How does NTUC Income earn 4% better than similar funds?

Dear Mr Tan,

I read your posting on your Global Equity fund. During the 3 years, the annual return is 4% higher than the average for the other funds. The difference in the expense rate is only 0.3%. Where does the other 3.7% come from? Are your fund managers better than the others?

JK

---------------

Dear JK

Frankly, I do not know the answer. I think that the quality of the fund managers should be similar. Most funds will probably engage quite good investment managers.

I suspect that some of the other funds have high charges that are not disclosed in the expense rate. Maybe there are leakages that affect the return on the fund.

For example, if some investors are allowed to make additional investors at a favourable price, it will be at the expense of the other investors and will reduce the overall return on the fund.

Leaving NTUC Income

Hi Mr Tan,

I got to know from the Jan 2007 eFocus that you're leaving NTUC Income.

Your name is almost synonymous with NTUC Income.

I have full confidence in your company, under your leadership all these years, and I trust that you have your policy holders' interest at heart. NTUC Income, with it's "no-frill" image, has provided very comprehensive insurance coverage for all aspects of my insurance needs at very competitive and affordable premiums.

You came across as a very sincere person, me and my family think you'll make a very good MP....really.

It's a regret that you're leaving NTUC Income, nonetheless I wish you the very best in the next leap of your career!

SK

SAFE home for senior citizens in South West District

This program is for needy senior citizens in South West District. It installs basic safety and water saving devices to improve the living condition.

To be eligible, the senior citizen must be:

* living in South West District
* 55 years and older
* living in 1 or 2 room HDB flats

The following will be installed, free of charge to the senior citizen:

* lever tap
* shower head and 2 way lever tap
* grab bars
* light duty fire extinguisher
* wireless door bell (with light indicator)
* first aid kit
* thimble
* cistern water saving bag

Call: 6316 1616

Pay level premium for a decreasing cover?

Dear Mr Tan

I will be receiving my HDB flat soon.

I am looking at some of the mortgage protection insurance by various insurance companies. I noticed that the premium is not reducing although the sum assured decreases over the years. What is your opinion?

What advise you will give when buying mortgage protection insurance?

ET

-------------------

Dear ET

For the mortgage policy, it is usual to pay a level premium for a decreasing cover. Basically, the insurance company calculate the total cost of insurance for the term (based on the decreasing cover) and work out a level premium that matches the total cost. This type of arrangement is welcomed by the customer.

The premium for a decreasing cover is about 50% of the premium for a similar policy that provides a level cover throughout the term.

How should I invest my additional savings?

Dear Mr Tan

Currently, I have only SA of 25K protection insurance and SA of 50K on living insurance from NTUC. I am interested to increase my protection.

I wish to buy a whole life policy with short premium term, is it advisable? Is it advisable to buy investment products as the priority as it gives the best return although the protection is only 125%?

ET

----------

Dear ET

I suggest that you should put your additional savings in an Ideal plan to be invested in our Combined Fund. You can read more about this plan from this FAQ:

http://incnet.income.com.sg/uiGuide/guideDetailsPublic.aspx?gde=3304

If you need additional protection, you can buy a low cost term insurance. See this FAQ:

http://incnet.income.com.sg/uiGuide/guideDetailsPublic.aspx?gde=3020

Shall I terminate by bank investment product?

Dear Mr Tan

I have invested $5000 on an investment product from a bank which give me 10% upfront. The investment will mature upon reaching 15% or upon a period of 10 years. It is based on the 3 least performance funds to determine the % of gain.

After 3 years, I notice that the gain is always 0%. Should I cancel this investment? Is it not advisable to buy investment products from banks as their charges are higher?

ET

--------------

Dear ET

You should ask the bank what you will get, if you terminate the plan now. I suspect that you might have to suffer a loss. In that case, it may not make sense for you to withdraw from the plan.

Sudoku (Logic9) helps to train the mind

Sudoku is a popular game around the world. Many people are hooked on it. It appears daily in Today paper and MyPaper (as Logic9).

The game requires you to fill in the blanks with the numbers 1 to 9, so that it does not repeat in any row, column or box (3X3).

It trains your mind on numbers, logic and pattern recognition. It is useful for children to strengthen their mathemathics. It keeps your mind active, and is useful for older people to keep mentally alert.

I created Logic9 as my version of Sudoku. It follows the same principles, but it has certain special features. All the puzzles (at level 1 to 4) have a unique answer. Many people find it to be more enjoyable to play my kind of puzzle.

You can try this puzzle at Logic9.

You can buy a pocketbook of 128 puzzles at Fairprice, Income branches and many bookstores. It also contains 3 tips on how to solve the difficult puzzles.

Ask for Logic9. Price is $5 only.

Yield on Endowment Plan

Dear Mr Tan,

I have a plan which I have paid a total of S$114,517 over 13 years using my CPF. I received a letter stating the projected value of maturity on 10 March, 2007 is S$136,271 and yield is 3.85%.

Looking at the amount of premium paid and the maturity value, I am sure the yield cannot be 3.85% as stated.

If I am right, can I bring the case up to either MAS, CPF or LIA. I am seeking your opinion because I trust only you in this insurance industry.

LC

--------------

Dear LC

My calcuation shows the yield to be 2.45%, if you pay the premium yearly, and 2.63% if you pay the premium monthly.

Perhaps you should clarify with the insurance company. They might have made a genuine mistake in their calculation.

If it is a deliberate attempt to mislead you, then you have a case to make a complaint.

Which course should I take in university?

I was asked for my views on the following courses in university:

* electrical engineering
* chemical engineering
* double degree in electical engineering and business

As I am not familiar with this matter, I asked my yournger colleages for their views. Here is a summary:

----------

Electrical engineering requires interest in computer programming and job prospects are found in semi-conductor or IT industry.

Chemical engineering requires interest in chemistry and biology as bulk of the work is pent on laboratory experiments and research. Job prospects are found in petroleum or pharmaceutical companies.

Comparatively, electrical engineering offers a wider variety of jobs than chemical engineering because of its involvement in the vast IT industry.

Double degree in engineering and business is very useful as employers look for talents who have the technical knowledge and know how to manage a business.

Workfare Bonus

Who is eligible for the Workfare Bonus?

To get the Workfare Bonus, you must

* Be a Singapore Citizen aged 40 and above
* Be living in a property with an Annual Value of $10,000 or less
* Be employed or self-employed and work for at least 6 continuous months in calendar years 2005 or 2006
* Earn an average monthly income of $1,500 or less

The workfare bonus will be paid on 1 May 2007. You do not need to make any declaration, if you have contributed to CPF or made an income tax return for 2006. In other cases, you have to make a declaration.

http://www.progress.gov.sg/
hotline: 1800-2222-888

Financial Planning Tips

I wish to introduce you to my personal website:
website

You can find my Financial Planning Tips on the following:

1. How much should I save for my retirement?
2. How much life insurance do I need?
3. How should I invest my savings?
4. Should I buy a life insurance or investment plan?
5. What age should I retire?
6. Where can I get financial advice?

Financial Planning Tips

Prompt payment of hospital claim

Dear Mr Tan

Few months ago my wife was admitted at TTSH for breast cancer, removal of tumour.

Upon admission TTSH business executive wanted the surgery and hospital bill to be paid partly by cash and the rest by medisafe, even though I told them that my wife is holding Incomeshield Enhance/with Rider Policy, that Income will pay the bill in full. The executive insisted that we pay first and claim from Income, we left with no choice and paid the bill.

I went to your Bras Basah office to get help from your officers if they could settle our claims in due course.

I explain to JT, claims executive(Health) of my urgency of claming the bills.

JT was such a wonderful person who willing to listen to her client's request and urgency and needs with pleasnt SMILE and kind words. I really admire her WILLING TO HELP ATTITUDE towards the needy people, it is a rare charcter she possess which many people don't. You have a right staff and right place, she is an asset to Income.

Within a week the cheques arrived. That was really a help to us. My wife and I really from the bottom of our heart want to say a big THANK YOU to her through your kind attention. Please convey our gratitude to JT.

Emloyee like her to be commended and rewarded and boost their morale attitude further in some kind ways.

Once again we thank INCOME and JT. GOD BLESS. Have a good day.

Hassle free Travel

I wish to recognise the wonderful efforts of the authorities in the following countries, for making it relatively hassle free for visitors to pass through passport control, customs and health:

Countries of the European Union
Dubai
Singapore

Some countries, especially those in Asia, ask for detailed forms to be completed for their immigration, customs and health. They also ask for the detailed forms to be completed on leaving their country. This is most troublesome to the traveller, especially as they have to have to carry baggage and worry about some many other matters connected to their flight.

In most cases, the forms are not really put to use. They are just collected "blindly".

I hope that the authorities in these countries will review their outdated procedures, and make life easier for the travellers.

Older workers can work with pride and dignity

I met a policyholder. She said that her family is considering to migrate from Singapore. She is worried about the future for the elderly. She is quite sorry to see older workers work in the food centers as cleaners for a low pay. She felt that, after working for a lifetime, the older workers should not have to continue to work to make a living.

I told her this story, to give a different perspective.

When I was in Hokkaido, Japan last week, I stayed at a Japanese ryokan, ie Japanese styled hotel.

A high proportion of the workers were elderly, in the 60s or olders. They carried the luggage and cleaned the hotel room. The porter who carried my two large suitcases to my room must be much older than me! They work with pride and dignity.

In Japan, the workers are paid well, even if they do manual work. This makes them proud of their work. They do not feel that the work is demeaning.

I hope that, in Singapore, we can find a way to give better pay to our lower level workers. This will allow them to work with pride. It will also change the perception of the general public towards people doing these types of work.

Easy Ads

Many people want to sell or lease their property or sell their cars. They depend on the property and car agents. The charges are high, and the results are uncertain.

The current alternative, of putting an advertisement in the newspaper, is costly and troublesome.

I wish to develop an alternative for the owners. There will be no charge for the advertisement. The owner only pays on a successful transaction. (Yes, I trust them).

The key feature of this website is that the main mode of communication is by mobile phone. This is convenient and relatively secure.

Agents can also use this service. By acting more efficiently and reducing their time, they can reduce their charges and pass the savings to the owners.

This will be ready in April. More details will be announce soon. The website (not ready yet) is www.easyads.sg

How to pick the right stocks

Many people, on their retirement, have time to manage their personal investments.

If they know how to pick the right stocks, they can get a better return than the market average.

I plan to write a simulation game that trains people to pick the right stocks. They hae to study a few financial figures and read the recommendation of the analysts to make their decision.

They can run over several virtual years (each year will take 10 to 30 minutes) and learn from their experience.

Practice makes perfect.

This simulation game will be ready by April. It will be offered for FREE.

Website (not ready yet): www.stockpick.sg

Can I stop paying premium on my Living policy?

Dear Mr Tan

One of my living policies has been in force for 18 years. The total premium paid is $22,356. But the cash value is only $21,221.1, less than the total premium paid and cannot even breakeven. I am rather disappointed. Due to my age, I may not be able to continue paying for the premium, Mr Tan, what is your advice??

Mr Tan, I understand that you are leaving INCOME on 1 Apr 2007. You have done a lot and lot for the policy holders. especially the extra bonus every 5 years.

I would like to take this opportunity to thank you and wish you well, healthy and every successful in your future endeavours.

EN

----------------

Dear EN

The Living policy has a large coverage (ie death and 30 dread disease). This explains the reason for taking a long period to break even.

At any time, you have the option to stop paying the premiums, and keep it as a "paid up" policy with a reduced sum assured, or to cancel the policy and get the cash value (in which case the insurance coverage ceases).

My advice is to keep the Living policy up to age 70 and terminate it at that time. You can pay the premium out of your past savings. However, if it runs out, then you can consider the "paid up" or "surrender" options.

The good news is that the bonus rate for the Living policy will be increased this year.

Tan Kin Lian

Enjoy lower charges on the Ideal plan

Hi Mr Tan,

I have recently encountered a case on Greatlink (ILP Plan). It seems the insurance charges of $100K is very high. At $100K S/A, the premium on just the insurance charges can go up to $1,819/yr at age 60 based on $250/mth premium.

I recalled one of your reply on Straits Times Forum on "Insurance Time Bomb Sets to Explode".

My client would like to seek your views and opinion on this.

JY (insurance adviser from NTUC Income)

--------------------

Dear JY

You can send this message to your client.

Dear Client

I advise you to take the Ideal plan from NTUC Income. It is similar to the GreatLink plan that has been recommended to you, but it has much lower charges.

If you read the FAQ on our Ideal plan, you will get a better understanding of the difference (ie much more than $30,000).

FAQ

I advise you not to be locked into the high mortality charges imposed by many insurance companies on their ILP plan. The charges are too high. It is better to buy your term insurance separately.

For the term assurance, I suggest that you buy the decreasing term assurance, under our i-Term. It provides a large coverage at a very low cost. Details at:

FAQ

Tan Kin Lian

Which university course should my son take?

Dear Mr Tan,

Appreciate your kind advice on which course should my son takes.

He will be in University next year, and has secured a place for a Double Degree in Engineering and BA. He is still confused and does not really know which course he should take. Can you give some lights and guidance?

T

------------------------------

Dear T

Frankly, I am not good at providing this type of guidance.

I have three children and they have strong opinions about what they wanted to do (which is diffferent from my opinion). I listened to them, and help them to make up their mind. It seems to work quite well.

Maybe, you can ask your son to send an e-mail to me. I can ask him a few questions and then help him to make his decision. I can also talk to him over the telephone. Will this be helpful?

Tan Kin Lian

Policyholder is happy with settlement of Flight Delay claim

Dear Mr Tan

After due investigation by your Claims Dept, I received the payment for my flight delay this month.

I am very grateful and impressed by your readiness to do what is right and fair. Your impartiality in addressing even a trivial claim amount like my case has left me lost for words to describe my admiration and respect for you.

Thank you for allowing me to resubmit my claim and also to your colleagues in the Claims Dept for their prompt attention. I will definitely share this experience with anyone that I may come across in future who has doubts about your service standards.

I enjoyed reading your personal blogspot and believe your invaluable advices have saved many people from losing their hard earned monies in misinformed investment products.

I sincerely hope you would continue to be there for us even after you leave INCOME.

Honestly, I do not think it is easy to find someone like you to fill the gap when you leave INCOME but really hope your successor will continue your good works.

May I wish you good health and success in your future endeavours.

Thank you once again and take care.

AT

Explanation on Cash Value of Bonus

Here is an e-mail from a policyholder who asked for an explanation about the computation of the cash value of the bonus. After a few exchanges, he is satisifed with the explanation.

---------------------------------------

Dear All

Thank you very much for your prompt reply. I am very grateful that you have readily responded and come forward personally to help clarifying the matter. I am delighted with such a high level of customer service which has surpassed anyone's expectation.

I feel better now that you have assured me that the computation of the cash value is in order, and that there will be a jump in the cash value in April 2007 when the 2006 bonus is declared.

I hope that you could understand my really concern on the cash value generated from the monthly premium which I have faithfully saved for the past 17 years. The cash value is particularly important to me in view of my age and future ability to continue with the payment.

EN

Advice on investments

Each day, I receive a few requests from the public for my advice on how to invest their savings.

As I will be leaving NTUC Income shortly, I wish to suggest the following channels to obtain relevant information:

* FAQ on our products, at www.income.coop/faq
* Call the business center at 63INCOME (63462663)

It has been my pleasure to respond to the requests during the past few months. I hope that you find the new channels to be just as useful.

Tan Kin Lian

Change of focus of my Blog

I will be on leave from 20 Febuary 2007, prior to my retirement as CEO of NTUC Income. If you have any issue on the customer service of NTUC Income, please write to sq@income.coop.

I will continue to write in this blog about insurance, finance and current affairs in Singapore, but in my personal capacity. I also invite you to visit my website, www.tankinlian.com about my future plans.

A new chapter for an older employee

Dear Mr Tan,

I will always remember YOU for your magnanimous and will always be grateful to YOU for giving me hope and a new lease towards another chapter of of my life.

When other organisations were busily discarding their older employees you have the vision to employ them as CROs (Customer Relations Officers). Words cannot describe that wonderful feeling of being wanted in the society again.

I wish YOU Good Health, Good Luck and Many Good Years Ahead.

Warmest Regards

P

---------------

Dear P

I wish you all the best in your career in NTUC Income. Thank you for your heart warming words.

Tan Kin Lian

How to invest the CPF OA for 5 years

Hi Mr Tan,

How do I go about investing $100K from my CPF-OA for 5 yrs & getting a good return + insurance + maturity bonus etc ?

This year, I am 50 yrs and intend to withdraw $50K in 5 yrs when I turn 55 yrs old.

JK

-------------------

Dear JK

If you are willing to invest for 10 years, you can consider our Growth plan.

If you wish to invest for 5 years and you do not wish to take any risk, you can consider the FlexiCash.

You can buy a low cost term insurance to provide the protection:

You can read the FAQ in our website, www.income.coop/faq

Tan Kin Lian

Financial Planning Talk on 10 Feb

I have been invited to give a talk on financial planning on 10 Febuary. More details can be found at www.olivo.com.sg.

This talk is organised by a group of people who aims to educate consumers about financial planning and to promote greater transparency and accountability in the financial services industry.

This is a tea-cum-talk session, and will include as another speaker, a well-known financial columnist "Dr Money" - Mr Larry Haverkamp.

3G phone work in Japan

I was surprised that my Nokia phone can work in Japan.It is able to recognise my 3G card. I can make telephone calls and access the internet. The telco is Softbank.

Hot spring resort in Japan

I spent two days at the Noboribetsu hot spring resort in Hokkaido, Japan. It is winter and snowing in Hokkaido.

Most of the guests at the hotel are Japanese. My wife and I are among the very few foreign guests. Although the staff are not familiar with English, they make a special effort to communicate with us. We were given clear written instructions in English on the arrangements for our meals and how to use the public bath.

The public bath, which is the key attraction of the resort, uses the mineral water from the hot spring.

The hotel is a Japanese style "ryokan". The room is furnished with tatami straw mats. A 13 course dinner is served in the room. Breakfast is served as a buffet in the breakfast room.

Most guests use a yukata and a happy coat to go to tbe breakfast room or to visit the public bath.

This is my first experience of a Japanese hot spring resort. I found it to be very relaxing and enjoyable.

Low birth rate in Japan

My Japanese friend told me that it cost an average of 20 million yen (SGD 250,000) to raise a child, taking into account education and other expenses. Many Japanese find it to be too expensive. They prefer to have 1 child or none at all.

Many females to have a good education and a working career before they get married. Many are marrying qute late, in their 30s, or remaining singles.

The birth rate is quite low.

Clean air in Tokyo

I visited Tokyo last week. I observe that the air was quite clean.My host said that this is due to the strict measures taken by the auhority in controlling pollution.

This was a big improvement from the situation 30 years ago. At that time, many people had to wear face masks to avoid breathing the polluted air.

Perhaps most of the manufacturing had moved to China. In many cities in China, the pollution is quite bad. I hope that the authority will take the appropriate measures to control the pollution and improve the quality of life. This will add to the cost of manufacturing, but will still make China quite competitive.

Troublesome immigration procedures

Japan has a troublesome immigration procedure.

I am required to complete three forms, with a lot of detail:

* health check
* immigration
* custom declaration

The officer require ALL the details to be filled in. Their form contain almost twice the detail required by other countries.

They require two copies of the custom declaration form to be completed. I don't understand why.

I wish that the Japanese authorities are more considerate to visitors to their country.

Low cost term insurance

Annual premium to insure $100,000 f0r 20 years:

Annual Premium
             ----- MALE -------     ----- FEMALE -----     
Entry        i- Term       DTA      i- Term       DTA
Age          
25           $123.45     $ 50.75    $ 94.60     $33.45 
30           $154.60     $ 64.60    $120.00     $42.70
35           $218.05     $102.70    $161.55     $65.75

You can give your family adequate protection, for such a low cost.

Put all your eggs in one basket?

Dear Mr Tan,

Is it advisable to get insurance or investment policies from difference insurance company instead of "putting all eggs in a same basket.? I have brought a few policies as below.

(Details of 6 policies with AIA and Great Eastern).

What are the consideration when choosing an insurance plan and policy? What would you advise? I am 40 years old.

WC

-------------

Dear WC

It is all right to keep all your investments with one insurance company, if is is a large and well rated insurance company.

Furthermore, if you are investing in a few funds, some of these funds are likely to be managed by external fund managers. They are not affected by the performance of the internal managers employed by the insurance company.

My "financial tips" are set out below:

Tips

You can also read some of the postings in my blog www.tankinlian.blogspot.com

Tan Kin Lian

Advisory fee of 45%

Hi Mr Tan,

I recently bought a policy in 2006 Ideal (ID2) whereby I contribute $100 every month.

As I got a insurance agent to review all my policies, I was being told that my policy has a advisory fee of 15% for the first 3 years which will eat into my investment-and I will not any return being the 15% is just too high. Any reason why the advisory fee is so high.?

P

---------------

Dear P

Please read this FAQ on the Ideal plan:

ID2

The advisory fee of 15% X 3 years is actually quite low, compared to similar plans in the market. So, you are getting quite good value for this plan.

The advisory fee is used to pay commission to the adviser (agent). Our agent earns a lower commission compared to other agents. That is why the advisory fee is much lower.

Most people invest for 10, 20 or 30 years. As a proportion of the total savings, the advisory fee is quite small.

I hope that you agree with me.

Tan Kin Lian

Should I get a return for my life insurance savings

Dear Mr Tan,

I read your blog about low cost term insurance. But, my agent said that this does not give any return to me. He advised me to buy a life insurance policy that gives me a return on maturity. What is your advice to me?

CT

-----------------

Dear CT

Many insurance agents like their customer to buy an endowment or whole life policy, as the agent can earn a high rate of commission on the premium.

But, this makes the insurance too expensive and is not good for the customer.

It is better to buy a low cost term insurance (even if there is no return on the premium) and to invest the savings in a fund. Here are my tips:

Tips

Here are the information on the suitable plans:

Low cost Term Insurance
Invest in a Fund

Advantages of Flexi-Cash

Mr Tan

Many banks are now offering 3.2% to 3.5% on their fixed deposit. The return is guaranteed. What is the advantage of investing in Flexi-Cash or the Money Market Fund?

L

---------------

Dear L

Our Flexi-Cash is invested in the money market. It pays a floating interest rate, that is based on the return from the short term investments in the money market. During the past few months, the average return is between 3% to 3.5%.

The advantage of Flexi Cash is its flexibility. You can withdraw your money at any time, without any penalty. There is no lock-in period.

I have invested most of my spare savings in Flexi Cash as I intend to withdraw it, without any penalty, to invest in the equity market later in 2007 (if it corrects from the current level).

If I put the money on 1 year fixed deposit, I have to wait for the maturity date (and may miss the market opportunity). If I withdraw earlier, I have to pay a penalty.

It is better to invest in a flexible fund, with no penalty on early withdrawal.

It is also easy to transfer from Flexi Cash to Flexi Link (to be invested in the Combined Fund), as they are both managed by NTUC Income.

NTUC Income's funds give top return!

S&P CPFIS report, average return for 2003 to 2005:

The average annual return for the 17 Equity Global funds is 15.1%. NTUC Income's fund is 2nd, with 19.2%. Our expense ratio of 1.32% is lower than the average of 1.67%

                                  
                               Average Expense
                                 return  rate
FOF Utd Int'l Growth             19.3   1.19 
NTUC Global Equity Fund          19.2   1.32 
GreatLink Glo Gr Trend           18.3   2.02 
HSBC Glo D High Growth           17.7   2.04 
UOB LifeLink Global              17.3   1.13 
OAC Retire Wise Aggresive        17.3   
GreatLink Lifestyle Dynamic      16.8   1.45 
HSBC Global Leaders Fund         16.8   1.05 
GreatLink Global Value Equities  16.3   1.56 
Prulink Global Eqty              16.0   1.56 
John Hancock Worldwide Eqty      14.0   1.85 
OUBML Golden Worldwide           13.5   1.67 
AIA Portfolio 100                13.9   1.79 
GreatLink Global Intersection    13.9   1.58 
GreatLink Glb Equity             12.5   1.80 
HSBC Global Strategic 50         13.3   2.13 
HSBC Glo Dynamic All-Weather      0.8   2.55 
                         Average 15.1   1.67 

Star rating for NTUC Income's funds

Hi,

NTUC website has indicated that a few of your funds have won top4star ratings from S&P. I can't find these ratings on S&P website, perhaps you can help me to point to the appropriate link.

H

----------

Dear H

The information on ILP performance is under CPF Webpage --"Investor Education".
The web link is as follows

http://www.cpf.gov.sg/cpf_info/ie/IE_Results.asp

Tan Kin Lian

Should I invest my CPF special account now?

Hi Mr Tan

1. Should I keep my money in the CPF Special Account, as it now gives me 4%, risk free. I have read Askdrmoney.com. He has done extensive research to show that the best investment is to invest in STI ETF, followed by CPF SA, and thirdly CPF OA.

He explained that it is simply not worth taking the high risk of selecting which funds or which ILP to invest in, and then the returns might not be worth the risk.......since CPF SA is giving us a risk free guaranteed ROR of 4%.

CPF SA can only be invested in Balanced fund, and the projected return is around 5 to 6%.

I have a living policy with NTUC since 1994 when I came out of university. I recently decided to buy another term policy of 500k.

I also invested $13,000 in the Growth Fund since Jan 06. I am considering to switch into the money market funds for the time being till the markets correct.

HY

---------

Dear HY

As the stockmarket is rather high now, it is better to wait for another time, before you invest in the STI ETF or in the Combined Fund (Growth) from NTUC Income.

Two years ago, I invested in the STI ETF and made a big gain of 60%. I sold off my investment in the STI ETF recently and invested the proceeds in the money market fund.

The Growth Fund has 70% invested in equities. The balanced fund has 50% in equities. The difference is quite small. So, it may not be worth the trouble to make a switch. In my case, I kept my investments in the Growth Fund.

I agree with your approach to buy a term policy for $500,000. You get a large protection at a very modest cost. But, you must make additional savings for your retirement.

If you are investing a monthly sum, it is all right to put the investments in the Growth fund or the Balanced fund. You will be averaging out your investment over many years, so it does not matter what is the level of the stockmarket at any point of time.

Best wishes for 2007.

Tan Kin Lian

Is it better to buy a life annuity now, or wait till age 62?

Dear Mr Tan,

I like to seek your advice if it is better for us to purchase annuity at 55-year (with deferred payment till 62) or at 62-year old with the following amounts:

1. Female:
Available fund at 55 = $115,000
Available fund at 62 = $150,000

2. Male:
Available fund at 55 = $120,000
Available fund at 62 = $160,000

In addition, we wonder what is the difference between Income's Classic Annuity and Guranteed Life Annuity Plans?

N

------------------

Dear N

I think that it is better to invest in the annuity now, rather than wait for age 62. Based on our current rate of bonus, you will get a slightly higher payout at age 62, if you buy the annuity earlier. (But, I must mention that the bonus rate depend on future investment return, and is not guaranteed.

You can read about the annuity from this FAQ:

http://www.income.coop/insurance/glannuity/faq-lifeannuity.asp
Life Annuity

The Classic annuity is designed specifically for CPF minimum sum. You are only allowed to withdraw your money from age 62.

The Guaranteed Life Annuity can be taken at any time, and the payment commences immediately.

Tan Kin Lian

After 8 years, the investment is still negative

Hi Mr Tan,

I have 3 insurance policies - one investment-linked policy and 2 endowment policies.
I will keeping my endowment policies as they are my long-term savings.

As for the investment-linked policy, it is completed invested in Company P. I understand from this policy is that the mortality charges will go up as I grow older. My friend has told me that is is better to stop paying for this at age of 60.

Currently, I have kept this plan for eight years and owing to strong Singapore equity performance, the fund has performed above its benchmark. However, the value that I have accumulated in this account is still less than what I have paid in premiums.

Perhaps, the policy is still young and that part of the premiums go towards my insurance. Should I then terminate this policy and switch to a life insurance in which I only pay for 20 years and let the plan run? What do you think?

EH

----------------

Dear EH

I am surprised that after saving for 8 years, the value of your investments is still below what you have paid in premiums. It seems that the charges (for agent's commission and mortality charges) are too high.

I am not sure if it make sense for you to make a switch now. I suggest that you visit our business center and talk to our consultant. Maybe, the consultant can give you our proposal for you to make a judgement.

Avoid these insurance companies

Some life insurance companies condone the practice of their insurance agents in getting the customers to switch their old plans into new plans.

The unsuspecting customers have to incur the front end charge all over again. This is costly to the customers. The agents benefit, as they can earn a large commission all over again.

NTUC Income does not condone this practice. Our policyholders keep their policies with us for many years, much longer than other insurance companies.

Here is the proof.

Our market share in new business average about 12%. Our market share in in-force business is about 18%. Why is this possible?

The reason is simple. About one third of the business of other insurance companies are replaced by the insurance agents. These insurance agents tell their customers to switch to the new plans, which are supposed to be "better". In reality, the customer has to incur the front end charge all over again (up to two years of premiums) in making the switch. The agents earn the high commission again.

You should avoid insurance companies that have a high market share in new business, and a low market share in existing business. The insurance agents are likely to be replacing the old policies, at the expense of the customer.

Do not incur the front end charge again!

Most life insurance companies (other than NTUC Income) impose a charge of up to 2 years of the premium to pay commission to the agent and other expenses. This high charge makes life insurance unattractive for most policyholders.

To make matters worse, some insurance agents advice their customers to switch from a previous plan, into a new plan. They tell the customer that the new plan is "better" than the old plan. The unsuspecting customer will have to incur the front end charge all over again.

If your insurance agent advise you to switch your plan, you should be suspicious. Ask the agent if you have to incur a front end charge again, and how much will it cost you.

Usually, it is better to stay with the original plan, as you have already incurred the high cost. If you have to make a switch, ask the agent to refund the front end charge on the new policy, back to you. After all, you have already paid for it on the first policy.

Get better terms for your car loan

Dear Mr Tan,

Income only charges 1% on the prepayment amount for early redemption of car loan, whereas all other banks and car financing schemes in the market use the rule 78 to calculate the interest rebate plus 20% surchrage.

I think that the other financiers are rather unreasonable. At one stage there were some efforts to change this by CASE. Would you care to comment on this?

W

-------------------

Dear W

We try to be competitive and fair in our loans, including the prepayment fee.

-----------------------

Dear Mr Tan

Although the car loan from Income is competitive, most car distributors package the car prices in such a way that the selling price is lower if the customer take up a loan with one of their so called in-house finance provided by the banks.

The consumer may end up paying a higher car price by not takin the in-house finance. I saw the following announcement in your website.

-------------------------

14 May 2004
NTUC Income offers a better deal on car loans

MEDIA RELEASE

NTUC Income recognises that the Rule of 78 puts the borrower of a car loan at a disadvantage when he redeems his loan earlier. We support the proposal by the Consumer Association of Singapore to change the system.

If the borrower wishes to redeem a car loan from us earlier, we compute the interest on the loan based on the daily balance. The borrower pays the exact amount of interest calculated at the effective rate, and is not penalised for early redemption of the loan.

Under the Rule of 78, the interest is not spread out evenly over the loan period. A person pays more interest at the start of the loan. About three-quarters of the interest are charged during the first half of the loan period. As a result, the outstanding amount reduces more slowly.

Chief Executive Officer Tan Kin Lian says: "Our computation of interest based on daily balance is fairer than the Rule of 78. We also adopt a flexible approach and allow the borrower to make bigger or accelerated repayment of the loan, if he has additional funds. This allows him to reduce his interest burden."
Here is an example of a motorist who takes a car loan for $70,000 repayable over eight years at 2.35 percent interest.

The total amount of interest is $13,160. If the borrower redeems the loan after three years, the balance payable under the rule of 78 can be as much as $47,837.
If the loan was taken from NTUC Income, it would have been computed on daily balance. The balance payable after 3 years is $46,463. The motorist saves $1,374.

Buy term insurance?

Hi Mr Tan,

I like to check with you on the life insurance for my wife. She is 30 yrs old and in good health. We had a one-year son.

She had a breast scan and ultrascan on her uterus last year. The examinations discovered benign lumps on her breasts and fibroid on her uterus.

I had wanted to buy life insurance from Company X but they slapped a increase in the premium and exclusion of her reproductive organs. Due to this exclusion, I did not sign up for the insurance.

Recently, I had an agent from Company Y who said that he is willing to try for me to buy term insurance without the exclusion. However, the premium is about $50-$60 per month for $100,000.

Is the premiums too high as I compared the premium with one of the blogs on your website below?

What kind of plan do you recommend? I am open to any plans as long as she is adequately covered.

H

-------------
Dear H

Let me ask my colleague to take a look and see if we can offer better terms for your wife.

Winter in Dubai

I visited Dubai for two days earlier this week. It is winter in Dubai. The temperature is about 15 deg Celcius.

Many people think that the desert is hot the whole year round. This is a misconception.

A desert is a dry place. It can be cold. Imagine the Gobi Desert in China. I think that it can be very cold there.

Dubai is hot in summer, for three months - June, July and August. It can be very hot.

But it has winter as well.

How to calculate the return on an annuity

Dear Mr Tan,

I am keen in this 'guaranteed income' product, but i was puzzled how they workout the yield as posted on income site, say 5 yrs term giving 3.46%?

Illustration: An investment of $100,000 provides an annual income of $22,125. The interest rate is shown as 3.46%.

My calculation is:

annual payout is 22,125-20,000 = 2,125 p.a
yield = 2,125/100,000 is only 2.152% p.a.

EK

--------------

Dear EK

To calculate the interest rate for this type of payment, you have to work out the reducing balance in each year, and find the right rate of interest that produces the correct result, is reduces to nil at the end of 5 years. We use a financial calculator to work out the sums.

If you calculate year by year and use the interest rate of 2.152%, you will find that there is insufficient money to make the final payment of $22,125.

You can use an Excel spreadsheet to work out the sums, using the interest rate of 2.152% and 3.46%.

Tan Kin Lian

Magnanimous claim settlement

A policyholder was insured under the Dependent Protection Scheme. He suffered from persistent cough for 3months and eventually died of cancer. While seeking treatment, he overlooked to pay the premium for his insurance. At the time of death, the premium was outstanding for 4 months.

His wife made an appeal for the benefit under the Dependent Protection Scheme to be paid, in spite of the insurance cover being lapsed for non-payment of premium. The claims committee of NTUC Income considered the appeal. A decision was taken to pay the benefit in full, less the outstanding premium. The insured sum was $46,000.

The wife was very grateful for this compassionate and magnanimous decision. She sent the gratitude of the family to the members of the claim committee.

Please publicise your products more actively

Dear Mr Tan,

I read your blog about your investment plans. I was quite surprised that, for a typical saving plan, the plan from NTUC Income can give $20,000 to $30,000 more, compared to similar plans offered by other companies.

I wished that you had made this known earlier. It is too late for me, as I have already bought a more costly plan from my friend who worked for another insurance company. Why don't NTUC be more active in your marketing?

K

--------------------------

Dear K

I hope that you can help to tell your friends and family members. Ask them to come to NTUC Income.

They should act now, rather than wait. When an insurance agent (from another company sells to them), your friend is likely to be persuaded by the agent (who is very well trained and persuasive). Then, your friend will be stuck with a costly plan as well.

Here are the FAQs. Read them:

Flexi-Link
Ideal

55% return from Prime Fund

Hi Mr Tan,

I bought policies from NTUC since I have started working. The most satisfying return I have seen so far is from my Prime Fund. I have started with $10K since 2001 and it is worth $15.5K now!

The rise in value is due to current good stock market performance. Should I sell it while the stock market is still hot or should I hold it as view it as a long term investment?

VW

----------------

Dear VW

Both options (to sell or hold) are suitable.

In my case, I decided to hold my existing investments (as I bought them at a low price). For new investments, I decided to put in the Money Market Fund and wait for the market to correct (before I invest into the Combined Fund).

I am sorry that I cannot be more specific in my advice to you.

Wish you all the best for 2007.

Tan Kin Lian

Invest in Vietnam?

Dear Mr Tan,

I find that the stock market is too high now for investment where the risk is high and the return is limited.

I am now considering the investment in some funds related to Vietnam, where I see it as a potential glowing market. Do you think this is a right move?

EL

----------------

Dear EL

I am not familiar with Vietnam. So, I cannot advise you.

Generally, if you wish to invest in a fund, you should look at the fund manager, their knowledge of the market, size of the fund, charges.

Tan Kin Lian

My blog after 1 April 2007

Many people ask me to continue writing my blog after 1 April 2007.

I will try my best. It depends on whether I have access to the issues facing ordinary people, and my ability to find the right answers.

Tell your friends

Do me a favour.

Tell your friends to ready my blog.

www.tankinlian.blogspot.com

They can post questions to me at my website, www.tankinlian.com

Disabilty income insurance

Hi Mr Tan

I have been offered a disability income plan. It provides a monthly income in the event of disability due to illness or accident. The income will be payable in the event of continuous Disability of the Life Assured exceeding the Deferred Period. This plan does not have any cash value or maturity value.

The premiums are not guaranteed and may be adjusted based on future experience or due to changes in occupation or country of residence. Premium is S$50 per month for monthly benefit of S$2,000 at a policy term of 25 years.

I find it quite expensive. What do you think?

L

--------------

Dear L

You are paying a rate of 2.5% for the benefit. This means that the insurer expects up to 2.5% of policyholders to make a claim. The rate of claim, at a young age, is very low.

You should also consider the duration of the deferred period (for which the benefit is not payable) and the maximum length that the benefit is payable.

I am not experienced in this product, but I think that a rate of 1% or maybe 1.5% is attractive, but 2.5% seems to be quite high.

Tan Kin Lian

A safe investment for CPF savings

Hi Mr Tan,

I am looking into investing my CPF money. I am 30 and have been working for 4 yrs. I currently have about $40,000 in my CPF OA.

I am considering between the Growth and Flexi-Link Plans from NTUC Income. I am thinking of putting $25,000 into the Growth Plan first (since there is a current promotion for 1% bonus sum assured) and the rest later into the Flexi-Link Plan (growth fund) when the market cools down a bit.

What are your thoughts?

G

-------------------

Dear G

Your approach is good. Many people take the same approach.

The Growth plan can earn slightly more than 4% p.a.
Growth

Troublesome to handle many tokens

Last week, Today published my letter suggesting that the banks should appoint a third party to issue the tokens for internet banking. Each customer only need to have 1 personal token which can be used to transact with any financial institution in Singapore.

Here is the experience of a customer. She had a bank account with DBS Bank and HSBC Bank. The two banks sent two separate tokens to her.

She had to carry the two tokens with her, as she does her internet banking at the office. She misplaced one token, and had to pay $20 for a replacement.

She is worried now, in case other financial institutions sent more tokens to her for their internet access.

She likes my idea of having one personal token to be used for all internet access.

Dread disease policy with premium payable for 25 years

A policyholder bought a life insurance policy from company X (not NTUC Income) to cover $30,000 payable on death and critical illness (30 dread disease).

Company X has advertised that they were able to maintain their bonus over the past years (in spite of bonus cuts made by other companies).

Here are the brief facts:

1) Premium is $64.10 per month, payable for 25 years
2) Sum Assured is $30,000 payable on death, permanent disability and 30 critical illness
3) Protection Value at end of 25 years: Guaranteed $30,000, non-Guaranteed $14,827, Total $44,827
4) Cash Value at end of 25 years: Guaranteed $13,620, non-Guaranteed $6,718 Total $20338

The total premiums paid over 25 years is $19,225. The total cash value (not guaranteed) of $20,338 represents a return of 0.45% p.a. for the 25 years.

It is a poor return. This assumes that the non-guaranteed benefit is paid out as projected by company X.

I believe that a similar plan from NTUC Income should provide a better return, maybe 2% p.a. Our payment should be more than $20,338, even after allowing for the life insurance cover given for 25 years.

I have asked my colleague to calcuate our projected payout. I will post it later.

Invest in the Growth plan to earn about 4% p.a.

Dear Mr Tan,

I read in your blog that you have parked your fund into Money market to earn 3% interest, as you feel that the stock market is too high and will wait for the correction in 1 to 2 years time before you reinvest.

Does this mean that the Ideal Plan is considered risky in the next 12 months?

Besides the Flexicash, what other form of investment using SRS account would you recommend while waiting for the stock market to correct? 3% interest is pretty good actually!

W

---------------

Dear W

The Ideal plan takes in monthly investments over a period of many years. So, it does not matter that the market is too high at any point of time. The investments will be averaged out over the years.

If you are investing a lump sum (through FlexiLink), then you will to be careful not to commit all the money at a time when the market is too high. This is why I wish to wait for a better time.

If you are keen to earn a return of about 4% to 4.5% over 10 to 15 years, you can consider the Growth plan. A part of the return (about 2%) is guaranteed and the remaining return is variable (ie in the form of bonus declared by the NTUC Income).

The plan is locked in for 10 to 15 years, so you cannot withdraw it early. Please read:

Growth

Tan Kin Lian

Comparison of Motor Insurance Premiums

My colleague carries out a comparison of motor insurance premiums among the top insurers in Singapore. Here is the latest findings.

10 models of vehicles are compared. The premiums charge by the competitors can be up to 50% higher than NTUC Income.

 
              New Cars      3 Years       6 Years
NTUC Income   $519  100%    $504  100%   $475  100%
Company A     $782  151%    $712  141%   $721  152%
Company B     $641  124%    $591  117%   $586  124%
Company C     $546  105%    $589  117%   $618  130% 

Exit interviews of maids

Editor
Today

I refer to the letter from Lim Song Joo entitled "Exit reviews will improve maid quality" (Today, 5 January 2007).

Mr Lim suggested that the Ministry of Manpower should carry out exit interviews of maids and make the information available for future employers who may employ these maids on their return to Singapore. This allows a maid with a good record to earn a better salary from the next employer.

I agree with this suggestion. It is a useful service.

If the Ministry does not wish to be involved in this new activity, I suggest that the Ministry can appoint a private organisation to carry out the work. This organisation can manage a database and perform the work according to the standards specified by the Ministry.

There is also a need to assess the suitability of maids who are coming to Singapore for the first time. I suggest that the employer try out the maid and provide information to the central database. This information will be useful to place the maid with a suitable household. Some maids may be not suitable for certain households but may be acceptable for other households.

As many people in Singapore depend on maids, it is timely for us to use database technology to improve the recruitment process.

Tan Kin Lian

Should I pay off my loan?

Dear Mr Tan,

I have been reading your blog for quite sometimes. Very interesting and I really admire, person on high position like you still want to share and actively update your blog... I hope you will still do it although you have left Income.

I have one case study, on how do you going to invest your money. If you have 100K on hand now, base on current market condition. What would you do? How are you going to invest that money?

You are employed and your salary is more then enough to cover your expense. You have remaining liability which is your housing loan. Would you pay off some of your housing loan? Would you buy blue chip stock? Would you invest in Growth Fund or Fixed Deposit?

RK

--------------------

Dear RK

Recently, I withdrew $500,000 from my CPF. I decided to invest it in the Money Market Fund to earn about 3% interest. The interest rate varies with the market.

I did not want to invest in the stock market, as I felt that it was rather high. Actually, the stock market went up another 5% since, so I missed this part of the appreciation.

My intention is to wait for the market to correct within the next 1 or 2 years, before I invest in the market.

I have passed investments which I am still keeping in the funds, i.e. I am not withdrawing them now. So, I am partly invested and partly in cash.

In your case, if you are paying interest at 4% or more from your housing loan, it may be better to repay your housing loan. If it is lower than 4%, then you can keep the loan and invest in the money market fund (to wait for a better time to invest in the stock market.

I hope that this suggesion is useful to you.

Tan Kin Lian

-------------

Dear Mr Tan

Thanks for your suggestion. Really realy usefull...

RK

Should I re-invest my money in India?

Dear Mr Tan

I had worked in Singapore (acquired PR and am still retaining it as of now) for 2.5 years but have now relocated to India and am working in India.

While in Singapore, I had subscribed for three united liked policies from Company X to plan for my children's education needs. The initial load is high 100% for yr-1 and 50% each in yr-2 and 3. It is nearly three years now.

Though I have moved to India, I continued servicing these policies regularly.

There is a lot of opportunity in India to get a relatively larger return compared to the returns from my insurance policies.

Should I continue servicing these policies OR should I terminate them and reinvest in India? Servicing these policies is bit difficult as I have to remit foreign currency each month and expensive (forex exchange costs etc.)

While India give a higher nominal return, the possible devaluation of Indian Rupee against the Singapore Dollar could change the scenario a bit.

VR

--------------------

Dear VR

i enclose a FAQ on the Ideal plan from NTUC Income. I think that this plan is similar to the plan that you have bought from Company X.

Ideal

You can see that the upfront charge for our Ideal plan is 45% of the annual premium, compared to 200% charged by Company X. Our annual charge is also quite low, compared to most other funds.

Apart from the difference in upfront charge, you should also consider the annual charge. A difference of 1% can work out to a lot of money over 15 to 20 years.

The options available to you are:

a) To continue the existing policies with Company X
b) To switch to other investment policies in Singapore with lower charges
c) To invest in India

You are correct in pointing out the higher return in India and the potential risk of devaluation. This is an area that I am not well versed in.

Generally, I encourage my policyholders to invest in a global equity fund, to enjoy diversification and a potentially higher return (compared to investing in a specific country).

You also mentioned the trouble of remitting money to Singapore. Perhaps you can take an annual premium policy, to avoid the need for frequent remittance.

I hope that you find my comments to be helpful. I wish you all the best for 2007.

Tan Kin Lian

Should I get out of these structured products?

Dear Mr Tan,

Two years ago, I put my SRS savings into 2 principle protected 6-years structured deposit with X Bank.

The value has dropped since day 1, despite of the strong equity market in the last two years.

I chose the structured deposit to get a better return than bank interest and to avoid the risk of investing in unit trusts.

Looking back I realised that this was a mistake. I would have got a better return if I had invested in the NTUC Income's Combined Fund, for example.

I am thinking of redeeming the structured deposit now. I will lose between 9% to 12% after taking into account the guaranteed payout received during the first year. Is this a wise move?

WF
--------------------------

Dear WF

Can you give me some details about the structured deposit. What is it invested in? What are the charges?

I suggest that you write to Bank X and ask them to give you an explanation in writing about its poor performance to date. They owe it to you.

You can check this website, www.askdrmoney, to see if there is any information about this structured deposit.

As the equity market is now quite high, I do not advise you to make a switch into the Combined Fund now. Maybe, you should wait for the market to correct.

-----------------------------

Dear Mr Tan,

The structured deposits are the Vitamin and Harvest accounts. Here are the fact sheets. This is a classic example of bad investment products that small investors should be aware of.

-------------------------------

Dear WF

I suggest that you ask Bank X to tell you the following:

1. What is the payout for each year that you have invested up to now?
2. How much has the underlying shares appreciated during the same period?
3. What is the likelihood of early redemption (for the Vitamin account)?
4. What is the amount that you will get, if you decide to encash now (compared to the amount that you have invested.

I find these products to be quite complicated. I am not clear if the structuring is fair to the consumer. I hope that the answers to the 4 questions will shed some l light. You may be able to make a better decision, after you got these facts.

Let me wish you all the best for 2007.

Questions about Financial Products

Did you invest in a financial product, such as a structured deposit, unit trust or insurance product, that is not working well for you?

You can enter the details here. I will try to give my views about the product.

Questions for Mr Tan.

Tan Kin Lian

Will my savings be safe after you leave?

Dear Mr Tan Kin Lian,

In 2005, I put in $111,000 in Flexi Link. I convinced my husband to put his savings in NTUC INCOME - Flexi-Cash. The first amount was $120,000, then subsequently another $124,000, in total $351,000.

The news of your ending your career at NTUC INCOME was a shock to me - quite upsetting in fact. What was your reason for resigning, was it a good reason?

Mr Tan, I have not met you but i feel that you are a man of integrity and foresight.

NTUC INCOME has done extremely well under your leadership. Would you advise me will our money be safe under both Flexilink and Flexicash? Can NTUC Income ensure safe returns in 10 years time?

Both my husband and I are 58 years old and these are our life-savings. Thank you.

CA

----------------

Dear CA

Thank you for your kind words.

NTUC Income will continue to be well managed after I leave. I will be keeping most of my personal savings with NTUC Income in the Flexi-link plan, invested in the various funds. I am 58 years old. My family will also be keeping their savings with NTUC Income.

You can read about my future plans in my personal website, www.tankinlian.com. I intend to work in Middle East and Indonesia to help my partners to develop their insurance business.

I wish you and your family all the best in health and happiness.

Tan Kin Lian

What is permanent and total disability?

Hi Mr Tan,

I came across your blog while surfing and read through some of your postings. I am grateful that though being the CEO, you have not been baised on your comments.

I wish to seek your clarification on this clause.

"Totally and Permanently Disabled" means the complete and continuous inability of the Life Assured at that time and at all times thereafter to engage in any business or occupation or perform any work of any kind for remuneration or profit.

The total and irrecoverable loss of sight of both eyes or the loss by complete severance of both limbs at or above the wrist or ankle or the total and irrecoverable loss of sight of 1 eye and the loss by complete severance of 1 limb at or above the wrist or ankle will also be regarded as constituting Total and Permanent
Disability"

If a person has no control over both limbs but choose not to amputate them, can it be regarded as constituting Total and Permanent Disability?

C

-----------------

Dear C

If it can be medically proven that the life assured cannot use two limbs totally and permanently, then it should qualify as a total disability claim. Perhaps the difficulty is to establish this fact, if the limbs are not amputated. Perhaps you can tell me more about the medical condition, and I can ask a doctor for his opinion.

-----------------

Hi Mr Tan,

The reason I'm asking that specific clause is because an agent claims that his company does not require the life assured to amputate the limbs in order to claim for total disability whereas other companies including Income required the limbs to be
amputated and must be at or above the wrist or ankle as specified in the clause.

-------------------

Dear C

Although the clause states that amputation is one condition of proof of total disability, there is also another condition and that is the inability to carry out any occupation. If two limbs are totally useless, it is easy to prove the inability to perform any occupation.

Anyway, it is NTUC Income's policy to interpret the clause fairly. I am sure that they will not insist on imputation under the circumstances that you have describe.

It is important for you to buy a product that gives you better value. Do not be swayed by minor differences such as this type of condition, which affect maybe 1 in a million people.

Best wishes for 2007

I send best wishes for 2007, to all readers of my blog. Best wishes for your good health and success.

Tan Kin Lian

Free lance programming in PHP, MySQL

I am looking for free lance programmers who are able to develop software in PHP and MySQL.

Please send your e-mail address to me at kinlian@gmail.com.