I hope I don't get roasted too badly writing this post. I get the nostalgia that many old old men such as Tommy Koh, Tan Kin Lian and Tan Suee Chieh have about NTUC Income and its goal to help the lower income secure insurance coverage. This was indeed the grand vision of one of the founding fathers of Singapore, Dr Goh Keng Swee. Nevertheless, my personal thoughts and experiences are that NTUC Income Insurance has already lost track of this goal 20 years back when it was run by Mr Tan Kin Lian.
The sucky parts about NTUC Income Insurance:
At that time (20 yrs ago), NTUC Income kept selling those traditional whole-life policy that one has to pay premium until one's death bed or for 99 years. I wrote to Mr Tan Kin Lian before telling him that other insurers already started offering limited premium paying plans for only 10-20 years (and then become fully paid up) but NTUC Income was still selling its policy holders pay till 99 years old type of stupid traditional insurance plan. His immediate response was a disappointing whether I am another insurance agent from another competitor insurance company. NTUC Income products were already losing innovativeness and relevance to the real market. On a social level, it is actually harming consumers with an inferior product relative to other insurance companies.
NTUC Income was also selling to heartlander customers its investment linked polices- the NTUC Ideal Plan. One would have lost almost 15% of one's invested capital as sales charges before the remaining capital gets invested into unit-trusts. I will leave the link to a post here from 2 March 2012 on my experience with a NTUC Income Insurance agent.
I also encountered a lot of extreme questioning by NTUC Income assessor trying to get Hospitalisation and Surgical coverage for my aged parents about 15 years ago. They are the pioneer generation that worked hard for Singapore during the early days. I only succeed in getting coverage for my father (with various exclusions) but none for my mother. So what social goal is Tommy Koh, Tan Kin Lian and Tan Suee Chieh talking about that NTUC Income is helping the lower income get insurance coverage? This is Bull-SH*T by these old men. It is clear that NTUC Income is trying to reduce coverage for low income workers while aiming to preserve as much profits as possible.
Bear in mind that it is Mr Lee Hsien Loong and his government that came up with the Pioneer Generation and Merdeka Generation medical packages to help aged Singaporeans like my Father and Mum generation who most needed the medical coverages but NTUC Income is not keen to cover at all...period. Without the Pioneer generation and Merdeka generation subsidies, my sibling and I would have been saddled with hefty hospitalisation & surgical bills for my aged parents.
Is NTUC Income Insurance still relevant?
Personally, I thought that it was definitely relevant during the days of Dr Goh Keng Swee when many workers are struggling to get adequate insurance coverage. However, it has since lost its social goal decades later and at current time where for decades, they are very profit driven. Worst still is that Income Insurance is struggling with relevancy for its products and pricing relative to other insurance competitors. I have moved away from NTUC Income many years back due to its inferior products. So I do not understand why so many old men are coming out to stop the Allianz deal which actually has more pros than cons for the future of Income Insurance Ltd.
You are too kind sir. Bottom line is its shit.
ReplyDeleteIncome squandered their first mover advantage and refusal to innovate. I believe if you ask these old men if their policies are all with income, they'll keep quiet.
Yup, quite disappointed in their insurance products over the past years. I hope Allianz do come on board and bring more competitive products to benefit consumers in overall lower premium and also better choices. Else Income Insurance Ltd will just become dinosaur in no time.
DeleteTotally agree that Income's decline boils down to its products being inferior. Just not sure whether the right way out for Income is to cash out to Allianz so that NE gets unduly enriched in the process. After all, NE became majority SH of Income through a cheapo low-ball deal. A bit like rewarding incompetence if you ask me.
ReplyDeleteHi Edwin, yup, agree with you absolutely. Paying S$10 par per share instead of the min NTA per share is quite interesting news that I found out recently.
DeleteSaying that, personally, I thought that a lot of the decline can be attributed to the ex-CEOs like Mr Tan Kin Lian. Too slow to change. I recalled vividly that they only later come out with limited premium payment plans after virtually all their competitors moved on to it. They also only scrapped the stupid ideal policy for investment after they realised the cost structure is absurd to consumers who have better choices out there.
Hi - i agree NTUC has come down from quite a bit. And sadly , it is not aiming to do much better by having a good management team. It is also sad when the management team can only see as far as selling Income as the only way out. This is the real state of things. I think they have value and they are definitely selling themselves short. Having said that, i disagree with the sale completely. There has been much debate on why the sale should go / no go. And i find it sad that NTUC cannot even bother to explain what they are going to do with the monies from the sale. They are just saying sale must go through... So yes, while it is a lousy "player" in the market, they do have some cheap and good products ... Once this insurance market is made up of all foreign players, i really shudder. SG INC has too many past experiences of exiting our local market but later, as citizens we do pay a higher price. See your latest utilities bill to get a feel of this. ha ha
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