Author Archive

Posted on August 7, 2010 - by Patrick Lim

A vicious cycle?

I couldn’t have articulated it better myself on Adrian’s point of making co-payment compulsory as it was never the intention of our government to do so when medishield was first introduced in july 1990.

In fact, when i was in aviva’s product committee in the design of an integrated shield plan back in late 2004/early 2005, i stressed this to the management of aviva and the product committee as well.

And when aviva myshield made it appearance in mid-2005 which by itself was radical being the first shield plan to come with ‘as-charged’ benefits, i was pleasantly pleased as punch that the rider when launched, did not cover the deductible of the plan, only the co-insurance portion.

Adrian mentioned that he applauds ntuc-income for being the only shield provider not to provide 100% reimbursement through it’s current rider, the incomeshield assist rider. perhaps this may not be strictly by choice because the incomeshield plus rider (covers 100% deductible and co-insurance) was withdrawn on november 16, 2007 due to what mr lawrence wong, the general manager of ntuc-income cited as loss-ratio and the new incomeshield assist rider being introduced on the same day. Read more…

Posted on April 18, 2010 - by Patrick Lim

Extending Dependents’ Protection Scheme

mr david kwok’s letter on extending the dps (dependents’ protection scheme) appeared in the st forum last wednesday:

Dependants’ scheme

‘The DPS should be extended to age 80 and beyond.’

MR DAVID KWOK: ‘The Dependants’ Protection Scheme (DPS) is a low-cost insurance scheme which is beneficial to all Singaporeans, especially those in the low-income group. The cover ceases when a person reaches the age of 60. With many Singaporeans living past 75, the DPS should be extended to age 80 and beyond.’

today, mr chang long kiat, director (housing and healthcare), cpf board responded:

last wednesday, mr david kwok suggested raising the current dependents’ protection scheme (dps) age limit of 60 years old to 80 and beyond (’dependents’ scheme).

the dps is a low-cost term insurance scheme aimed at helping young dependents with a sum of money to tide over the initial difficult period in the event of a cpf member’s permanent incapacity or death.

if dps were to be extended beyond 60, members who wish to be covered will have to pay substantially higher premiums. for example, annual premiums for cover between the ages of 60 and 65 will be more than thrice that of cover between the ages of 55 and 60.

members aged 60 and above will be better served by saving this money for their retirement needs instead of purchasing further cover, especially since their children are likely to have already commenced working and no longer depend on them for income.

members who wish to purchase life insurance beyond age 60 can still do so from private insurers.

my comments:
Read more…

Posted on February 6, 2010 - by Patrick Lim

madam sabrina tan

ST ONLINE FORUM – Hit Hard by insurance policy termination

I BOUGHT three policies from Prudential for my children 15 years ago. Recently, due to a need for cash, I decided to terminate one of the policies.

To my shock and disappointment, the amount I am getting back upon surrendering the policy equates to less than 50 per cent of my contribution in the last 15 years.

I can understand if the early termination results in an 80 per cent return, but 50 per cent?

The customer service officer told me that given the crisis last year, policyholders did not have good bonuses and therefore the drop in value. So my questions are:

How can the year’s bonus affect 50 per cent of my investment because a good bonus does not double my principal sum.

Is there an organisation in Singapore that ensures that policyholders are being protected?

As much as there are risks, what about those who have invested for 30 years hoping to get a good return only to be given the same answer?

Will the authorities please look into this so all of us who hope to retire well by investing in insurance policies will not lose a substantial amount of our hard-earned cash.

Sabrina Tan (Mdm)
Read more…

Posted on October 29, 2009 - by Patrick Lim

Aviva – guaranteed acceptance for myshield?

Just this week, let me share a very interesting experience from a meeting with a prospect who is also a reader of my blog intrigued by my posting on the guaranteed acceptance for Aviva’s MyShield through the option of moratorium underwriting.

But boy, oh boy, I came away from our meeting filled with more than just a red face fully flushed with embarrassment!!!

what happened?

I have to apologise profusely to this prospect for being unable to help him receive guaranteed acceptance for aviva’s myshield even through the option of moratorium underwriting. Yes, you did not read wrongly on the ‘no-go’ for this prospect even through the option of moratorium underwriting for aviva’s MyShield.

Why? Read more…

Posted on October 8, 2009 - by Patrick Lim

One policyholder’s endorsement of his own regular premium ILP

Investment-linked products beneficial in the long term

I REFER to last Saturday’s Forum Online letter by Mr Larry Haverkamp, ‘Cheaper to invest in unit trust than regular-premium investment-linked products’.

It is true that all front-end loaded investment-linked products (ILPs) will invest only a small percentage of premiums paid in the initial years of the policy.

But it is also true that some ILPs do invest more of the premiums paid over the years, even exceeding the premiums paid in later years.

Mr Haverkamp focused all attention on the ILP charges, as well as the single benefit of investing in unit trusts, that is, incurring much lower charges.

But he failed to mention or realise the valuable insurance benefit the plan provides, which is the other reason why ILPs are an attractive product, as opposed to buying a standalone term policy and investing in unit trusts. Read more…

Posted on September 10, 2009 - by Patrick Lim

TM Asia Life – never heard of this company!

Today, one of my company’s advisers related to me on the encounter with her client who has an existing insurance agent. Ms T (my company’s adviser) was given the challenge to source for a more competitively priced limited premium whole life plan to compare with what has been proposed to her client by her tied agent.

Ms T responded by recommending TM  Asia life’s TM  legacy (LP) plan which is a limited premium participating whole of life plan.

The similar participating limited premium whole life plan proposed by her client’s insurance agent is from one of the big 4 insurers and it was no surprise that TM Asia life’s TM legacy (lp) pricing of premiums came in lower, much lower which was Ms T’s value add proposition to her client.

However, Ms T’s client remarked that she has never heard of TM Asia Life.

This statement from Ms T’s client may be interpreted to have at least 3 implications:

a.TM  Asia Life is a new company
b. TM  Asia Life is a small company and
c. TM  Asia Life may not be financially stable and or strong

My comments:
(more…)

Posted on September 5, 2009 - by Patrick Lim

Aviva – Moratorium underwriting (2)

The following letter is published in the forum page of Wednesday’s  edition of the straits times:

Parents further distraught by MediShield exclusion letter

MY FIRST child was born with suspected cysts in her lungs, according to the paediatrician and the paediatric surgeon who monitored her. At the same time, my wife and I were told that new laws offered MediShield coverage for babies like mine.

We duly filled the requisite forms for coverage and expected possible exclusions for my daughter’s condition. Two months later, the Central Provident Fund (CPF) Board denied our daughter MediShield coverage, citing the higher insurance risk posed by her pre-existing health condition.

We were flabbergasted, given the promise from the Health Ministry that every Singaporean will enjoy basic MediShield coverage unless he or she chooses to opt out.

The least we expected was basic MediShield coverage, with an exclusion for our daughter’s pre-existing condition. In fact, we were even prepared to pay higher premiums.

All parents want healthy babies. Having a baby born with some health complications is a tormenting experience, be it financially or mentally.

While the CPF Board suggested that we reapply pending treatment and confirmation of our daughter’s condition, the bluntness of its reply was cold comfort and the last thing we expected as first-time parents burdened by the anxiety of our daughter’s condition, which was diagnosed during pregnancy.

Leslie Ong
straits times forum page

my comments:
Read more…

Posted on July 26, 2009 - by Patrick Lim

Is The Customer Always Right?

Yesterday, I learnt another real life lesson which I hope will NEVER ever occur again in terms of meeting or exceeding my client’s expectations.

A client and fellow church member (for the record, I knew him before I knew he was worshipping in our church) wished to take up another insurance policy.  This client is more than a client to me because all of his and his family’s wealth protection portfolio has been placed with me together with a big chunk of his life savings into my recommended wealth accumulation portfolio which by the way, is still very much in the black at this point in time.

Because he did not wish for any advice on the insurance policy of his choice, he ticked off option 4 in the kyc forms which states:

“I do not wish to receive any advice from my fa representative.”

because of this, I submitted his formal application to the insurer for underwriting going against my sense of discretion and better judgement.

and the result of the underwriting?

It went against our (both my client and myself) expectations! Read more…

Posted on May 5, 2009 - by Patrick Lim

Financial advice or lack of it?

This week, I met up with a young couple. and their latest family member was a boy just delivered some months earlier.

In reviewing their insurance portfolio, the integrated shield plan recommended by their financial adviser was Aviva’s myshield with myshield plus rider. However, one of the biggest gaps uncovered was a lack of disability income plans for both husband and wife.

As this family has chosen Aviva’s integrated shield combo and full medical underwriting, I was curious as to why they did not consider the other option of moratorium underwriting which is exclusive to Aviva because this option is not available with the other shield providers, namely AIA, great eastern life, NTUC-income and Prudential.

What was the answer?

Because their financial adviser did not inform them of this other option.

huh?

Yes, their answer may or may not be surprising but to me, this may be tentamount to incomplete advise as the moratorium option is an important consideration and doubly significant because it is only available from Aviva.

and why no recommendation of disability income plans?

their financial adviser did not even mention this solution to them.

huh?

yes, one more louder huh? from me. Read more…

Posted on March 21, 2009 - by Patrick Lim

Aviva’s SAF group insurance scheme

This week, I met up with a prospect who wanted a quick review and advice on his insurance portfolio.

This young man in his mid 20s told me he chanced to come across my blog and subsequently, prompted him to email me with his request.

His portfolio consisted of a basic MediShield plan, an endowment plan and Aviva’s group insurance scheme with major illness cover which provided the cornerstone of his insurance portfolio with the maximum sum assured taken up at $400,000 and $300,000 for death/accidental death/TPD and 30 CI coverage respectively.

My comments:

After giving my recommendations which includes upgrading his basic MediShield plan to an ‘as-charged’ integrated shield plan and a disability income solution, I had to sound him out on his SAF group insurance scheme and major illness cover with the following significant pointers contained in the policy wordings:

a. It is a yearly renewable group insurance plan
b. SAF group insurance scheme and major illness cover expires at age 65 and age 70 respectively
c. Major illness cover will be automatically dailed down to the maximum sum assured of $100,000 after age 65
d. Premiums for major illness cover will be based on attained age on an
escalating basis from age 66 to age 70 (not in policy wordings). Read more…