Non Guaranteed Rates

Dear Mr Tan

From your years of experience, do you have any statistics which indicate how far insurance companies (e.g NTUC income) deviate in their charges of yearly premiums compared to what had been indicated to the customer at the time of sale years back?

I am considering to buy a policy with non-guaranteed premium compared to one with guarateed premium, since the one with non-guranteed premium seem to be cheaper.

I worry that some years down the road they just jack up the premium... sales gimmick right from the start!!!!

MY REPLY:

When I managed NTUC Income in the past, I hold strongly the principle of fairness to policyholders.

Some other insurance companies were more interested to more profit at the expense of their policyholders. It is a difficult judgement between fairness and profits ( i.e. self interest).

I am not able to comment on the behaviour of other CEOs.

In your case, you should ask this question to the company that you intend to buy the product with non-guaranteed rates. See if they have any statement regarding how they intend to adjust the rates in the future.