I suggest that feeder services should be introduced to ply certain districts and bring the commutters to the MRT trains or bus terminals.
The feeder services can be operated using light buses, like in Hong Kong.
They can serve a useful purpose of providing transport to the neighbourhood malls, schools or community facilities.
These services should be farmed out to small operators, and not placed under the large transport operators.
It is easier for the public to learn how to use the local feeder services. Many people find the current bus services to be too complicated to use.
If you agree with this suggestion, please vote in LTA portal
Saturday, April 21, 2007
Selling your life insurance policy
If you are not able to continue with your life insurance policy, the insurer will pay its cash value to you. This cash value is calculated by the insurer to give them a profit when you surrender.
You may be able to find a buyer who is willing to pay a higher amount to buy the life insurance policy from you. The buyer will continue to pay the premium and collect the maturity or death benefit.
This breaks the monopoly of the insurer who issue the policy. This competition may force the insurer to pay a higher cash value to their policyholder.
There is a moral risk that the buyer of the policy may benefit substantially on the premature death of the policyholder. Apparently, this is allowed by law.
Someone has set up an operation in Singapore to buy over the life insurance policy from the policyholder. If you look for "sell endowment" in Google search, you may be able to find some links to this service.
You may be able to find a buyer who is willing to pay a higher amount to buy the life insurance policy from you. The buyer will continue to pay the premium and collect the maturity or death benefit.
This breaks the monopoly of the insurer who issue the policy. This competition may force the insurer to pay a higher cash value to their policyholder.
There is a moral risk that the buyer of the policy may benefit substantially on the premature death of the policyholder. Apparently, this is allowed by law.
Someone has set up an operation in Singapore to buy over the life insurance policy from the policyholder. If you look for "sell endowment" in Google search, you may be able to find some links to this service.
Life insurance with regular paybacks
Some life insurers market a whole life or endowment policy with regular pay-backs every one, two or three years. They sell large numbers of these policies.
This type of plan give poor value to the customers. Here is the reason:
* the insurer charges the normal premium for the basic policy
* they add an additional premium for the regular payback
* the additional premium has to loaded to cover the commission and expenses
For example, if the regular pay-back is $3,000 every 3 years, the insurer has to add $1,000 plus $100 (to cover commisison and expenses). It does not make sense for the customer to pay an additional $1,100 a year to get $3,000 every 3 years.
This is not transparent to the customer. The customer is not aware that he is paying an incurring additional expenses for this benefit. He is worse off.
Somehow the insurance agent is able to make this plan look more attractive than its reality. This is the power of false marketing.
This type of plan give poor value to the customers. Here is the reason:
* the insurer charges the normal premium for the basic policy
* they add an additional premium for the regular payback
* the additional premium has to loaded to cover the commission and expenses
For example, if the regular pay-back is $3,000 every 3 years, the insurer has to add $1,000 plus $100 (to cover commisison and expenses). It does not make sense for the customer to pay an additional $1,100 a year to get $3,000 every 3 years.
This is not transparent to the customer. The customer is not aware that he is paying an incurring additional expenses for this benefit. He is worse off.
Somehow the insurance agent is able to make this plan look more attractive than its reality. This is the power of false marketing.
Friday, April 20, 2007
Critical illness
I use Google search to find out about "critical illness" policies available in other countries.
The websites are mainly from the United Kingdom. They offer critical illness on a level or decreasing cover, similar to term insurance.
I wanted to compare the premium rates in the UK with those in Singapore.So far, I am not able to get the comparable premium rates, as the websites are managed by brokers who insist on "talking" to me. I shall continue to try.
Some of the websites are quite educational and informative.
The websites are mainly from the United Kingdom. They offer critical illness on a level or decreasing cover, similar to term insurance.
I wanted to compare the premium rates in the UK with those in Singapore.So far, I am not able to get the comparable premium rates, as the websites are managed by brokers who insist on "talking" to me. I shall continue to try.
Some of the websites are quite educational and informative.
Decreasing term with living benefit
Hi Mr Tan.
I am 24 years old. I like to know whether there is term insurance longer than 20 years. Does a 20 year term insurance auto-renews itself when it ends? Do you recommend buying decreasing term (e.g.$100k) and living benefit (e.g.$50k) together?
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REPLY
You can buy a term longer than 20 years. It is available for 30 years or to cease at a specified age, say 65 years.
The term policy does not auto-renew itself. It will cease at the end of the term. You should buy term insurance for the entire period that you need the insurance.
It is a good idea to buy a decreasing term assurance and a living benefit (to cover critical illness). The living benefit can also be for a specified term.
I am 24 years old. I like to know whether there is term insurance longer than 20 years. Does a 20 year term insurance auto-renews itself when it ends? Do you recommend buying decreasing term (e.g.$100k) and living benefit (e.g.$50k) together?
-------------------------
REPLY
You can buy a term longer than 20 years. It is available for 30 years or to cease at a specified age, say 65 years.
The term policy does not auto-renew itself. It will cease at the end of the term. You should buy term insurance for the entire period that you need the insurance.
It is a good idea to buy a decreasing term assurance and a living benefit (to cover critical illness). The living benefit can also be for a specified term.
How to invest in index funds
According to John Bogle, it is better to invest in the entire market through an index fund.
If you wish to invest in an index fund in Singapore, the closest that you can invest is the STI tracker fund, that is traded on the Singapore Exchange.
If you go outside of Singapore, there are many hundreds of choices. You can find out more using Google search to look for "index funds". Some of the websites provide educational materials.
If you wish to invest in an index fund in Singapore, the closest that you can invest is the STI tracker fund, that is traded on the Singapore Exchange.
If you go outside of Singapore, there are many hundreds of choices. You can find out more using Google search to look for "index funds". Some of the websites provide educational materials.
Planning for a retirement income
Hi Mr Tan.
I am 37 years old. If I save $20,000 a year for next 18 years at 5% return, I would accummulate about $500,000 when I reach 55 years old.
With this amount being place in an annuity for next 25 years at 3%, I would only be getting about $2,000 a month from 55 to 80 years old.
With inflation, the real value of the annuity will be less than $2,000 and may not be sufficient for life beyond 55 years old.
How realistic is the return of 5%? Many funds have mentioned returns of higher than 5%, but there are possibilities that the funds may not generate such a return, as there are always up's and down's.
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My reply:
You can read the FAQ in my website, www.tankinlian.com/faq. You can get some useful information that will answer your questions.
I suggest that you re-calculate the figures on the following assumptions:
* the retirement age should be 65 (instead of 55)
* the investment return can be increased to 6% per annum
With the revised assumptions, you will be able to get a higher annuity payment on your retirement. Even after deducting for the effect of inflation (say at 2% per annum), your annuity income should be quite adequate.
You can visit the business center of NTUC Income and talk to an insurance consultant.
I am 37 years old. If I save $20,000 a year for next 18 years at 5% return, I would accummulate about $500,000 when I reach 55 years old.
With this amount being place in an annuity for next 25 years at 3%, I would only be getting about $2,000 a month from 55 to 80 years old.
With inflation, the real value of the annuity will be less than $2,000 and may not be sufficient for life beyond 55 years old.
How realistic is the return of 5%? Many funds have mentioned returns of higher than 5%, but there are possibilities that the funds may not generate such a return, as there are always up's and down's.
------------------------------------
My reply:
You can read the FAQ in my website, www.tankinlian.com/faq. You can get some useful information that will answer your questions.
I suggest that you re-calculate the figures on the following assumptions:
* the retirement age should be 65 (instead of 55)
* the investment return can be increased to 6% per annum
With the revised assumptions, you will be able to get a higher annuity payment on your retirement. Even after deducting for the effect of inflation (say at 2% per annum), your annuity income should be quite adequate.
You can visit the business center of NTUC Income and talk to an insurance consultant.
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