you. Although the investor is exposed to the risk, at least the full gain goes to the investor.
It is better to invest in simple, transparent products.
Here are my reasons:
- these products have high charges
- the charges are not transparent
- they sometimes have risks which are not well explained
- the investor usually do not get the full gains from the investment.
It is better to invest in unit trusts or investment linked funds. The charges are disclosed to you. Although the investor is exposed to the risk, at least the full gain goes to the investor.
It is better to invest in simple, transparent products.
Thursday, January 05, 2006
Save $50 to $200 on your motor insurance premium
We compared the motor insurance premium for 10 popular models charged by NTUC Income, company A and company X. These are the three largest motor insurers in Singapore.
The comparisons are shown in www.income.coop/insurance/motor/comparison.asp
The premium rate for NTUC Income are between $50 to $200 cheaper than the two insurers.
Our policyholders can enjoy the further 10% discount, as follows:
- discount of 5% when they insure directly with us
- discount of 5% when they insure with us for three years or longer.
You can save a lot of money every year, by insuring with NTUC Income. We hold a 40% market share. Many people like our attractive premium rates, good service and convenience (ie report accident at Idac center and let us take care of the repair).
The comparisons are shown in www.income.coop/insurance/motor/comparison.asp
The premium rate for NTUC Income are between $50 to $200 cheaper than the two insurers.
Our policyholders can enjoy the further 10% discount, as follows:
- discount of 5% when they insure directly with us
- discount of 5% when they insure with us for three years or longer.
You can save a lot of money every year, by insuring with NTUC Income. We hold a 40% market share. Many people like our attractive premium rates, good service and convenience (ie report accident at Idac center and let us take care of the repair).
Refund of annuity are subject to estate duty
Someone asked me if the refund of capital on a life annuity is subject to estate duty.
The answer is "yes". It forms part of the estate. But, the refund is likely to be less than the invested capital (as the capital is reduced by each payment). If the annuitant dies after 15 years, the refund will disappear.
Some life annuity does not have a refund feature, and pays a higher amount.
Similarly, any gift made during 5 years before death is also subject to estate duty. Most people will live more than 5 years after making the gift, if they do it at a younger age.
I advise people - make your gift earlier when you are not too old. It will be more useful to your children when they start their own family or buy a house. If you do not wish to give them a lump sum, buy a term annuity so that your gift is given to them in installments.
The answer is "yes". It forms part of the estate. But, the refund is likely to be less than the invested capital (as the capital is reduced by each payment). If the annuitant dies after 15 years, the refund will disappear.
Some life annuity does not have a refund feature, and pays a higher amount.
Similarly, any gift made during 5 years before death is also subject to estate duty. Most people will live more than 5 years after making the gift, if they do it at a younger age.
I advise people - make your gift earlier when you are not too old. It will be more useful to your children when they start their own family or buy a house. If you do not wish to give them a lump sum, buy a term annuity so that your gift is given to them in installments.
Increase regular savings
In a recent survey, I was surprised to learn that 50% of people in the age gropu 40 to 55 wants to increase their regular savings.
This suggests that many people realise that they have inadequate savings for their retirement needs.
I thought that this group is likely to be squeezed by the cost of living, medical bills, repaying loans, and sending children to university.
But, they must have taken these factors into account, and decide that they need more savings.
What is the best plan to meet this need?
It is the ideal plan from NTUC Income:
- 100% of savings is invested from first month
- invested in the combined fund: large, well diversifed, low charges, attractive return
- cost of insurance protection is low, use the decreasing term assurance.
I hold educational seminars every two weeks. Call 6877 3366 to register.
This suggests that many people realise that they have inadequate savings for their retirement needs.
I thought that this group is likely to be squeezed by the cost of living, medical bills, repaying loans, and sending children to university.
But, they must have taken these factors into account, and decide that they need more savings.
What is the best plan to meet this need?
It is the ideal plan from NTUC Income:
- 100% of savings is invested from first month
- invested in the combined fund: large, well diversifed, low charges, attractive return
- cost of insurance protection is low, use the decreasing term assurance.
I hold educational seminars every two weeks. Call 6877 3366 to register.
Wednesday, December 28, 2005
Spirt of Enterprise Award
The Spirit of Enterprise invites nomination for the 2006 awards. Any business that meets the criteria below can be nominated, inculding pizza parlors, clothing stores, discos etc.
Criteria: These are just general guidelines, and the panel exercise flexibility. (for past nominees see: www.soe.org.sg )
1. In business for at least 5 years and is successful enough to provide the family’s needs.
2. Is in good standing with whoever licenses the business and is not under any court, tax or police filing.
3. A small to medium enterprise, which has an inspiring and interesting story to be told. Preferably, it has some historical antecedents in the history of Singapore.
4. Special attention will be paid to an entrepreneur who is innovative, forward-looking, constantly planning to bring the company to another greater phase. For example, entering new markets, introducing new products or services or willing to use new technologies to increase productivity and consumer services.
5. Not a recipient of Temasek or any similar government investment programmes.
6. Has not been honoured by any similar group.
Send your nomination to: www.soe.org.sg
Criteria: These are just general guidelines, and the panel exercise flexibility. (for past nominees see: www.soe.org.sg )
1. In business for at least 5 years and is successful enough to provide the family’s needs.
2. Is in good standing with whoever licenses the business and is not under any court, tax or police filing.
3. A small to medium enterprise, which has an inspiring and interesting story to be told. Preferably, it has some historical antecedents in the history of Singapore.
4. Special attention will be paid to an entrepreneur who is innovative, forward-looking, constantly planning to bring the company to another greater phase. For example, entering new markets, introducing new products or services or willing to use new technologies to increase productivity and consumer services.
5. Not a recipient of Temasek or any similar government investment programmes.
6. Has not been honoured by any similar group.
Send your nomination to: www.soe.org.sg
Estate duty puts retirees in a dilemma
Editor
Forum Page
Straits Times
I refer to the letter from Ms Janice Ong entitled "Estate Duty puts retirees in a dilemma" (ST 28 Dec 2005).
Currently, estate duty is payable on liquid assets in excess of $600,000. Ms Ong said that a retiree needs more than $600,000 to maintain a reasonable standard of living.
I wish to give the following suggestions to a retiree with large savings on how to avoid paying estate duty.
1. Invest a significant portion of your lifetime savings in a life annuity. It pays an attractive monthly income which is guaranteed for a lifetime. As the life annuity includes the gradual release of capital during the expected lifetime of the retiree, it will be free of estate duty.
2. Invest in a participating annuity which increases with bonus in most years. The increased payment will help to offset the higher cost of living.
3. Keep up to $600,000 in liquid assets. This gives you the flexibility to meet unexpected cash needs, and is within the exemption limit.
4. Transfer any remaining savings to your children earlier, rather than on your death. If you do not wish to make a lump sum gift, you can buy a term annuity to transfer the money in annual sums over a certain number of years.
You can find more about life annuity from our website, http://www.income.coop/insurance/glannuity
NTUC Income has a market share of about 60 percent of all annuities sold in Singapore. Nearly 30,000 people have bought an annuity from us. Most retirees invest between $50,000 to $100,000. The largest investment in an annuity exceed $1 million.
Tan Kin Lian
Chief Executive Officer
Forum Page
Straits Times
I refer to the letter from Ms Janice Ong entitled "Estate Duty puts retirees in a dilemma" (ST 28 Dec 2005).
Currently, estate duty is payable on liquid assets in excess of $600,000. Ms Ong said that a retiree needs more than $600,000 to maintain a reasonable standard of living.
I wish to give the following suggestions to a retiree with large savings on how to avoid paying estate duty.
1. Invest a significant portion of your lifetime savings in a life annuity. It pays an attractive monthly income which is guaranteed for a lifetime. As the life annuity includes the gradual release of capital during the expected lifetime of the retiree, it will be free of estate duty.
2. Invest in a participating annuity which increases with bonus in most years. The increased payment will help to offset the higher cost of living.
3. Keep up to $600,000 in liquid assets. This gives you the flexibility to meet unexpected cash needs, and is within the exemption limit.
4. Transfer any remaining savings to your children earlier, rather than on your death. If you do not wish to make a lump sum gift, you can buy a term annuity to transfer the money in annual sums over a certain number of years.
You can find more about life annuity from our website, http://www.income.coop/insurance/glannuity
NTUC Income has a market share of about 60 percent of all annuities sold in Singapore. Nearly 30,000 people have bought an annuity from us. Most retirees invest between $50,000 to $100,000. The largest investment in an annuity exceed $1 million.
Tan Kin Lian
Chief Executive Officer
Sunday, December 25, 2005
1,500 people visited educational website within 2 days
1,500 people visited the educational website, www.KnowYourInsurance.com.sg,
within 2 days of its launch.
180 passed the test. They are eligible for a discount when they buy insurance from NTUC Income.
within 2 days of its launch.
180 passed the test. They are eligible for a discount when they buy insurance from NTUC Income.
Friday, December 23, 2005
NTUC Income offers fair settlement of claims
NTUC Income offers fair settlement of claims. Sometimes, the clainmant is badly advised and tried to ask for a higher compensation. Here is a recent case.
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Our insured, who was driving a motor cycle, had hit into the deceased, who was crossing a 4 lane road (not at a pedestrian crossing). Approximately 2 weeks after the accident, the deceased died.
The deceased's wife made a clim in excess of $250,000 for dependency and pain and suffering suffered by her late husband.
Our claims committee made an offer to settle the claim for $35,000. The claimant rejected our offer and insisted on $250,000.
This matter was heard in court. The final award was for $26,000. With interest, the total was $29,000.
Cost of $6000 was awarded against the claimant. We were also allowed to claim for our cost of $30,000 to defend the claim in the high court.
This has been very costly for the claimant. If she had been properly advised, she should have accepted our offer of $35,000 and save a lot of money on legal expenses.
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Our insured, who was driving a motor cycle, had hit into the deceased, who was crossing a 4 lane road (not at a pedestrian crossing). Approximately 2 weeks after the accident, the deceased died.
The deceased's wife made a clim in excess of $250,000 for dependency and pain and suffering suffered by her late husband.
Our claims committee made an offer to settle the claim for $35,000. The claimant rejected our offer and insisted on $250,000.
This matter was heard in court. The final award was for $26,000. With interest, the total was $29,000.
Cost of $6000 was awarded against the claimant. We were also allowed to claim for our cost of $30,000 to defend the claim in the high court.
This has been very costly for the claimant. If she had been properly advised, she should have accepted our offer of $35,000 and save a lot of money on legal expenses.
Thursday, December 22, 2005
NTUC Income's contribution to NKF
In 1990, NTUC Income contributed $300,000 to set up the NKF dialysis center in Bukit Batok and $50,000 (raised from our staff and agents) for the running cost of the center. This was a special project under our 20th anniversary celebration.
In the subsequent years, we contributed a very modest sum (ie less than $5,000 a year) to the NKF. We felt that NKF was already raising more than needed from other sources.
During tihs period, we channelled our contribution to the Community Chest, which served 100 times the number of beneficiaries in Singapore. In 2005, we contribute nearly $250,000 to the Community Chest. This compriseof the contribution from the staff and matching contribution from NTUC Income.
We will find appropriate ways to support the NKF in future years, based on its future needs. We urge the public to continue its support of the NKF, who is charting its future directions.
In the subsequent years, we contributed a very modest sum (ie less than $5,000 a year) to the NKF. We felt that NKF was already raising more than needed from other sources.
During tihs period, we channelled our contribution to the Community Chest, which served 100 times the number of beneficiaries in Singapore. In 2005, we contribute nearly $250,000 to the Community Chest. This compriseof the contribution from the staff and matching contribution from NTUC Income.
We will find appropriate ways to support the NKF in future years, based on its future needs. We urge the public to continue its support of the NKF, who is charting its future directions.
600 people tried website within 1 week
NTUC Income's latest educational website has so far attracted more than 3,000 visitors. Last week alone, more than 600 people has registered and used this site.
We did a survey on this group of 600 users (of which 65 per cent are external users, i.e. non staff). A good 96 per cent responded that they are happy with the website and the quality of materials used.
The most popular topics are:
investment linked policies
medical insurance
i-Young (package for young people)
personal accident
motor insurance
We did a survey on this group of 600 users (of which 65 per cent are external users, i.e. non staff). A good 96 per cent responded that they are happy with the website and the quality of materials used.
The most popular topics are:
investment linked policies
medical insurance
i-Young (package for young people)
personal accident
motor insurance
New website to educate public on insurance
NTUC Income is pleased to announce the launch of an educational and interactive website on insurance at www.KnowYourInsurance.com.sg.
Many people may not think about insurance until they are approached by an insurance agent. Some people do not like to meet up with an insurance agent, as they fear that they may be pressured into buying insurance policies that they do not need or cannot afford. Many people also find insurance quite complicated.
However, it is important that everyone should have insurance to protect against the risk of premature death, accidents or major illnesses.
NTUC Income recently conducted a public survey to better understand the insurance needs of people between 30 to 40 years old. The results interestingly revealed that about 70 per cent of the respondents preferred learning the basic facts of insurance in their own time, if it can be made easily available to them.
KnowYourInsurance.com.sg is the new approach in educating the public on insurance.
Chief Executive Officer Tan Kin Lian said, "NTUC Income believes in educating our consumers on insurance products and helping them to make the right choices. By setting up this educational website, we provide an option to the consumer to learn about the basic facts of insurance on their own. It is an easy and fun way to learn."
The website covers the common insurance products, such as motor insurance, personal accident, financial planning, travel insurance, saving for education and medical insurance."
This website has an added, challenging feature for the visitors to test their knowledge at the end of each topic. A visitor who completes the test will also receive a discount when he or she purchases an insurance policy directly from NTUC Income.
Many people may not think about insurance until they are approached by an insurance agent. Some people do not like to meet up with an insurance agent, as they fear that they may be pressured into buying insurance policies that they do not need or cannot afford. Many people also find insurance quite complicated.
However, it is important that everyone should have insurance to protect against the risk of premature death, accidents or major illnesses.
NTUC Income recently conducted a public survey to better understand the insurance needs of people between 30 to 40 years old. The results interestingly revealed that about 70 per cent of the respondents preferred learning the basic facts of insurance in their own time, if it can be made easily available to them.
KnowYourInsurance.com.sg is the new approach in educating the public on insurance.
Chief Executive Officer Tan Kin Lian said, "NTUC Income believes in educating our consumers on insurance products and helping them to make the right choices. By setting up this educational website, we provide an option to the consumer to learn about the basic facts of insurance on their own. It is an easy and fun way to learn."
The website covers the common insurance products, such as motor insurance, personal accident, financial planning, travel insurance, saving for education and medical insurance."
This website has an added, challenging feature for the visitors to test their knowledge at the end of each topic. A visitor who completes the test will also receive a discount when he or she purchases an insurance policy directly from NTUC Income.
Wednesday, December 21, 2005
Reply: accident with taxi leads to insurance woes
21 December 2005
The Editor
Online Forum Page
Straits Times
I refer to the letter entitled "Accident with taxi leads to insurance woes" by Jonathan Tan Meng Chye (ST Online Forum, 19 Dec 2005).
NTUC Income insures about 40 percent of all vehicles in Singapore. Our policyholders regularly encounter this type of situation. We wish to give the following advice, as a guide to motorists.
Motorists must always maintain a safe distance from the car in front. They should be able to stop in time without hitting it in the event the car in front has to stop suddenly. The recommended distance between cars is about 2 car lengths.
When a car collides squarely into the back of a car, the presumption is that the driver of the rear car was negligent in not keeping a safe distance. To overcome this presumption, the onus is on the driver to prove that the front car had cut so suddenly into his path that he was unable to avoid colliding into it.
The workshops that were approached by Mr Tan were not keen to assist him in pursuing a claim against the taxi driver, as it will be an uphill task to prove his case. He should have a witness to prove his assertion that the taxi driver had cut into his path to succeed fully or partially in his third party claim.
If Mr. Tan is able to prove his case, the law and our courts will protect him and enable him to recover his loss from the third party. Further, if Mr. Tan is able to prove that the taxi driver was negligent, he will be able to recover part of his legal costs from the taxi driver. Generally, the legal costs recoverable from the party at fault is about two-third of the costs that the successful party would have to pay his own lawyer.
In this case, we advise Mr. Tan to claim against his own insurance policy. If we are able to establish that the other driver was 80 per cent or more at fault, we will not penalise Mr. Tan's NCD.
Freddy Neo,
Claims Senior Manager
The Editor
Online Forum Page
Straits Times
I refer to the letter entitled "Accident with taxi leads to insurance woes" by Jonathan Tan Meng Chye (ST Online Forum, 19 Dec 2005).
NTUC Income insures about 40 percent of all vehicles in Singapore. Our policyholders regularly encounter this type of situation. We wish to give the following advice, as a guide to motorists.
Motorists must always maintain a safe distance from the car in front. They should be able to stop in time without hitting it in the event the car in front has to stop suddenly. The recommended distance between cars is about 2 car lengths.
When a car collides squarely into the back of a car, the presumption is that the driver of the rear car was negligent in not keeping a safe distance. To overcome this presumption, the onus is on the driver to prove that the front car had cut so suddenly into his path that he was unable to avoid colliding into it.
The workshops that were approached by Mr Tan were not keen to assist him in pursuing a claim against the taxi driver, as it will be an uphill task to prove his case. He should have a witness to prove his assertion that the taxi driver had cut into his path to succeed fully or partially in his third party claim.
If Mr. Tan is able to prove his case, the law and our courts will protect him and enable him to recover his loss from the third party. Further, if Mr. Tan is able to prove that the taxi driver was negligent, he will be able to recover part of his legal costs from the taxi driver. Generally, the legal costs recoverable from the party at fault is about two-third of the costs that the successful party would have to pay his own lawyer.
In this case, we advise Mr. Tan to claim against his own insurance policy. If we are able to establish that the other driver was 80 per cent or more at fault, we will not penalise Mr. Tan's NCD.
Freddy Neo,
Claims Senior Manager
Saturday, December 17, 2005
MMS initiative has got off to an encouraging start
Since the launch of this initiative one month ago , 40 policyholders had sent in their accident photos to NTUC Income.
This innovative approach helps the insurer to better handle iability dispute between the parties involved in the accident.
The policyholders are encouraged to use the mobilephone to take photographs of the damages to the vehicles immediately at the scene of the accident and to send them by MMS to NTUC Income. With the photographs as additional evidence, the assessment officers will be able to decide more accurately of the apportionment of liability between the parties.
This has proved to be effective. For 50% of these cases, the photographs showed that our policyhbolder was not at fault in the accident. For 40% of the cases, the photographs showed that our policyholder was less at fault compared to the other party.
The photographs help to strengthen the report of our policyholders, in the situation where both parties give different versions of the accidents and damages.
NTUC Income has to deal with about 200 cases of accidents each month, where both parties dispute the facts of the accident. Based on our experience, the use of the "on-the-spot" photographs will help to solve about 50% of the these disputes. This is based on the well known experience, "a picture tells a thousand words".
With the increased popularity of mobilephone cameras, we are confident that more of our policyholders will use this new service.
Policyholders can send their accident photos via MMS to 91INCOME or email us at photo@income.com.sg.
They can also call our motor hotline at 67886616 if they have any queries.
Freddy Neo
Senior Manage, Claims
NTUC Income
This innovative approach helps the insurer to better handle iability dispute between the parties involved in the accident.
The policyholders are encouraged to use the mobilephone to take photographs of the damages to the vehicles immediately at the scene of the accident and to send them by MMS to NTUC Income. With the photographs as additional evidence, the assessment officers will be able to decide more accurately of the apportionment of liability between the parties.
This has proved to be effective. For 50% of these cases, the photographs showed that our policyhbolder was not at fault in the accident. For 40% of the cases, the photographs showed that our policyholder was less at fault compared to the other party.
The photographs help to strengthen the report of our policyholders, in the situation where both parties give different versions of the accidents and damages.
NTUC Income has to deal with about 200 cases of accidents each month, where both parties dispute the facts of the accident. Based on our experience, the use of the "on-the-spot" photographs will help to solve about 50% of the these disputes. This is based on the well known experience, "a picture tells a thousand words".
With the increased popularity of mobilephone cameras, we are confident that more of our policyholders will use this new service.
Policyholders can send their accident photos via MMS to 91INCOME or email us at photo@income.com.sg.
They can also call our motor hotline at 67886616 if they have any queries.
Freddy Neo
Senior Manage, Claims
NTUC Income
Friday, December 16, 2005
Policyholder is happy with our review
Dear Mr Tan,
I would like to thank you for reviewing my wife's case. I am pleased to know that you have a team and procedures in place to handle such genuine appeals.
I understand that being the largest insurer in Singapore, sometimes you do face contraints of all sorts. But this review process is necessary as it provides a very positive image as being the largest insurer in Singapore that DOES LISTEN even to small clients like us, regardless of outcome.
Thank you all and once again.
I would like to thank you for reviewing my wife's case. I am pleased to know that you have a team and procedures in place to handle such genuine appeals.
I understand that being the largest insurer in Singapore, sometimes you do face contraints of all sorts. But this review process is necessary as it provides a very positive image as being the largest insurer in Singapore that DOES LISTEN even to small clients like us, regardless of outcome.
Thank you all and once again.
Thursday, December 15, 2005
How can we serve our policyholders better in 2006?
How can we serve We asked our policyholhoders better in 2006? We asked them. Here is the reply from 174 policyholders:
1. What is your top priority for the next 12 months?
* Get a better return on your savings [ including CPF ] 61%
* Increase regular savings 39%
* Re-schedule loan to reduce interest or monthly repayment 12%
2. How do you like to achieve your goal?
* Learn financial planning from an educational website 42%
* Attend an educational seminar 27%
* See a financial adviser 20%
* See an insurance adviser 12%
3. What is your top wish from NTUC Income?
* Offer new products at a discount for existing policyholders 67%
* Organise educational seminars 27%
* Provide free financial planning advice 26%
* Improve customer service 21%
1. What is your top priority for the next 12 months?
* Get a better return on your savings [ including CPF ] 61%
* Increase regular savings 39%
* Re-schedule loan to reduce interest or monthly repayment 12%
2. How do you like to achieve your goal?
* Learn financial planning from an educational website 42%
* Attend an educational seminar 27%
* See a financial adviser 20%
* See an insurance adviser 12%
3. What is your top wish from NTUC Income?
* Offer new products at a discount for existing policyholders 67%
* Organise educational seminars 27%
* Provide free financial planning advice 26%
* Improve customer service 21%
Wednesday, December 14, 2005
Know Your Insurance
We invite you to visit this website and try one or more of the topics. You will be asked to give your feedback at the end of the topic. We hope that you find it to be interesting.
www.KnowYourInsurance.com.sg
www.KnowYourInsurance.com.sg
Saving for your child
Do you know the answes to these questions?
Visit www.KnowYourInsurance.com.sg
1. How much should a parent save for a child's education?
2. What happens if the saving is insufficient to fund the tertiary education?
3. Which type of investment is likely to give the best return on the savings?
4. Over a 15 year period, what is the difference between a low return (2% p.a.) and a high return (6% p.a.)?
5. What are the advantage of a flexible saving plan?
6. How can you reduce the risk of investment?
7. What type of rider provides adequate coverage at a low premium?
... and many more.
Visit www.KnowYourInsurance.com.sg
1. How much should a parent save for a child's education?
2. What happens if the saving is insufficient to fund the tertiary education?
3. Which type of investment is likely to give the best return on the savings?
4. Over a 15 year period, what is the difference between a low return (2% p.a.) and a high return (6% p.a.)?
5. What are the advantage of a flexible saving plan?
6. How can you reduce the risk of investment?
7. What type of rider provides adequate coverage at a low premium?
... and many more.
Tuesday, December 13, 2005
Is Incomeshield adequate?
You are the most open, frank and trusted CEO I hv known so far. Thank you in advance for allowing me to write directly to you.
Incomeshield advertised "Why buy expensive Shield plans when Incomeshield provides SUFFICIENT cover for B2,B1 and A class wards ?"
Q1. Does this means ALL inpatient sub-limits in Incomeshield plans A,B and C are sufficient to cover all types of operation bills in their respective wards ?
Reply: The sub-limits are sufficient for most types of hospital treatment. It may be insufficient for some major illness. But, I understand that most people are insured under a dread disease policy (life insurance policy), which will pay for these major illness.
Q2. If not, pls advise probability of one exceeding each sub-limits based on Incomeshield past claim records.
Reply: If you select the right ward in restructured hospital, the sub-limits should be sufficient for more than 90% of the cases.
Q3. When will Income offers a rider for "as charged basis, ie. without inpatient sub-limits" per Straits Times report dated 6 Jul 2005, page H21.
Reply: We have introduced a Plan P that offers higher coverage than plan A, and is suitable for private hospital. We are still working on the "as charged" rider, and have not decided on how to implement it.
Strongly believe Income will woo many undecided Shield holders to Incomeshield plans if answers to above questions are publish nationwide.
Incomeshield advertised "Why buy expensive Shield plans when Incomeshield provides SUFFICIENT cover for B2,B1 and A class wards ?"
Q1. Does this means ALL inpatient sub-limits in Incomeshield plans A,B and C are sufficient to cover all types of operation bills in their respective wards ?
Reply: The sub-limits are sufficient for most types of hospital treatment. It may be insufficient for some major illness. But, I understand that most people are insured under a dread disease policy (life insurance policy), which will pay for these major illness.
Q2. If not, pls advise probability of one exceeding each sub-limits based on Incomeshield past claim records.
Reply: If you select the right ward in restructured hospital, the sub-limits should be sufficient for more than 90% of the cases.
Q3. When will Income offers a rider for "as charged basis, ie. without inpatient sub-limits" per Straits Times report dated 6 Jul 2005, page H21.
Reply: We have introduced a Plan P that offers higher coverage than plan A, and is suitable for private hospital. We are still working on the "as charged" rider, and have not decided on how to implement it.
Strongly believe Income will woo many undecided Shield holders to Incomeshield plans if answers to above questions are publish nationwide.
More educational talks
FROM THE PUBLIC:
It is heartening to know that you always have the interests of policy holders at heart - hence the dialogue sessions on Annuity Plans. Can I know whether you are making any more presentations for those who cannot be accommodated in the two sessions organised?
MY REPLY:
We will be holding more dialogues sessions and educational talks on annuities and other insurance products. You can get a schedule of the talks at our website: www.income.coop
http://www.income.coop/seminar/
It is heartening to know that you always have the interests of policy holders at heart - hence the dialogue sessions on Annuity Plans. Can I know whether you are making any more presentations for those who cannot be accommodated in the two sessions organised?
MY REPLY:
We will be holding more dialogues sessions and educational talks on annuities and other insurance products. You can get a schedule of the talks at our website: www.income.coop
http://www.income.coop/seminar/
Ideal Plan is better than Unit Trusts
Two visitors posted in my blog - that is is better to invest in a unit trust with a term rider, instead of investing in a investment linked plan. They asked for my views.
Generally, they are correct. Many ILPs have high charges and take away 1 or 2 years of savings. They also have the front end and annual spread.
The Ideal plan from NTUC Income is different. It invest 100% of the regular savings from the first month (like a unit trust). The front end spread is 3.5% and the annual charge is less than 1%. A unit trust usually has a front end spread of 5% and an annual charge of up to 2%.
By investing in our Ideal plan, the investor may be able to get 5% to 10% more over a period of 10 years - from our lower charges. It is better than invest in our Ideal plan (and select our Combined Fund) that a unit trust.
Do attend our educational talk on the combined fund. The schedule of the talk is found at: www.income.coop/seminar/
Generally, they are correct. Many ILPs have high charges and take away 1 or 2 years of savings. They also have the front end and annual spread.
The Ideal plan from NTUC Income is different. It invest 100% of the regular savings from the first month (like a unit trust). The front end spread is 3.5% and the annual charge is less than 1%. A unit trust usually has a front end spread of 5% and an annual charge of up to 2%.
By investing in our Ideal plan, the investor may be able to get 5% to 10% more over a period of 10 years - from our lower charges. It is better than invest in our Ideal plan (and select our Combined Fund) that a unit trust.
Do attend our educational talk on the combined fund. The schedule of the talk is found at: www.income.coop/seminar/
Monday, December 12, 2005
Survey: Insurance needs of young parents
108 people aged 30-40 replied to our I-survey. 71% are married with children, and 29% are either married with no children or are singles. 90% are working, and 10% are either self-employed or are looking for a job.
84% said that a young parent set aside $100 to $200 a month as a separate saving for each child.
36% said that a yong parent should insure for 5 to 10 years of earnings; 36% choose 3 to 5 years; 28% choose 1 to 3 years. The average is 5 years.
50% prefer to pay an $1,000 yearly for a life insurance for $30,000 (with return on savings); 37% prefer to pay $150 yearly for term insurance (death and accident) for $100,000; 13% prefer to pay $100 for accident insurance of $200,000.
50% said that a young parent should save 5 to 10% of monthly income on insurance; 26%
will less than 5% and 23% will save 10 to 20%. The average is close to 10%.
78% will choose term assruance (to cover death from all cases) if the budget is limited; 24% will insure for hospital or accident only.
48% prefer to buy a simple, low cost insurance plan first, and do the financial plan later; 44% prefer to do the financial plan immediately.
68% prefer to learn about the basic facts of insurance on your own; 32% prefer to rely on the advice of an insurance agent.
63% prefer to invest in a flexible, long term saving plan that gives an attractive return; 28% prefer to save in a life insurance policy that has a fixed premium and benefit.
76% prefer to buy a separate contracts for protection and for savings; 24% prefer a bundled contract.
49% prefer to approach the insurer directly for a discount: 42% prefer to get a discount from the agent; 9% will buy without a discount (to help a friend to achieve the sales quota).
Period of Survey: 5 Dec - 12 Dec 2005
84% said that a young parent set aside $100 to $200 a month as a separate saving for each child.
36% said that a yong parent should insure for 5 to 10 years of earnings; 36% choose 3 to 5 years; 28% choose 1 to 3 years. The average is 5 years.
50% prefer to pay an $1,000 yearly for a life insurance for $30,000 (with return on savings); 37% prefer to pay $150 yearly for term insurance (death and accident) for $100,000; 13% prefer to pay $100 for accident insurance of $200,000.
50% said that a young parent should save 5 to 10% of monthly income on insurance; 26%
will less than 5% and 23% will save 10 to 20%. The average is close to 10%.
78% will choose term assruance (to cover death from all cases) if the budget is limited; 24% will insure for hospital or accident only.
48% prefer to buy a simple, low cost insurance plan first, and do the financial plan later; 44% prefer to do the financial plan immediately.
68% prefer to learn about the basic facts of insurance on your own; 32% prefer to rely on the advice of an insurance agent.
63% prefer to invest in a flexible, long term saving plan that gives an attractive return; 28% prefer to save in a life insurance policy that has a fixed premium and benefit.
76% prefer to buy a separate contracts for protection and for savings; 24% prefer a bundled contract.
49% prefer to approach the insurer directly for a discount: 42% prefer to get a discount from the agent; 9% will buy without a discount (to help a friend to achieve the sales quota).
Period of Survey: 5 Dec - 12 Dec 2005
Survey: Insurance needs of young people
146 young people aged 20-30 repled to our survey. 85% are employed. 15% are still studying or looking for a job.
85% said that young people need life or accident insurance, as accidents can happen.
97% said that young people should have insurance, even if they are not married, so that they can leave something for thier parents.
62% want to save $100 to $200 a month for insurance and savings, when they start work. 38% prefer to spend $10 to $20 a month for insurance protection (ie no saving).
85% said that a tertiary student should spend $10 to $20 a month to be insured, and leave something for the parents.
89% prefer a combination of hospital and accident coverage.
82% prefer to buy a simple, low cost insurance plan first, and make the financial plan later.
72% are willing to learn about the basic facts of insurance on your own at an educational website. 28% prefer to see an insurance adviser.
68% prefer to invest in a flexible, long term saving plan that gives an attractive return. 20% prefer to save in a life insurance policy with fixed premium and benefit. 12%
75% prefer an unbundled contract, with protection and saving purchased separately. 25% prefer a bundled contract.
48% prefer to buy insurance directly, if they can get a discount. 37% prefer to approach an insurance agent for a discount. 15% will help their friend to meet hte sales quota (ie no discount).
85% said that young people need life or accident insurance, as accidents can happen.
97% said that young people should have insurance, even if they are not married, so that they can leave something for thier parents.
62% want to save $100 to $200 a month for insurance and savings, when they start work. 38% prefer to spend $10 to $20 a month for insurance protection (ie no saving).
85% said that a tertiary student should spend $10 to $20 a month to be insured, and leave something for the parents.
89% prefer a combination of hospital and accident coverage.
82% prefer to buy a simple, low cost insurance plan first, and make the financial plan later.
72% are willing to learn about the basic facts of insurance on your own at an educational website. 28% prefer to see an insurance adviser.
68% prefer to invest in a flexible, long term saving plan that gives an attractive return. 20% prefer to save in a life insurance policy with fixed premium and benefit. 12%
75% prefer an unbundled contract, with protection and saving purchased separately. 25% prefer a bundled contract.
48% prefer to buy insurance directly, if they can get a discount. 37% prefer to approach an insurance agent for a discount. 15% will help their friend to meet hte sales quota (ie no discount).
Buy term assurance to protect your family
There was a story in the newspaper about a widow with young children. Her husband passed away, and left her with financial liabilities to settle. Later, she became an insurance adviser, and used her example to advocate that all families should be adequately protected.
I agree.
Here are some options for a person age 30 to secure an life insurance protection of $200,000:
- whole life policy $3,000 - $6,000 a year
- term assurance policy $800 (male) $560 (female) a year
- decreasing term assurance $320 (male), $240 (female)a year
When you meet your insurance adviser, you should ask for the three options. You can find that life insurance cover (especially with a decreasing term assurance) can be quite affordable.
IF you can afford to save more, you can consider a whole life policy - which gives you a cash value.
More people now opt to buy a decreasing term assurance and invest the difference in an investment-linked fund.
Make the right choice. Learn about insurance through this educational website:
www.KnowYourInsurance.com.sg
I agree.
Here are some options for a person age 30 to secure an life insurance protection of $200,000:
- whole life policy $3,000 - $6,000 a year
- term assurance policy $800 (male) $560 (female) a year
- decreasing term assurance $320 (male), $240 (female)a year
When you meet your insurance adviser, you should ask for the three options. You can find that life insurance cover (especially with a decreasing term assurance) can be quite affordable.
IF you can afford to save more, you can consider a whole life policy - which gives you a cash value.
More people now opt to buy a decreasing term assurance and invest the difference in an investment-linked fund.
Make the right choice. Learn about insurance through this educational website:
www.KnowYourInsurance.com.sg
Sunday, December 11, 2005
Q&A on medical insurance
1. I am currently insured under MediShield and my company's medical insurance. Do I need to purchase additional insurance? If there is a claim, would I be able to claim under all three?
Reply: If you are covered under several medical insurance plans, you can decide on which plans to make your claim. However, the total amount that you can claim should not exceed the actual amount that you have paid. You are not allowed to make a profit by going to hospital.
Generally, if your company already cover you for medical benefits, you do not need to buy another other insurance plan.
However, many people still take Medishield (or Incomeshield) for the following reasons:
- to cover any excess payment that is not covered by the company's plan
- to have continuity of coverage if they leave their existing company.
As the premium for Medishield or Incomeshield is quite low, this approach is quite sensible.
2. Now that MediShield has been privatised, how will it affect my MediShield plan? Would I have to pay higher premiums?
Reply: The Basic Medishield plan remains with CPF board. Those who were covered for Medishield Plus have now been taken over by NTUC Income. We have renamed the scheme to Incomeshield M plans with benefits being enhanced and premiums lowered.
We will offer an option for these policyholders to move from the Incomeshield MA or MB plans to our more popular A or B plans. They will be contacted separately.
3. I went for a surgery recently and found out that my comprehensive medical insurance plan did not cover the X-rays. Why does it not cover the X-rays, which I would think as an essential part of the medical treatment?
Reply: Different insurers offer medical insurance plans with differing terms and conditions. Under Incomeshield plans, we cover x-ray expenses as part of the Room & Board charges.
4. I have elderly parents in their 70s who are in poor health. I am worried that my savings will be wiped out if both should fall in at the same time. What kind of medical insurance can I buy for them?
Reply: All medical insurance plans are underwritten based on latest health conditions. You can discuss with your insurance advisor before deciding on the best insurance plans for them.
If your parent are not insured, you can send them for treatment in Class C ward at government or restructured hospitals. There is a higher government subsidy for these wards. The cost is quite affordable, and the standard of care is quite good.
Many elderly people do not mind being treated in Class C ward, as they do not wish to incur a heavy medical bill.
5. What is "as charged plan" as compared to Incomeshield plan? Does Income offer an alternative to "as charged plan"?
Reply: The "as charged plan" pays the entire bill, but is still subject to the deductible and co-insurance of 10%. The premium is much higher than a similar plan with sub-limits for certain items.
If you go to a re-structured hospital, the bill will be within the sub-limits. There is no need to pay more for a "as charged" plan.
Incomeshield P plan allows insured to go to a private hospital. The benefit limits are 50% to 100% higher than Incomeshield Plan A and would be adequate for majority of private hospital bills.
6. Why should I purchase medical insurance from a cooperative and not a private insurer?
Reply: As NTUC Income is a co-operative, we do not aim to increase profit for shareholders. We actively manage claims to avoid escalation of cost. This allows us to keep the premium rates as low as possible.
Most private insurers aim to make a profit on their medical insurance. They will increase their premium rates to maintain their margin and generate profit for their shareholders. It is better to insure with a cooperative that aims to take care of its policyholders.
Reply: If you are covered under several medical insurance plans, you can decide on which plans to make your claim. However, the total amount that you can claim should not exceed the actual amount that you have paid. You are not allowed to make a profit by going to hospital.
Generally, if your company already cover you for medical benefits, you do not need to buy another other insurance plan.
However, many people still take Medishield (or Incomeshield) for the following reasons:
- to cover any excess payment that is not covered by the company's plan
- to have continuity of coverage if they leave their existing company.
As the premium for Medishield or Incomeshield is quite low, this approach is quite sensible.
2. Now that MediShield has been privatised, how will it affect my MediShield plan? Would I have to pay higher premiums?
Reply: The Basic Medishield plan remains with CPF board. Those who were covered for Medishield Plus have now been taken over by NTUC Income. We have renamed the scheme to Incomeshield M plans with benefits being enhanced and premiums lowered.
We will offer an option for these policyholders to move from the Incomeshield MA or MB plans to our more popular A or B plans. They will be contacted separately.
3. I went for a surgery recently and found out that my comprehensive medical insurance plan did not cover the X-rays. Why does it not cover the X-rays, which I would think as an essential part of the medical treatment?
Reply: Different insurers offer medical insurance plans with differing terms and conditions. Under Incomeshield plans, we cover x-ray expenses as part of the Room & Board charges.
4. I have elderly parents in their 70s who are in poor health. I am worried that my savings will be wiped out if both should fall in at the same time. What kind of medical insurance can I buy for them?
Reply: All medical insurance plans are underwritten based on latest health conditions. You can discuss with your insurance advisor before deciding on the best insurance plans for them.
If your parent are not insured, you can send them for treatment in Class C ward at government or restructured hospitals. There is a higher government subsidy for these wards. The cost is quite affordable, and the standard of care is quite good.
Many elderly people do not mind being treated in Class C ward, as they do not wish to incur a heavy medical bill.
5. What is "as charged plan" as compared to Incomeshield plan? Does Income offer an alternative to "as charged plan"?
Reply: The "as charged plan" pays the entire bill, but is still subject to the deductible and co-insurance of 10%. The premium is much higher than a similar plan with sub-limits for certain items.
If you go to a re-structured hospital, the bill will be within the sub-limits. There is no need to pay more for a "as charged" plan.
Incomeshield P plan allows insured to go to a private hospital. The benefit limits are 50% to 100% higher than Incomeshield Plan A and would be adequate for majority of private hospital bills.
6. Why should I purchase medical insurance from a cooperative and not a private insurer?
Reply: As NTUC Income is a co-operative, we do not aim to increase profit for shareholders. We actively manage claims to avoid escalation of cost. This allows us to keep the premium rates as low as possible.
Most private insurers aim to make a profit on their medical insurance. They will increase their premium rates to maintain their margin and generate profit for their shareholders. It is better to insure with a cooperative that aims to take care of its policyholders.
Saturday, December 10, 2005
Buy Term Assurance
You can get a large life insurance cover, for a very low premium.
If you buy the term as part of an ILP, your policy will not lapse as the cash value from the ILP will pay the premium.
The premium for the term assurance can be kept level. For example, you can insure for $100,000 at age 30 for an annual premium of only $400 (male) or $280 (female). This is a level premium payable for 35 years. It does not increase with age.
You save 60% of the premium by selecting a decreasing term assurance (DTA), where the sum assured reduces gradually over the term. At age 30, the annual premium to cover a DTA of $100,000 for 35 years is only $157 (male) or $113 (female).
Many people need a larger amount of insurance when they are young. Their insurance need can reduce when they grow older, as they have accumulated savings.
Term assurance pays for death and permanent disability arising from all causes, i.e. accident, illness, etc. It provides wider coverage compared to accident insurance.
If you buy the term as part of an ILP, your policy will not lapse as the cash value from the ILP will pay the premium.
The premium for the term assurance can be kept level. For example, you can insure for $100,000 at age 30 for an annual premium of only $400 (male) or $280 (female). This is a level premium payable for 35 years. It does not increase with age.
You save 60% of the premium by selecting a decreasing term assurance (DTA), where the sum assured reduces gradually over the term. At age 30, the annual premium to cover a DTA of $100,000 for 35 years is only $157 (male) or $113 (female).
Many people need a larger amount of insurance when they are young. Their insurance need can reduce when they grow older, as they have accumulated savings.
Term assurance pays for death and permanent disability arising from all causes, i.e. accident, illness, etc. It provides wider coverage compared to accident insurance.
Crazy Horse Cabaret in Singapore
I POSTED THIS VIEW IN JUNE 2005. I THINK THAT MY POINT IS STILL RELEVANT.
------------------------------------
4 June 2005
So far, there is not much attention about the proposal to bring this cabaret to Singapore. But, I expect things to hot up later in the year. We can expect some Singaporeans to speak gainst this erotic show.
Some Singaporeans have a tendency to blow things out of proportion.
Look back 15 year. When the R(A) show was allowed in Singapore, there was a lot of discussion and hot air. Now, this matter is forgotten. It did not cause much harm anyway.
I think that history will repeat itself.
------------------------------------
4 June 2005
So far, there is not much attention about the proposal to bring this cabaret to Singapore. But, I expect things to hot up later in the year. We can expect some Singaporeans to speak gainst this erotic show.
Some Singaporeans have a tendency to blow things out of proportion.
Look back 15 year. When the R(A) show was allowed in Singapore, there was a lot of discussion and hot air. Now, this matter is forgotten. It did not cause much harm anyway.
I think that history will repeat itself.
Friday, December 09, 2005
Handphone of accident can help
8 December 2005
Editor
New Paper
I refer to the letter, "How do we deal with drivers who lie?" by Mr Goh Ann Long (The New Paper, 7 December).
Mr Goh wanted to know how insurers deal with drivers who lie in their accident reports.
As NTUC Income insures about 40 per cent of all motor vehicles in Singapore, I wish to share our experience in dealing with such cases.
Each month, we handle about 2 000 cases of motor accident claims. About 10 per cent of these accidents are disputed by the parties, who give conflicting versions of the accident.
Our liability assessment officer interviews the parties, conducts a site visit if neccessary, and examines the photographs of the
damaged of the vehicle.
The officer is usually able to come to a decision on the appropriate apportionment of the liability. We try to be fair in our assessment and do not wish to favour any side.
If any of the parties disagrees with our assessment, they can ask for an independent expert to review the case or take the case to court.
The disputes can be minimised if both parties to the accident agree to sign the Singapore Accident Statement (SAS) on the spot.
We have recently implemented the use of MMS technology. Motorists are encouraged to use their handphones to take photos of the damage and send them to us by MMS at 9696 3399 or to photo@income.com.sg by e-mail.
The MMS project started two weeks ago.
We hope to solve 50 per cent of the disputed cases using this new approach. Claimants can call our 24-hour hotline at 6788 6616.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Editor
New Paper
I refer to the letter, "How do we deal with drivers who lie?" by Mr Goh Ann Long (The New Paper, 7 December).
Mr Goh wanted to know how insurers deal with drivers who lie in their accident reports.
As NTUC Income insures about 40 per cent of all motor vehicles in Singapore, I wish to share our experience in dealing with such cases.
Each month, we handle about 2 000 cases of motor accident claims. About 10 per cent of these accidents are disputed by the parties, who give conflicting versions of the accident.
Our liability assessment officer interviews the parties, conducts a site visit if neccessary, and examines the photographs of the
damaged of the vehicle.
The officer is usually able to come to a decision on the appropriate apportionment of the liability. We try to be fair in our assessment and do not wish to favour any side.
If any of the parties disagrees with our assessment, they can ask for an independent expert to review the case or take the case to court.
The disputes can be minimised if both parties to the accident agree to sign the Singapore Accident Statement (SAS) on the spot.
We have recently implemented the use of MMS technology. Motorists are encouraged to use their handphones to take photos of the damage and send them to us by MMS at 9696 3399 or to photo@income.com.sg by e-mail.
The MMS project started two weeks ago.
We hope to solve 50 per cent of the disputed cases using this new approach. Claimants can call our 24-hour hotline at 6788 6616.
Tan Kin Lian
Chief Executive Officer
NTUC Income
New Paper: Electrician bullied me
9 December 2005
Editor
The New Paper
I refer to the letter by Ms Lynn Aw entitled, "Electrician bullied me" (TNP, 08 Dec 2005).
Ms Aw shared her unfortunate experience with an electrician engaged by her to fix her faulty toilet light. She found the contractor through an advertisement in the newspaper.
NTUC Income provides an alternative way for home-owners to engage a contractor. They can call our 24-hour Home Service hotline, 6788 8878. We serve our policyholders and members of the public.
Under our Home Service portal, we register reliable contractors who can provide a wide range of 40 different types of services. The most popular services are plumbing, electrical, refrigeration, air-conditioning and tuition.
We check that the registered contactors are licensed and have undergone the required training for the service that they have provided. They are also required to commit to deliver deliver quality and professional service at a reasonable price, and to provide a 90-day warranty on the work.
If the customer finds the service to be unsatisfactory, they can lodge a complaint to us. We will investigate the complaint and find a solution. The complaint rate is low, representing less than 1% of the cases handled through our portal. Most of these complaint are resolved at the first level.
We handle an aveage of 150 calls a day for various servics through our portal. More information can be found at our website: www.income.coop/homeservices or by calling 6788 8878.
Tan Soon Heng
General Manager
NTUC Income
Editor
The New Paper
I refer to the letter by Ms Lynn Aw entitled, "Electrician bullied me" (TNP, 08 Dec 2005).
Ms Aw shared her unfortunate experience with an electrician engaged by her to fix her faulty toilet light. She found the contractor through an advertisement in the newspaper.
NTUC Income provides an alternative way for home-owners to engage a contractor. They can call our 24-hour Home Service hotline, 6788 8878. We serve our policyholders and members of the public.
Under our Home Service portal, we register reliable contractors who can provide a wide range of 40 different types of services. The most popular services are plumbing, electrical, refrigeration, air-conditioning and tuition.
We check that the registered contactors are licensed and have undergone the required training for the service that they have provided. They are also required to commit to deliver deliver quality and professional service at a reasonable price, and to provide a 90-day warranty on the work.
If the customer finds the service to be unsatisfactory, they can lodge a complaint to us. We will investigate the complaint and find a solution. The complaint rate is low, representing less than 1% of the cases handled through our portal. Most of these complaint are resolved at the first level.
We handle an aveage of 150 calls a day for various servics through our portal. More information can be found at our website: www.income.coop/homeservices or by calling 6788 8878.
Tan Soon Heng
General Manager
NTUC Income
Thursday, December 08, 2005
Q&A: Financial Planning for the Young
Question: Should young adults think about financial planning, when their earning is still low?
Yes. Each person should save at least 10% of their earnings. This is very important, as jobs are uncertain. They may also need their saving to meet an unexpected payment, including a large medical bill, or when they lose their job.
Question: How should they invest their saving?
They should invest in a flexible saving plan that can give an attractive rate of return over several years. An investment-linked plan from NTUC Income is probably the best. It is more appropriate than a bank account or a traditional life insurance plan.
Question: Does this plan have high charges?
Most investment-linked plans have high charges. But you can choose a plan that invest 100% of your monthly savings immediately, and incur low charges.
Question: Does this plan provide insurance protection?
It is better for you to buy a decreasing term assurance. It provides high coverage at a low premium that remains fixed during the term.
Yes. Each person should save at least 10% of their earnings. This is very important, as jobs are uncertain. They may also need their saving to meet an unexpected payment, including a large medical bill, or when they lose their job.
Question: How should they invest their saving?
They should invest in a flexible saving plan that can give an attractive rate of return over several years. An investment-linked plan from NTUC Income is probably the best. It is more appropriate than a bank account or a traditional life insurance plan.
Question: Does this plan have high charges?
Most investment-linked plans have high charges. But you can choose a plan that invest 100% of your monthly savings immediately, and incur low charges.
Question: Does this plan provide insurance protection?
It is better for you to buy a decreasing term assurance. It provides high coverage at a low premium that remains fixed during the term.
Q&A: How to select an investment fund
Question: There are many funds in the market. What are the main categories of funds?
You can choose an equity fund, a bond fund or a balanced fund, which invest in both asset types.
Over the past 10 years, a global equity fund earn an average of 10% per annum. The bond fund earn an average of 5% per annum. These averages are also reflective of the returns over a longer period.
Question: Is it risky to invest in equities?
Equities have higher risk than bonds. But the risk can be reduced through diversification. You should invest in a fund that invest in many equities. If any investment turns bad, the impact on the fund is small, and can be offset by the good investments.
If you invest for the long term, you are also able to diversify through the years. Your fund may perform well in some years and poorly in other years. But, over a long period, it is likely to give you a fairly attractive return.
Question: Is there a guarantee on my capital?
If you wish to have a guarantee, you should invest in government bonds that has the highest rating. However, the return is quite low at around 3% p.a. for 5 years.
It is better to invest in an large, well diversified fund that can give a better return, with minimal risk, over a longer period.
Question: Am I committed to invest for a fixed number of years?
You have the flexibility to choose the right time to realise your investments. If you choose a good time, you can turn risk to your advantage and realise a better return than average.
You are also allowed to realise your investment, if you need cash for other purpose without suffering any penalty (except for the termination charge in some case). You get the net asset value fo the fund.
Question: Do I have to incur high charges?
You have to check the initial, annual and termination charges on the fund. Some fund have low charges, and give a better return to the investor.
You can choose an equity fund, a bond fund or a balanced fund, which invest in both asset types.
Over the past 10 years, a global equity fund earn an average of 10% per annum. The bond fund earn an average of 5% per annum. These averages are also reflective of the returns over a longer period.
Question: Is it risky to invest in equities?
Equities have higher risk than bonds. But the risk can be reduced through diversification. You should invest in a fund that invest in many equities. If any investment turns bad, the impact on the fund is small, and can be offset by the good investments.
If you invest for the long term, you are also able to diversify through the years. Your fund may perform well in some years and poorly in other years. But, over a long period, it is likely to give you a fairly attractive return.
Question: Is there a guarantee on my capital?
If you wish to have a guarantee, you should invest in government bonds that has the highest rating. However, the return is quite low at around 3% p.a. for 5 years.
It is better to invest in an large, well diversified fund that can give a better return, with minimal risk, over a longer period.
Question: Am I committed to invest for a fixed number of years?
You have the flexibility to choose the right time to realise your investments. If you choose a good time, you can turn risk to your advantage and realise a better return than average.
You are also allowed to realise your investment, if you need cash for other purpose without suffering any penalty (except for the termination charge in some case). You get the net asset value fo the fund.
Question: Do I have to incur high charges?
You have to check the initial, annual and termination charges on the fund. Some fund have low charges, and give a better return to the investor.
No claim discount for health insurance
SUGGESTION FROM POLICYHOLDER:
I hope one day NTUC will also offer NCD for all its health products (there
is one in the industry that offers up to 30% NCD at this moment), which will
reward those people that maintain their good health. This is for sharing
only...
-------------------------------
MY REPLY:
We now offer 10% discount under Incomeshield if there is no claim for 3 years. We hope to be able to maintain this discount in the future, provided that our claim experience remain favourable.
I want you to know why the scale of NCD for motor insurance is different from health insurance.
In motor insurance, we have a claim rate of 20%. In Incomeshield, the claim rate is about 5%.
Due to the difference in claim rate, the NCD has to be reflected differently. Generally, if the claim rate is higher, it is possible to justify a higher rate of NCD to different between the good risk and the poor risk.
I hope one day NTUC will also offer NCD for all its health products (there
is one in the industry that offers up to 30% NCD at this moment), which will
reward those people that maintain their good health. This is for sharing
only...
-------------------------------
MY REPLY:
We now offer 10% discount under Incomeshield if there is no claim for 3 years. We hope to be able to maintain this discount in the future, provided that our claim experience remain favourable.
I want you to know why the scale of NCD for motor insurance is different from health insurance.
In motor insurance, we have a claim rate of 20%. In Incomeshield, the claim rate is about 5%.
Due to the difference in claim rate, the NCD has to be reflected differently. Generally, if the claim rate is higher, it is possible to justify a higher rate of NCD to different between the good risk and the poor risk.
Positive feedback from our policyholder
FEEDBACK FROM POLICYHOLDER TO OUR ADVISER:
Dear
We am very fortunate and privilege to know you. You have been providing an excellent and effective services over almost a decade. You understand your products and can communicate effectively. This had helped me to make my choice as I compare with your competition.
NTUC Income's vehicle insurance differential itself from the competition with NCD waiver for car insurance as an example.
I learned from this experience that the upper management in NTUC Income are extremely active and effective to resolve matters.. and it is a rare find.
I must also add that your customer service folks are also great in processing my car insurance renewal with Income, ahead of the usual due date to accommodate for my absence in Singapore in Dec, as I had mentioned in my earlier email.
Congratulation on your success and attainment of LIFE MEMBERSHIP for MDRT. May I you have an enjoyable congress in San Diego. If you got time, visit the Sea World and Wild Animal Park...
Dear
We am very fortunate and privilege to know you. You have been providing an excellent and effective services over almost a decade. You understand your products and can communicate effectively. This had helped me to make my choice as I compare with your competition.
NTUC Income's vehicle insurance differential itself from the competition with NCD waiver for car insurance as an example.
I learned from this experience that the upper management in NTUC Income are extremely active and effective to resolve matters.. and it is a rare find.
I must also add that your customer service folks are also great in processing my car insurance renewal with Income, ahead of the usual due date to accommodate for my absence in Singapore in Dec, as I had mentioned in my earlier email.
Congratulation on your success and attainment of LIFE MEMBERSHIP for MDRT. May I you have an enjoyable congress in San Diego. If you got time, visit the Sea World and Wild Animal Park...
Wednesday, December 07, 2005
Tips for motorists
Tips for motorists
1. Motor insurance.
Shop around for your insurance. You can save up to
$200 a year, if you buy from the right place.
Call 6477 7722 for a quote. We insure about 40% of all vehicles,
due to our competitive rates and good service.
2. Accident
Use your mobilephone or camera to take photos of the
damages. It helps to identify the party at fault and prevent
the other party from inflating the damages.
Send your vehicle to an assessment center (Idac)
immediately. Let your insurer handle the repair. You
enjoy expert and hassle free service.
Call 6788 6616 for assistance (if you are insured
with NTUC Incoem).
3. No Claim Discount
If the damages are slight, make a private settlement, i.e.
pay cash for the damage. You can protect your discount
and enjoy savings over the next few years.
If you are not at fault, your insurer will help you to make
the claim against the other party and allow you to keep
the discount.
1. Motor insurance.
Shop around for your insurance. You can save up to
$200 a year, if you buy from the right place.
Call 6477 7722 for a quote. We insure about 40% of all vehicles,
due to our competitive rates and good service.
2. Accident
Use your mobilephone or camera to take photos of the
damages. It helps to identify the party at fault and prevent
the other party from inflating the damages.
Send your vehicle to an assessment center (Idac)
immediately. Let your insurer handle the repair. You
enjoy expert and hassle free service.
Call 6788 6616 for assistance (if you are insured
with NTUC Incoem).
3. No Claim Discount
If the damages are slight, make a private settlement, i.e.
pay cash for the damage. You can protect your discount
and enjoy savings over the next few years.
If you are not at fault, your insurer will help you to make
the claim against the other party and allow you to keep
the discount.
Website: Know Your Insurance
This website aims to:
- educate people about investment and insurance
- help them to make the right choice
- offers a discount when they decide to buy direct.
Try it: www.KnowYourInsurance.com.sg
IT IS NOW READY FOR ACCESS!
- educate people about investment and insurance
- help them to make the right choice
- offers a discount when they decide to buy direct.
Try it: www.KnowYourInsurance.com.sg
IT IS NOW READY FOR ACCESS!
Monday, December 05, 2005
Educational Talks
NTUC Income organises educational talks about insurance and investments.
We aim to educate consumers, so that they can make the right choice.
The talks are free, but you have to register your attendance at our website: www.income.coop/talks or call 6877 3366.
You will see a list of talks scheduled for the next few weeks, ie title of talk, date, time, venue.
An attractive offer will be given at each educational talk. You can benefit by attending. Several of the talks are given by our chief executive officer or senior managers.
We aim to educate consumers, so that they can make the right choice.
The talks are free, but you have to register your attendance at our website: www.income.coop/talks or call 6877 3366.
You will see a list of talks scheduled for the next few weeks, ie title of talk, date, time, venue.
An attractive offer will be given at each educational talk. You can benefit by attending. Several of the talks are given by our chief executive officer or senior managers.
Compliment on good service
MESSAGE FROM a policyholder
Hi Mr. Tan Kin Lian (CEO of NTUC),
I have read the numerous response/letters in the ST Forum coming from NTUC. It is rare that a CEO of an organization respond to public queries. You have always make it a point to ensure that the public queries are answered.
Below is a chain of e-mail that reflects how quick and responsive your folks reply to a customer request, even though the customer (me) has indicated that 15th Dec is still alright.
It is something that you should know, that the good effort of your folks is being
recognized.
If they went out of the normal procedure to assist the customer, I hope that they are not being reprimanded.
The intent of this letter is a feedback to you form a satisfied customer and a way that the NTUC staff be recognized for the good service.
The feedback phone call which normally comes few days after the service request has been made, showed the effort an organization is willing to put in, to improve its service.
Thank you for having such a team of people. The time taken to write this letter is deserving. I do hope to hear from your good self, so I know that the letter has reached you.
Hi Mr. Tan Kin Lian (CEO of NTUC),
I have read the numerous response/letters in the ST Forum coming from NTUC. It is rare that a CEO of an organization respond to public queries. You have always make it a point to ensure that the public queries are answered.
Below is a chain of e-mail that reflects how quick and responsive your folks reply to a customer request, even though the customer (me) has indicated that 15th Dec is still alright.
It is something that you should know, that the good effort of your folks is being
recognized.
If they went out of the normal procedure to assist the customer, I hope that they are not being reprimanded.
The intent of this letter is a feedback to you form a satisfied customer and a way that the NTUC staff be recognized for the good service.
The feedback phone call which normally comes few days after the service request has been made, showed the effort an organization is willing to put in, to improve its service.
Thank you for having such a team of people. The time taken to write this letter is deserving. I do hope to hear from your good self, so I know that the letter has reached you.
Offer of refund to annuitants
5 December 2005
Editor
Forum Page
Straits Times
I wish to respond to two recent stories in the Straits Times about the buyback offer offered by NTUC Income to 12,000 purchasers who bought their annuities prior to 2002 (? November and 3 December).
Both stories indicate that the refund offer is not attractive as the deal that they are getting now. This is correct.
The interest rate of 4.5 percent that is used to compute the refund is based on the actual yield earned by our investments during the past 10 years. This is lower than the guaranteed return of 5 per cent that was used to compute the annuity payments.
A small number from this group of annuitants were unhappy that they did not get any bonus for the past three years. We decided to make this refund offer, so that they can find a better way to invest their money.
Less than 10 people took up the offer of the refund. The majority decide to stay with their current annuity plan. For others who need a longer time to decide, our offer is still available for them for a few more weeks.
We sent an explanatory note to our 28,000 annuitants to explain our practice in declaring bonus. This supplements the communication that was sent in past years.
During the past two weeks, we also held two dialogue sessions that were attended by 600 people. The sessions went on well. Several annuitants were interested to top up their annuity.
NTUC Income is a cooperative society. We collect the annuity money and invest them into an annuity fund. We invest the fund prudently to earn an attractive long term return. We use the surplus of the annuity fund to declare bonuses to our annuitants. We exercise fairness in declaring the bonus to the different series of annuitants who have bought their annuities on different guaranteed terms.
We will continue to hold dialogue sessions in the future. We invite the public to attend these sessions and learn more about the principle of pooling is applied to help annuitants to manage their risks. We want to educate retirees about the advantages of investing in annuities.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Editor
Forum Page
Straits Times
I wish to respond to two recent stories in the Straits Times about the buyback offer offered by NTUC Income to 12,000 purchasers who bought their annuities prior to 2002 (? November and 3 December).
Both stories indicate that the refund offer is not attractive as the deal that they are getting now. This is correct.
The interest rate of 4.5 percent that is used to compute the refund is based on the actual yield earned by our investments during the past 10 years. This is lower than the guaranteed return of 5 per cent that was used to compute the annuity payments.
A small number from this group of annuitants were unhappy that they did not get any bonus for the past three years. We decided to make this refund offer, so that they can find a better way to invest their money.
Less than 10 people took up the offer of the refund. The majority decide to stay with their current annuity plan. For others who need a longer time to decide, our offer is still available for them for a few more weeks.
We sent an explanatory note to our 28,000 annuitants to explain our practice in declaring bonus. This supplements the communication that was sent in past years.
During the past two weeks, we also held two dialogue sessions that were attended by 600 people. The sessions went on well. Several annuitants were interested to top up their annuity.
NTUC Income is a cooperative society. We collect the annuity money and invest them into an annuity fund. We invest the fund prudently to earn an attractive long term return. We use the surplus of the annuity fund to declare bonuses to our annuitants. We exercise fairness in declaring the bonus to the different series of annuitants who have bought their annuities on different guaranteed terms.
We will continue to hold dialogue sessions in the future. We invite the public to attend these sessions and learn more about the principle of pooling is applied to help annuitants to manage their risks. We want to educate retirees about the advantages of investing in annuities.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Reply to Chia Yoong Song on Incomeshield M
4 December 2005
Editor
Forum Page
Straits Times
I refer to the article "Host of errors in policy documents Incomeshield Plans MA, MB" by Chia Yoong Song (Straits Times, 3 December).
Mr Chia insured his wife under our Incomeshield Plan A. He and his two children were insured under Medishield Plus, which was recently converted to our Incomeshield Plan MA.
When we selected his wife's record to print the renewal notice in November, we accidentally linked it to Mr Chia's policy number under the Medishield Plus. This resulted in a printing error and caused the duplicated printing. When we spotted the error, we sent a new set of renewal notice fo his wife, to supercede the renewal notice.
We apologise for the error and inconvenience caused to Mr Chia. This error has now been rectified.
On a positive note, we now have a large base of 800,000 policyholders under our Incomeshield plan. With the economy of scale, we will be able to improve our insurance plans over time. Our aim is to provide adequate coverage for a lifetime and keep the premium at an affordable cost for our policyholders.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Editor
Forum Page
Straits Times
I refer to the article "Host of errors in policy documents Incomeshield Plans MA, MB" by Chia Yoong Song (Straits Times, 3 December).
Mr Chia insured his wife under our Incomeshield Plan A. He and his two children were insured under Medishield Plus, which was recently converted to our Incomeshield Plan MA.
When we selected his wife's record to print the renewal notice in November, we accidentally linked it to Mr Chia's policy number under the Medishield Plus. This resulted in a printing error and caused the duplicated printing. When we spotted the error, we sent a new set of renewal notice fo his wife, to supercede the renewal notice.
We apologise for the error and inconvenience caused to Mr Chia. This error has now been rectified.
On a positive note, we now have a large base of 800,000 policyholders under our Incomeshield plan. With the economy of scale, we will be able to improve our insurance plans over time. Our aim is to provide adequate coverage for a lifetime and keep the premium at an affordable cost for our policyholders.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Policyholder have second thoughts about going to distributor workshop
I RECIEVED THIS MESSAGE FROM A POLICYHOLDER (IT HAS BEEN EDITED BY ME)
Dear Tan,
Your blog is extremely educational. I discovered it by accident following a search for your full name.
Like many people, I did not know earlier that there can be a significant difference between a distributor's cost of repair versus your authorised workshop.
After reading your blog, I have now become aware that it can make sense to get value for money by repairing at normal workshop, especially if the distributor is also sub-contracting work out.
I have reconsider my plan to go to my distributor workshop for the spraying. I will go to a normal workshop.
Thanks for every thing. Most importantly, the education that you have provided to the general public. I know I can trust your views.
Dear Tan,
Your blog is extremely educational. I discovered it by accident following a search for your full name.
Like many people, I did not know earlier that there can be a significant difference between a distributor's cost of repair versus your authorised workshop.
After reading your blog, I have now become aware that it can make sense to get value for money by repairing at normal workshop, especially if the distributor is also sub-contracting work out.
I have reconsider my plan to go to my distributor workshop for the spraying. I will go to a normal workshop.
Thanks for every thing. Most importantly, the education that you have provided to the general public. I know I can trust your views.
Financial Planning: Tips for the Young
1. Save up to 15% of your monthly income. You may need you savings for an emergency or when you lose your job. Invest the savings in a flexible insurance plan that gives an attractive return.
2. Buy a low cost insurance plan that offers up to $100,000 in coverage against death, accident and hospital expenses for only $100 a year. Accidents can happen and you should be protected.
3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: www.KnowYourInsurance.com.sg or attend an educational talk (call: 6877 3366).
CONTEST
Visit this website: www.income.coop to participate in this contest and win prizes of $5,000.Eligible only for people between 20 to 30 years old. (Note: this will only be available from 15 Dec 2005).
2. Buy a low cost insurance plan that offers up to $100,000 in coverage against death, accident and hospital expenses for only $100 a year. Accidents can happen and you should be protected.
3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: www.KnowYourInsurance.com.sg or attend an educational talk (call: 6877 3366).
CONTEST
Visit this website: www.income.coop to participate in this contest and win prizes of $5,000.Eligible only for people between 20 to 30 years old. (Note: this will only be available from 15 Dec 2005).
Financial Planning: Tips for Young Parents
1. Save up to $200 monthly for your child. Invest the savings in a flexible insurance plan that gives an attractive return. The savings can be used for your tertiary education or give your child a head start in life.
2. Choose a plan that gives you an attractive return and invest 100% of your savings from the first month. Protect your savings with a decreasing term assurance that charges a very low premium, and allow more of your savings to accumulate.
3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: www.KnowYourInsurance.com.sg or attend an educational talk (call: 6877 3366).
CONTEST
Visit this website: www.income.coop to participate in this contest and win prizes of $5,000. Eligible only for people expecting a child or with a child less than 2 years old. (Note: this will only be available from 15 Dec 2005).
2. Choose a plan that gives you an attractive return and invest 100% of your savings from the first month. Protect your savings with a decreasing term assurance that charges a very low premium, and allow more of your savings to accumulate.
3. Learn the basic facts about investments and insurance on your own. You can make the right choice and earn a better return for your savings. Visit this website: www.KnowYourInsurance.com.sg or attend an educational talk (call: 6877 3366).
CONTEST
Visit this website: www.income.coop to participate in this contest and win prizes of $5,000. Eligible only for people expecting a child or with a child less than 2 years old. (Note: this will only be available from 15 Dec 2005).
My personal views on the Melvyn Tan's eposide
Melvyn Tan is a world renowned pianist. He is a Singaprean.
When Melvyn was young, he went overseas to study. He did not return to perform his national service. His parents paid a bond of $30,000. It was a large sum of money at that time.
Many many years later, Melvyn Tan achieved world fame. He agreed to return to Singapore to perform at the Esplanade, Theatre by the Bay.
He voluntarily attended court to face the charge of failing to do his national service. He was fined $3,000.
Some Singaporeans were still not happy. They wrote strong letters to the newspapers. There was an uproar.
Finally, Melvyn Tan decided to cancel his performance at the Esplanade.
I like to ask the following questions:
- what have we achieved as a result of this uproar?
- how may times should a person be penalised for an offence?
- was the penalty of $30,000 on the bond sufficient?
- can we be a more forgiving people?
- do we want Melvyn to stay away from Singapore for a lifetime?
When Melvyn was young, he went overseas to study. He did not return to perform his national service. His parents paid a bond of $30,000. It was a large sum of money at that time.
Many many years later, Melvyn Tan achieved world fame. He agreed to return to Singapore to perform at the Esplanade, Theatre by the Bay.
He voluntarily attended court to face the charge of failing to do his national service. He was fined $3,000.
Some Singaporeans were still not happy. They wrote strong letters to the newspapers. There was an uproar.
Finally, Melvyn Tan decided to cancel his performance at the Esplanade.
I like to ask the following questions:
- what have we achieved as a result of this uproar?
- how may times should a person be penalised for an offence?
- was the penalty of $30,000 on the bond sufficient?
- can we be a more forgiving people?
- do we want Melvyn to stay away from Singapore for a lifetime?
Saturday, November 26, 2005
Dialogue with annuitants
I held a dialogue with our annuitants. 400 people attended.
We discussed the various series of annuities issued by NTUC Income during the past years. There was a lively Q&A session. It went well.
I told the annuitants about how the annuity pool works. All of the annuity investments are put into a pool. We invest the pool prodently to earn a fairly attractive return. Most of the surplus are used to declare bonus to the annuitants.
When we declare the bonus, our aim is to be fair to all parties. Annuitants who bought the annuity earlier and enjoyed a higher guaranteed return, will earn a lower rate of bonus. The annuitants who enjoy a lower rate of guranteed return, will enjoy a higher rate of bonus.
Our aim is to be fair to all the annuitants. We do not want to favour any group of annuitants at the expense of another group. This is the concept of pooling of risks.
The annuitants generally appreciate that we have done our best to be fair to all annuitants, and to give the best possible return to them.
The dialogue went well. It was also attended by journalists from two papers. I hope that they will cover the event.
We discussed the various series of annuities issued by NTUC Income during the past years. There was a lively Q&A session. It went well.
I told the annuitants about how the annuity pool works. All of the annuity investments are put into a pool. We invest the pool prodently to earn a fairly attractive return. Most of the surplus are used to declare bonus to the annuitants.
When we declare the bonus, our aim is to be fair to all parties. Annuitants who bought the annuity earlier and enjoyed a higher guaranteed return, will earn a lower rate of bonus. The annuitants who enjoy a lower rate of guranteed return, will enjoy a higher rate of bonus.
Our aim is to be fair to all the annuitants. We do not want to favour any group of annuitants at the expense of another group. This is the concept of pooling of risks.
The annuitants generally appreciate that we have done our best to be fair to all annuitants, and to give the best possible return to them.
The dialogue went well. It was also attended by journalists from two papers. I hope that they will cover the event.
Tip: save 10% of your monthly salary
The training manager of a large company told me that they have 5,000 employees, who earn an average of $1,500 a month. Most of them do not have any savings. They spend all of their earnings.
What is my advice for them?
Here is my reply.
- Save 10% of your monthly earnings
- You may need the savings in an emergency, eg loss of job or pay medical bill
- Do not buy a life insurance plan - it penalise you when you take out the savings
- Invest in a flexible plan, such as the Ideal plan from NTUC Income
- 100% of your savings is invested from the first month
- you can earn an attractive return, ie better than bank deposit
The training manager was convinced. He wanted to arrange for his employees to attend my educational talk.
What is my advice for them?
Here is my reply.
- Save 10% of your monthly earnings
- You may need the savings in an emergency, eg loss of job or pay medical bill
- Do not buy a life insurance plan - it penalise you when you take out the savings
- Invest in a flexible plan, such as the Ideal plan from NTUC Income
- 100% of your savings is invested from the first month
- you can earn an attractive return, ie better than bank deposit
The training manager was convinced. He wanted to arrange for his employees to attend my educational talk.
Monday, November 21, 2005
We give 26% discount for off-peak car
Editor
Forum page
Straits Times
Insurance premiums for off-peak cars are too high. Time to lower them
I refer to the letter written by Mr Winston Ng, "Insurance premiums for off-peak cars are too high..." (St Times Online, 19 Nov 2005).
Mr Ng felt that insurance premiums for off-peak are cars too high. He said that these cars spend less time on the road, contribute to less accidents and should enjoy a lower rate of premium.
We agree. In fact, NTUC Income now offers a discount of 26% to off-peak car owners.
NTUC Income insures nearly 40% of all cars in Singapore. We are able to use our large base of insured vehicles to calculate a fair premium rate for each category of risks, based on their actual claim experience. Our discount for off-peak cars is based on the actual claim experience for this category.
NTUC Income now insures 5,300 off-peak cars. This represents about 50% of the 11,000 off-peak cars in Singapore.
We are able to offer competitive premium rates because of our pro-active management of claims and satisfactory service. Generally, our premiums are about 10% lower than the market. The additional discount of 26% for off-peak cars make us even more attractive to this class of owners.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Forum page
Straits Times
Insurance premiums for off-peak cars are too high. Time to lower them
I refer to the letter written by Mr Winston Ng, "Insurance premiums for off-peak cars are too high..." (St Times Online, 19 Nov 2005).
Mr Ng felt that insurance premiums for off-peak are cars too high. He said that these cars spend less time on the road, contribute to less accidents and should enjoy a lower rate of premium.
We agree. In fact, NTUC Income now offers a discount of 26% to off-peak car owners.
NTUC Income insures nearly 40% of all cars in Singapore. We are able to use our large base of insured vehicles to calculate a fair premium rate for each category of risks, based on their actual claim experience. Our discount for off-peak cars is based on the actual claim experience for this category.
NTUC Income now insures 5,300 off-peak cars. This represents about 50% of the 11,000 off-peak cars in Singapore.
We are able to offer competitive premium rates because of our pro-active management of claims and satisfactory service. Generally, our premiums are about 10% lower than the market. The additional discount of 26% for off-peak cars make us even more attractive to this class of owners.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Your comments are now welcomed
I now allow visitors to posting comments into my blog. You can also give feedback directly to me at tankl@income.com.sg.
I have found a way to stop spamming by using the "comment moderation" feature of this blog.
Tan Kin Lian
I have found a way to stop spamming by using the "comment moderation" feature of this blog.
Tan Kin Lian
Sunday, November 20, 2005
How NTUC Income reduce our repair cost
Editor
Forum Page
Straits Times
I refer to the letter from Sam Yeow entitled "It cost more to use insurer's outlet" (St Times, 19 Nov 2005).
Mr Yeow said that insurers who insist that repairs be done at their authorised workshop may pay more for their repair. He quoted his own case, where he could arrange his own repair for $300, but his insurer eventually paid $3,580 for the same repair done at its authorised workshop.
I agree with Mr Yeow. This is a common situation and result in higher repair cost and higher premiums.
NTUC Income does not use the method described by Mr Yeow. We adopt a multi-faced approach to reduce the repair cost, as follows:
- If the damages are slight, we encourage our policyholder to pay for his own repair, and protect the No Claim Discount. The saving in premium, due to the discount, can be more than the repair cost.
- Alternatively, we are willing to offer a cash settlement for the policyholder to arrange his own repair. The policyholder can find a workshop to repair for less, and keep the difference.
- If we have to pay for the repairs, we will invite our quality workshops to tender for the repair, and observe our quality standard. In this situation, the workshop will not submit an inflated bill as the repair will not be awarded to them.
We have implemented the above approach quite successfully over the past few years. This has allowed us to reduce our repair cost and offer competitive premiums to our policyholders. Our premiums are about 10 percent lower than the market.
Tan Kin Lian
Chief Executive Officer
NTUC Income
Forum Page
Straits Times
I refer to the letter from Sam Yeow entitled "It cost more to use insurer's outlet" (St Times, 19 Nov 2005).
Mr Yeow said that insurers who insist that repairs be done at their authorised workshop may pay more for their repair. He quoted his own case, where he could arrange his own repair for $300, but his insurer eventually paid $3,580 for the same repair done at its authorised workshop.
I agree with Mr Yeow. This is a common situation and result in higher repair cost and higher premiums.
NTUC Income does not use the method described by Mr Yeow. We adopt a multi-faced approach to reduce the repair cost, as follows:
- If the damages are slight, we encourage our policyholder to pay for his own repair, and protect the No Claim Discount. The saving in premium, due to the discount, can be more than the repair cost.
- Alternatively, we are willing to offer a cash settlement for the policyholder to arrange his own repair. The policyholder can find a workshop to repair for less, and keep the difference.
- If we have to pay for the repairs, we will invite our quality workshops to tender for the repair, and observe our quality standard. In this situation, the workshop will not submit an inflated bill as the repair will not be awarded to them.
We have implemented the above approach quite successfully over the past few years. This has allowed us to reduce our repair cost and offer competitive premiums to our policyholders. Our premiums are about 10 percent lower than the market.
Tan Kin Lian
Chief Executive Officer
NTUC Income
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