Tuesday, December 25, 2012

Christmas 2012

wishing each and everyone, all the joys and blessings of Christmas!

Tuesday, December 4, 2012

oac - launch of mortgage protector advantage

oac or overseas assurance corporation, a wholly owned subsidiary of great eastern holdings and a member of the ocbc group has just launched a mortgage reducing term assurance plan, mortgage protector advantage which refunds all the premiums at the end of the policy term if no claim has been made. there is also a guaranteed surrender value of at least 40% of total premiums paid after policy has been in force for 7 years.

this is a first in the market as no other insurer offers a premium refund for similar class mrta products. 2 years ago, oac launched a refundable premium mortgage plan known as mortgage protector plus which differs from the current one in that it is priced to be a single premium plan.

my comments:

for mortgage protector advantage, the premium for a 40 year old male, non-smoker with sum assured of $1 million for a term of 20 years at an interest rate of 5% works out to have an annual premium of $5,846.67 which is payable for 15 years totalling $87,700.05.

in contrast, the mortgage protector (without premium refund) is priced with an annual premium of just $1,760.00, also payable for 15 years totalling $26,400.00.

whatever your views on this latest mrta plan by oac, one cannot deny that it adds yet another option available in the highly competitve mortgage insurance market.

Monday, December 3, 2012

china bank's 'troubled wealth product'

in an article with the same title, it was reported that investors who had bought products issued by zhongding wealth management centre rushed to huaxia's shanghai branch yesterday, after weekend reports online that the products had stopped making payments which reuters could not confirm on the payment status of the products.

the bank said it was "aware" of reports that the investments could not be repaid when the products matured but huaxin did not confirm those reports.

in the last few years, sales in china of so-called wealth management products (some with terms as short as a few weeks) have soared (which grew to 12.14 trillion yuan in the first half of 2012) as banks compete for deposits with products offering higher interest rates than those offered on savings accounts. huaxia bank was one of the 5 most active issuers cited in the july report by consultancy cn benefit.

my comments:

the question to ask is; are there really investments in the financial jungle which promises quick and higher returns? but of course, there are if u base the answer to the question on the many ads in our dailies, the internet and even the social media, promising quick and big returns.

my take is there will always be products that are dangled offering quick and higher returns as compared to say, plain vanilla bank deposits.

but the more significant point is, does the higher returns come with lower risks and more importantly, are the higher returns fully guaranteed?

and that is the $64 million dollar question.

but do always keep in mind the cardinal principle that the higher the risks, the higher the potential returns but these are usually always never guaranteed.

which leads us to the other principle which is 'caveat emptor' and heeding this warning may perhaps be the hindsight which everyone will surely appreciate rather than be sorry afterwards.

Monday, November 26, 2012


myanmar nationals

we have just received this email notification from tokio marine life insurance singapore:

Dear Business Partners,

We are pleased to inform that we accept Myanmar nationals who are Singapore PR or holding a valid Employment Pass (EP).

Myanmar nationals, who are Singapore PR or EP holder, please use the Singaporeans Underwriting Guidelines, subject to the respective benefit limit.

However, please note that for EP holders, maximum Death/ Total Permanent Disability (TPD) / Dread Disease (DD) benefit will be capped at S$500,000.

We have attached the proposal handbook for your easy reference.

Appreciate your kind assistance to disseminate the information to all your advisers.

Thank you.


*Joyce Soh*
Administrative Executive, Distribution Operation Department
T 6592 6229 | F  6223 9120
*Tokio Marine Life Insurance Singapore Ltd.
*20 McCallum Street #07-01 Tokio Marine Centre Singapore 069046 | _www.tokiomarine-life.sg <http://www.tokiomarine-life.sg/>

my comments:

it's good news because tokio marine life insurance singapore has opened their gates to accept life insurance applications from myanmar nationals who are singapore prs or holding a valid employment pass.

i suppose with the country's reforms and sanctions being gradually lifted, tokio marine life insurance singapore is one of the first insurers to accept business from myanmar nationals. and i reckon more insurers may do the same.

Thursday, November 22, 2012

happy thanksgiving day

a happy thanksgiving day to all americans, canadians and to my family and relatives and also to all the people that i have got to know and love.

*from wikipedia:

Thanksgiving Day is is a national holiday celebrated primarily in the United States and Canada, with several other places around the world observing similar celebrations. Thanksgiving is celebrated on the fourth Thursday of November in the United States and on the second Monday of October in Canada. Today, thanksgiving is a festival of family reunion. Family members gather for a reunion to give thanks for the good things that they have. Thanksgiving has its historical roots in religious traditions, but today is celebrated in a more secular manner.

my comments:  

wouldn't it be nice if our government legislates to make thanksgiving day a national holiday in our tiny red dot nation.

sorry to digress from my usual blog on insurance but on this day, it is opportune for me to give thanks to my Lord and Saviour, Jesus Christ for his grace, love and mercies. and thanks also to my family and relatives, colleagues, friends and everyone that i have been blessed to have met.

and last but not least, for installing me in a position to significantly impact lives from my role as an independent financial adviser.

Tuesday, November 20, 2012

prudential - launch of early stage cw and cw III

prudential has just launched their early stage crisis waiver and crisis waiver III.

what are the benefits of early stage crisis waiver?

Benefits of Early Stage Crisis Waiver
  • Upon the diagnosis of an Early Stage Medical Condition, future premiums will be waived for 5 years.
  • You may claim the benefits for Early Stage Medical Conditions twice during the term of the policy. The second claim will waive the premium for another 5 years. This is provided the second claim is not for the same Medical Condition as the first claim, and it does not fall within the same category of the first Early Stage Medical Condition.
  • You can claim for 10 years waiver of premiums upon the diagnosis of Intermediate Stage Medical Conditions. However, if there was a successful claim under Early Stage Medical Conditions, the Intermediate Stage Medical Conditions Benefit only waives 5 years of future premiums.
what is the benefit of crisis waiver III?

Benefit of Crisis Waiver III
  • Your remaining premium payments for the covered benefits are waived upon diagnosis of any one of the specified 30 critical illness.
my comments:

as quite a number of insurers have already launched what i term as 2nd generation critical illness products, prudential is probably the first to launch their early stage crisis waiver.

i reckon the competition will also launch similar early stage crisis waiver under a different name pretty soon.

for insurers still without a 2nd generation critical illness product, my guess is the day is not too far off when we will see this product launch, probably at the start of 2013.

Monday, November 19, 2012


at our monthly business meeting today (compulsory for all advisers), mr albert phua, our compliance officer reminded us of compliance to the representative notification framework which came into effect from november 26, 2010.

apparently, this was in response to the monetary authority of singapore's circular dated november 16, 2012 which noted many instances of tardy or non-compliance to 2 key provisions namely:

1)    Cessation to act as a representative or to carry on regulated activity. (Time frame - Immediately) and

2)    Change in the status/particulars of representative. (Time frame - within 7 days of its occurrence).

my comments:

if there's one principle which every financial adviser or financial entity must always bear in mind, don't play play (with apologies to mr phua chu kang) with the authorities and the other is every company exist because of their customers.

the change in the status and particulars of any financial adviser must be reported within 7 days of its occurrence, failing which the financial adviser and financial entity will be subject to disciplinary proceedings.

and that's why every single person in the financial industry must continually be 'on the ball' in order to be able to carry on business as usual and on this, there can never be any compromise.

Thursday, November 15, 2012

mas looks to tighten ad rules for investment schemes

speaking in parliament, mr tharman who is the MAS chairman and finance minister said that the central bank is working with the ministry of communications and information and other agencies to "minimise the scope to mislead consumers through advertisements".

mr tharman added; "MAS will continue its efforts in educating singaporeans on the pitfalls of dealing with unregulated entities and the risks of unregulated schemes."

my comments:

Wednesday, November 14, 2012


world diabetes day

today is world diabetes day.

why is this relevant to singapore?

in our tiny red dot nation, there is a worrying trend that diabetes is afflicting more people. in the 70s, it was just 2%, in the 80s, it was double at 4% and latest statistics show 11.3% of the population has diabetes. more significantly, 14% of our population are already pre-diabetic. indians and malays are at higher risk of contracting diabetes while the chinese has an almost 10% of the same risk*. the idf (international diabetes federation) estimates that, globally, 187 million people do not yet know they are suffering from the condition.

*source: radio 93.8 body and soul program hosted by daniel martin

my comments:

to lower the risk, lifestyle changes is a key factor in delaying the onset of diabetes, especially among those who are already obese.

in terms of insurance planning, 1st generation critical illness products do not have coverage for diabetes but more recent critical illness products which i term as 2nd generation ci products* come with this coverage. having said this, it must be stressed that the coverage is specifically defined and capped with a low sum assured.

*for example, prudential pruearly stage crisis cover is the first insurance policy of its kind in Singapore to make payouts for selected diabetic complications. A payout of 20% of the sum assured will be made upon diagnosis of one of the covered Diabetic complications, up to a limit of S$30,000. Diabetic complications covered include Diabetic Retinopathy, Diabetic Nephropathy or amputation of part of limb due to gangrene.

in the final analysis, the best defence against diabetes (as in most diseases) is managing one's lifestyle.

Tuesday, November 13, 2012

happy deepavali!

wishing all my hindu friends and all hindus a very happy deepavali and may good always triumph over evil.

Monday, November 12, 2012

tale of a client

today, a client gave me a 'dressing down' for not keeping him/her informed of the launch of new insurance products. this is because the client is on an old shield plan with dollar capped benefits as opposed to new integrated shield products that offer 'as-charged' benefits and he/she would have upgraded to the enhanced shield plan if informed accordingly.

my instant reaction was to apologise and explained that it is highly improbable to keep every single one of my clientele continually informed of new insurance products.

my comments:

even with my apology, this person was not happy with me. to pacify him/her, i said i can try my best to do so for future launches of new products if an email can be sent to me requesting for the same.

the reason is because most people i know will treat the email blast of new insurance products as spam and may even lodge a complaint with the authorities.

sigh, nowadays, it is getting more and more difficult to manage clients' expectations.


Thursday, November 8, 2012

liberty insurance - launch of senior care

today, liberty insurance launched a new pa plan for senior folks, senior care.

what is senior care?

senior care is a personal accident plan specially tailored for senior folks with entry age commencing from 50 years. there are 3 plans available, namely essential, economy and executive being the top tier plan.

my comments:

there are really very few personal accident plans in the market catering to senior folks and liberty insurance's senior care extends entry age to 75 years which is renewable up to age 85 years. it is open to both singapore citizens and permanent residents who are permanently residing in singapore.

insurers prepare for 'supercentenarians'

yes, british insurers are taking cognizance of the fact that life expectancy is not static and will continue to add years, going forward by modelling pension products on the basis that people could live to the age of 120 or even 125 years.

britain's oldest man, mr reg dean recently celebrated his 110th birthday on sunday. but it may not take long for mr dean to be overtaken by a new breed of what is termed as 'supercentenarians'.

quoting the office for national statistics, data showed that the number of uk people aged 100 or more has increased 5 fold from 2,500 in 1980 to 12,640 in 2010 and projections suggest that the number of centenarians will exceed 160,000 by mid-2040.

at a conference, mr otto thorensen, director general of the association of british insurers said:
"With men and women living on average 30 years longer than they did 100 years ago, by 2100, people living to over 100 years old will be the norm."

my comments:

with increasing life expectancy, just ponder the challenges facing insurers worldwide (including singapore) on pricing products.

recently, with her passing, our very own supercentenarian, ms teresa hsu lived to a ripe old age of 113 years.

yet, some of our insurers have launched whole life products that come with a maturity of the insured attaining age 99 years or age 100 years.

and with increased longevity, raises another issue in terms of retirement planning. by and large, many people have still not planned for their golden years. even for those that have done theirs, i urge them to do a regular review because many of the retirement plans i have seen are not realistic based on 20 to 30 years of living in retirement. in other words, up to age 80 years max.

other than this, it is also a fact that generally, our population can be considered to be under-insured.

well, i reckon lots more need to be done to educate the masses of the importance of planning.

Tuesday, November 6, 2012

life insurance industry performance up to 3rd Qtr 2012

in a media statement released today, the lia (life insurance association of singapore) reported that the life insurance industry achieved a total of $1,608.1 million in weighted* new business premiums for the first nine months of 2012 which saw a 10% improvement over the corresponding period in 2011. but single premium business recorded a drop of 10% at
$447.3 million with 14% comprising CPF-funded sales.

*   The weighted new business premium figure is calculated as follows:
    10% SPI + 100% API with adjustment for premium payment terms of less
    than 10 years.

the tied channel continue to dominate with 44% of the new business with the bancassurance taking another 37% and 15% of the pie going to financial advisers and the balance of 6% to the other channels. 

my comments:

as usual, the bulk of new sales came from par products which accounted for 52% of new business with non-par taking 29% and investment-linked products making up the balance with 19%.

as if to emphasise the status quo of the population being under-insured, the bulk of claims or more than 93% of $4.20 billion were paid for policies that matured while only $313 million was paid in respect of death, critical illness or disability claims.

for the kyc form, the 4 options of:

1.  full advice
2.  partial advice
3.  product advice and
4.  no advice 

has been replaced with the following (since Aug 01, 2012):
  1. Comprehensive Planning
  2. Specific Need(s) Planning
  3. No Needs Analysis Purchase

Tuesday, October 30, 2012

another life insurer?

today, david choo (managing director of promiseland independent pte ltd) and myself sat down with a management staff of the largest life insurer (in the country of origin) and discussed the probability of being one of their partners in distributing their products.

the person who met us disclosed that they have received in-principle approval for a life licence (pending meeting other requirements) to doing business in our tiny red dot nation. he also shared that our regulator (meaning the monetary authority of singapore) has been pretty strict but very transparent.

my comments:

when i joined the industry 15 years ago, an agency leader from a large insurance company warned me that the insurance business (at that time) is already saturated.

if this is true, why are there foreign insurers who continue to eye singapore and seek to do business here?

i reckon more insurers here will translate into ever more choices for consumers and it is definitely more positive than anything else.

Monday, October 29, 2012

standard life - launch of maiden products

today, i attended standard life's launch of their maiden products into the singapore market held at the raffles hotel.

standard life's offerings are all investment-linked products with a lump sum or single premium plan and 2 regular savings plans.

my comments: 

these products are not meant for the 'mass-market' as standard life's licence is restricted to the defined market segment*.

*Explanatory note: DMS insurers are registered with the MAS to conduct only non-CPF business and with minimum policy sizes.

for example, the investment plan which is a single premium ilp has a minimum requirement of US$50,000 or S$80,000. as for the other 2 ilp products which is the regular savings plan classic and regular savings plan wealth, there is a specified minimum contribution of US$420 or S$670 for monthly contribution, assuming a term of 10 or more years.

with these latest ilp products means even more choices for our consumers and there are now 18 insurers operating in our tiny red dot nation.


Saturday, October 13, 2012

medishield enhancements

the ministry of health has announced enhancements to the medishield scheme effective from March 01, 2013 and these include:

a.   annual and lifetime limits will be increased from $50,000 and $200,000 to $70,000 and $300,000 respecticely;
b.   maximum age of coverage will go up to age 90 from age 85 currently;
c.   the maximum entry age of 75 will be removed;
d.   coverage will also be extended to inpatient psychiatric treatment at $100 per day but capped up to 35 days per year; and cover short-stay wards in Emergency Departments;

on the flip side, class B2/C deductibles will go up by $500 for those aged 80 and below and premiums will be raised between $17 and $251 yearly. To help with the higher premiums charged, our government will be giving a one-off top-up to medisave of between $50 and $400 for those on medishield. At the same time, the medisave withdrawals limits will be raised to $1,000 (for those aged 76 to 80) and $1,200 for for those over 80 years of age.

my comments:

the enhancements are long overdue and is welcome news to all who are on the medishield scheme estimated to cover up to 92% of the population.
however, medishield will not extend coverage to babies born with congenital diseases or those that need neonatal care.
another request to allow medisave to pay for either the deductible or co-insurance rider was rejected which may lead to both overconsumption and overservicing of health care.
i would have been delighted if the enhancements include lifetime coverage because of increasing life expectancy and higher limits on in-patient benefits. but i guess the ministry of health is taking what i term as 'baby steps' in balancing the enhancements with the expected repricing of premiums which is still pretty hefty for those who are already elderly and living in the twilight of their years.

Tuesday, October 9, 2012

prudential - launch of pruflexicash protection plus

prudential has added an anticipated endowment plan to their stable with the launch of pruflexicash protection plus.


  • Lump sum payment of up to 4 times the sum assured of PRUflexicash protection plus in the event of Death Accelerated Terminal Illness or Accelerated Disability1
  • Flexible policy terms of 15 or 25 years
  • 3 smart ways to enjoy your Yearly Cashback3:
    • Receive a Yearly Cashback after the second policy anniversary and use as you wish, such as a family holiday.
    • Enjoy bigger payouts on your policy if you choose to defer receiving your Yearly Cashback after the 10th policy anniversary or later4.
    • Accumulate your Yearly Cashback and get a non-guaranteed interest5 of 3% p.a. by leaving it with us.
  • Future Insurance Option6 (FIO) to buy new plan7 within 4 years from first premium due date even if health changes. You are assured of enjoying increased coverage of up to 4 times the sum assured of your PRUflexicash protection plus or S$200,0007, whichever lower.
  • Whichever policy term you choose, upon maturity you will receive in total 120% of the sum assured of PRUflexicash protection plus, plus all the bonuses (non-guaranteed) that were added to the plan every year.
  • Choice of cashing in bonuses (non-guaranteed) accumulated
  • Option to borrow up to 90% of policy's cash value**
  • Interest-free loans to cover medical expenses resulting from a surgical operation+
  • Add on these supplementary benefits for more comprehensive coverage
    • Crisis Cover III provides you with a lump sum payment in the event that you are diagnosed with any one of 30 critical illnesses
    • Crisis Waiver III pays for your premiums in the event that you are diagnosed with any one of the 30 critical illnesses
    • Comprehensive Personal Accident III provides an additional lump sum payment in the event of accidental death and dismemberment
      • reimburse your medical expenses incurred due to the accident and pays out a weekly income if you are unable to work because of the accident.
^ Terms and conditions apply
** There is an annual interest rate on the loan amount, which is non-guaranteed and subject to change.
+ This loan is available at the discretion of the insurance product provider and may be granted upon satisfying required conditions.
1 Policy provides coverage against Accelerated Terminal Illness and Accelerated Disability during the term of the policy, and before the anniversary of the policy on which the Life Assured will attain the age of 65. We will pay for either Accelerated Terminal Illness or Accelerated Disability but not both.
2 Bonuses are not guaranteed and will vary according to the future experience of the participating fund.
3 Yearly Cashback is a payout of 5% of PRUflexicash protection plus sum assured after the 2nd Policy Anniversary.
4 No later than one year before the end of policy term.
5 An annual interest rate will be applied on the accumulated Cashback. The interest accures on daily basis. This interest rate may vary.
6 This benefit is only applicable to PRUflexicash protection plus purchased under standard terms. The maximum age to exercise the FIO is 44 years old.
7 Excluding PRUflexicash protection plus or any other policy with a FIO.         

Tuesday, July 3, 2012

fee-based model may leave more underinsured

in a recent interview with the straits times, mr tony wilkey, the chief executive of insurance at Prudential Corporation Asia commented that moving the renumeration model to a fee-based one could leave even more people underinsured.

"It is a different value proposition for the consumer to write a personal cheque in advance to get the advice before a product is delivered.

The affluent customer is more likely to pay, but historically in other countries, the mass market consumer has not been seen as willing to write cheques.

This concerns me because if they are unwilling to pay for advice, then the likelihood of them purchasing what the family needs could be impacted. Theoretically, we could end up increasing the underinsurance gap."

two other CEOs, mr chris wei of great eastern life and ms annette king of manulife also raised similar concerns.

my comments:

mr wilkey was giving his comments on the likely sweeping reforms by FAIR set up by the Monetary Authority of Singapore in march and will make it's recommendations by the fourth quarter of the year.

my take is there is no one perfect renumeration model or one size fits all approach to the renumeration structure, just as every individual is unique.
the answer may life in adopting several structures and as mr wilkey has opined that we may end up increasing the underinsurance gap if a pure fee-based one is implemented.

Wednesday, May 30, 2012

tokio marine life insurance - launch of tm retirement life

today, i attended tokio marine life insurance's soft launch of tm retirement life at ntuc auditorium at one marina to roll out their latest product, tm retirement life. the official launch date is may 31, 2012. what is tm retirement life? this is a hybrid limited premium participating whole life plan with yearly cash benefits from either age 60 or age 65 (referred to as the 'payout' age) for as long as the life assured lives. my comments: the plan provides coverage for death and terminal illness and is available for both single life and joint-life application (husband and wife). starting from the selected payout age (either age 60 or age 65), a guaranteed cash benefit equivalent to 5% of the sum assured will be payable yearly for as long as the life assured is alive. payment of the cash benefists does not reduce the death benefit and sum assured. once again, as in most of tokio marine life insurance's participating products, the reversionary bonus rate is projected at $10 per $1,000 sum assured compounding at 1% per annum. this is neither aggresive nor overly optimistic as indeed, the worsening eurozone debt crisis has seen a flight of captial to safety like us and german government soverign papers. this product may be suitable for consumers looking for a perpetual 'bank account' (note, not perpetual securities) and can be considered to be an annuity also. tm retirement life is also open to joint-life application which of course is restricted to a legal husband and wife relationship. what's interesting is the plan will continue to pay the guaranteed cash benefit which is equivalent to 5% of the sum assured for so long as any of the life assured is alive from the selected payout age. today, there are not many insurers offering an annuity product in their stable and it is perhaps not difficult to understand why this is so, against the factor of ever increasing life expectancy here because our tiny red dot nation have one of the longest life expectancy on planet earth. and it is simply very demanding of the insurer to come out with such a product due to the very stringent requirements of reserves versus liabilities on a very long term horizon. and last but not least, promiselanders now have an additional option (a lifetime stream of guaranteed income) to offer consumers.

Tuesday, May 29, 2012

changes in cpf minimum sum, medisave minimum sum and medisave contribution ceiling from july 01, 2012

the cpf board has announced that cpf members turning age 55 between between 1 July 2012 and 30 June 2013 will need to set aside a Minimum Sum (MS) of $139,000 soon. the previous minimum sum for 2011 was $131,000. as for the medisave minimum sum which is the amount that a person turning 55 needs to set aside for his hospitalisation expenses in subsidised Class B2 and C wards, subsidised outpatient treatment for selected chronic conditions and basic MediShield and ElderShield premiums in his old age, will be raised from $36,000 to $38,500. cpf members will be able to withdraw their medisave savings in excess of the medisave minimum sum at or after age 55. the maximum a cpf member may have in his medisave account known as the medisave contribution ceiling is set at $5,000 above the medisave minimum sum and therefore, the latter will be increased to $43,500 from $41,000 previously. any excess of the prevailing medisave contribution ceiling will be transferred to the cpf member's special account if he/she is below age 55 or to his/her retirement account if above age 55 and has a medisave shortfall. my comments: is it any surprise that the adjustments to the cpf minimum sum, the medisave minimum sum and medisave contribution ceiling has been adjusted to account for inflation, longer life expectancies and rising expectations of quality of life post retirement. even though the minimum sum is $131,000 currently and yet, a vast majority of cpf members still fall short of the cpf minimum sum, even after pledging their property which is permitted up to 50% of the minimum sum with the latest figures showing that only 45% of cpf members have met the minimum sum requirement.