The bank of my DBS credit card showed the customer service line as 1800 111 1111. When I called this hotline, it goes to the DBS Bank main hotline. I have to answer many confusing questions before I can get to the credit card section. I got lost along the way two times. I gave up and called my customer relationship manager.
It is clear that the user of the credit card wants to ask about his credit card. It is better for DBS to give a number that goes straight to the credit card department.
This type of approach is used by many large organisations. I hope that they will change their system to be more customer friendly. Let us talk to the right people, without going through a maze.
I hope that officers of DBS and other orgaisations with similar systems provide this feedback to their management.
Sunday, May 25, 2008
Exclusions under a medical insurance policy
Dear Mr Tan,
Some time back, I extended my Shield cover to an enhanced one. Because of my hypertension and diabetes conditions, the enhancement came with an exclusion clause to exclude these two conditions and their sequelae. I understood "sequelae" to mean conditions resulting from, or a consequence of, hytension and diabetes.
I would like to know from your experience that when invoking this exclusion clause, whether the onus should be on the insurance company to provide medical certification to prove cause and effect, ie that hypertension and/or diabetes result in or caused another condition for which an insurance claim is being made under the enhanced policy.
Hypertension and diabetes are generally recognised as risk factors for numerous diseases affecting the heart, kidney, liver etc, But it does not mean the these diseases are automatically a sequelae of hypertension or diabetes as there are also other causes.
If such exclusions are meant to have a blanket cover on such common and widespread disease without evidence of connectivity, then you can imagine how "useless" it is to pay to get insured in a nation-wide medical insurance scheme which is meant to be our main protection in the absence of any public-funded scheme. I hope you can illuminate.
REPLY
I suggest that you ask the insurance company to give their explanation on this matter. You can send it to me after getting that explanation. I shall see if it is a reasonable interpretation.
I believe that the onus of proof is on the insurance company, if they wish to reject a claim due to the exclusion clause.
It is important for an insurance company to provide contractual terms that are clear to the consumer.
Some time back, I extended my Shield cover to an enhanced one. Because of my hypertension and diabetes conditions, the enhancement came with an exclusion clause to exclude these two conditions and their sequelae. I understood "sequelae" to mean conditions resulting from, or a consequence of, hytension and diabetes.
I would like to know from your experience that when invoking this exclusion clause, whether the onus should be on the insurance company to provide medical certification to prove cause and effect, ie that hypertension and/or diabetes result in or caused another condition for which an insurance claim is being made under the enhanced policy.
Hypertension and diabetes are generally recognised as risk factors for numerous diseases affecting the heart, kidney, liver etc, But it does not mean the these diseases are automatically a sequelae of hypertension or diabetes as there are also other causes.
If such exclusions are meant to have a blanket cover on such common and widespread disease without evidence of connectivity, then you can imagine how "useless" it is to pay to get insured in a nation-wide medical insurance scheme which is meant to be our main protection in the absence of any public-funded scheme. I hope you can illuminate.
REPLY
I suggest that you ask the insurance company to give their explanation on this matter. You can send it to me after getting that explanation. I shall see if it is a reasonable interpretation.
I believe that the onus of proof is on the insurance company, if they wish to reject a claim due to the exclusion clause.
It is important for an insurance company to provide contractual terms that are clear to the consumer.
Option to stay with the old bonus structure
Dear Mr. Tan,
Just want to thank you for every effort you put in recently to resolve the matter with NTUC Income management. Ideally, I hope that they would grant us to stay on with the old bonus structure, maybe, just to those who had signed to indicate their preference.
At least one thing for sure, after this incident, many people (those who read about it) are cautious when they intend to take up an insurance policy. Nothing is absolute, even the terms are written in black and white. Once again, your effort is appreciated!
FL
Just want to thank you for every effort you put in recently to resolve the matter with NTUC Income management. Ideally, I hope that they would grant us to stay on with the old bonus structure, maybe, just to those who had signed to indicate their preference.
At least one thing for sure, after this incident, many people (those who read about it) are cautious when they intend to take up an insurance policy. Nothing is absolute, even the terms are written in black and white. Once again, your effort is appreciated!
FL
MAS Notice 320
MAS has issued a detailed notice governing the distribution of bonus on participating policies. It is shown here:
http://www.mas.gov.sg/resource/legislation_guidelines/insurance/notices/MAS_Notice_320.pdf
I shall be studying the requirements in detail and will post my explanations of the requirements. This will help us make sure that the disclosures by the insurance companies meet the spirt and intent of the notice.
http://www.mas.gov.sg/resource/legislation_guidelines/insurance/notices/MAS_Notice_320.pdf
I shall be studying the requirements in detail and will post my explanations of the requirements. This will help us make sure that the disclosures by the insurance companies meet the spirt and intent of the notice.
New Benefit Illustration
Life insurance companies are now required to use a new format of Benefit Illustration, based on the projected investment yield of 3.75% and 5.25% per annum. The lower yield of 3.75% reflect the current investment environment, with low yields on bond investments.
Policyholders should be aware that the charges imposed on a life insurance policy to pay for the marketing expenses (e.g. agent commission and sales incentives), administrative expenses and mortality charges (for the life insurance cover) remains to be quite high.
I estimate that the charges can reduce the yield by about 2.5% for an endowment policy and 3.5% by a whole life or critical illness policy.
If the gross yield is 3.75%, the net yield after the charges can be less than 1.5% or 0.5% for a saving over 20 years or longer. If the policy is terminated earlier, the yield will be negative (i.e. the cash value is less than the premiums paid). Read this FAQ:
http://www.tankinlian.com/faq/expense.html
I hope that life insurance companies will reduce their charges and expenses and give a better value to their policyholders under their endowment, whole life or critical illness policies. If you are considering to buy any of these policies, you should ask the insurance adviser to give you the answers to the following questions:
http://www.tankinlian.com/faq/right.html
You should also avoid high cost investment linked policies (ILP), as explained here:
http://www.tankinlian.com/faq/ilp.html
Due to the high charges and low return from a life insurance policy, it is better to buy a low cost term insurance policy and invest your savings in a low cost investment fund, as explained here:
http://www.tankinlian.com/faq/savings.html
Policyholders should be aware that the charges imposed on a life insurance policy to pay for the marketing expenses (e.g. agent commission and sales incentives), administrative expenses and mortality charges (for the life insurance cover) remains to be quite high.
I estimate that the charges can reduce the yield by about 2.5% for an endowment policy and 3.5% by a whole life or critical illness policy.
If the gross yield is 3.75%, the net yield after the charges can be less than 1.5% or 0.5% for a saving over 20 years or longer. If the policy is terminated earlier, the yield will be negative (i.e. the cash value is less than the premiums paid). Read this FAQ:
http://www.tankinlian.com/faq/expense.html
I hope that life insurance companies will reduce their charges and expenses and give a better value to their policyholders under their endowment, whole life or critical illness policies. If you are considering to buy any of these policies, you should ask the insurance adviser to give you the answers to the following questions:
http://www.tankinlian.com/faq/right.html
You should also avoid high cost investment linked policies (ILP), as explained here:
http://www.tankinlian.com/faq/ilp.html
Due to the high charges and low return from a life insurance policy, it is better to buy a low cost term insurance policy and invest your savings in a low cost investment fund, as explained here:
http://www.tankinlian.com/faq/savings.html
Indonesian newspaper writes about life insurance
There was an article in the Kompass newspaper about life insurance. It was written in Indonesian language. My friend translated the key points of the article for me. The journalist wrote these points after interviewing a few consumers:
1. The consumer find the insurance agent to be disturbing their privacy. They keep calling the consumer, when they are no longer welcomed.
2. The consumer finds life insurance products to be complicated and does not understand the explanation by the agent.
3. The agent will keep in close touch with the consumer up to the point of sale. After that, the agent cannot be found.
I was quite surprised at the frankess and independence of the newspaper. They are willing to write a negative report on life insurance, even though it may affect their advertising revenue. My friend said that this paper is highly respected for its journalistic independence.
1. The consumer find the insurance agent to be disturbing their privacy. They keep calling the consumer, when they are no longer welcomed.
2. The consumer finds life insurance products to be complicated and does not understand the explanation by the agent.
3. The agent will keep in close touch with the consumer up to the point of sale. After that, the agent cannot be found.
I was quite surprised at the frankess and independence of the newspaper. They are willing to write a negative report on life insurance, even though it may affect their advertising revenue. My friend said that this paper is highly respected for its journalistic independence.
2006 Earthquake at Jogja
On the way from the airport, I asked the driver how many people were killed during the 2006 earthquake in Jogjakarta. He guessed that it must be 100,000 people, but he was not sure.
I checked Wikipedia. The number is much smaller. The 6.3-magnitude earthquake killed 5,782 people and left some 36,299 persons injured. More than 135,000 houses are damaged, and 600,000 people are homeless.
It is still serious, but the scale is smaller than the Sichuan earthquake in 2008.
I checked Wikipedia. The number is much smaller. The 6.3-magnitude earthquake killed 5,782 people and left some 36,299 persons injured. More than 135,000 houses are damaged, and 600,000 people are homeless.
It is still serious, but the scale is smaller than the Sichuan earthquake in 2008.
Jogjakarta, Indonesia
I stayed in Jogjakarta for the past two days. My last visit was more than 20 years ago, when I also visited Borobodur.
Jogja (the short name of Jogjakarta) is a charming city. All the buildings are less than five stories, as they cannot be taller than the Sultan's palace. There are still many buildings from the colonial era, in Dutch style.
I attended a life insurance event at the Prembanan, which is an old site containing a few Hindu temples. The people are friendly and peaceful. During the 1998 riots in Indonesia, Jogja was peaceful.
The Sultan is also the Governor of Jogja. My Indonesian friend said that he has high integrity. The people respect him very much.
Jogja (the short name of Jogjakarta) is a charming city. All the buildings are less than five stories, as they cannot be taller than the Sultan's palace. There are still many buildings from the colonial era, in Dutch style.
I attended a life insurance event at the Prembanan, which is an old site containing a few Hindu temples. The people are friendly and peaceful. During the 1998 riots in Indonesia, Jogja was peaceful.
The Sultan is also the Governor of Jogja. My Indonesian friend said that he has high integrity. The people respect him very much.
Commodity Prices
Hi Mr. Tan,
I would like to seek your advice on commodity investment during this period. I have bought X commodity fund a few months ago and my gain is around 5%, after paying the 5% sales charge to the bank.
Should I sell off this fund? Should I set a profit target or should I continue monitoring the commodity market and sell it once the commodities prices starts going down?
REPLY
I am not familiar with the timing of commodity prices. I cannot advise you on this matter.
Commodity prices are already at a high level. Some people think that they will go higher due to shortages, high demand, etc. But, there is a risk that it is already over-priced.
In the past, some stock, commodity and property prices have gone beyond their realistic level due to speculative reasons. Remember the dotcom days? When the bubble burst, the investors make a big loss.
I would like to seek your advice on commodity investment during this period. I have bought X commodity fund a few months ago and my gain is around 5%, after paying the 5% sales charge to the bank.
Should I sell off this fund? Should I set a profit target or should I continue monitoring the commodity market and sell it once the commodities prices starts going down?
REPLY
I am not familiar with the timing of commodity prices. I cannot advise you on this matter.
Commodity prices are already at a high level. Some people think that they will go higher due to shortages, high demand, etc. But, there is a risk that it is already over-priced.
In the past, some stock, commodity and property prices have gone beyond their realistic level due to speculative reasons. Remember the dotcom days? When the bubble burst, the investors make a big loss.
Forced to buy other insurance products
Dear Mr. Tan Kin Lian,
I was motivated to write to you as you seem to speak up if an insurance company is doing things that are unfair to their consumers.
My insurance company X recently sent a letter as follows, "We will not renew your Workmen Compensation because you do not have any property insurances with us. If you are interested in insuring other commercial insurance products with us, we will be very willing to assist you."
I called the representative who said that X has decided to stop providing the Workmen Compensation as a standalone product, unless we also buy another commercial property insurance e.g. shop fire or theft. The company was not making money from the Workmen's Compensation, and require a second product as a bundle.
I was very upset as this seems to me that X is trying to force us to buy another product (fire/ theft), knowing full well we are required by law to buy the first product (workmen compensation). The representative said that other insurance companies had adopted this practice as well.
I cannot accept this unfair and unethical practice, especially if the industry players have ganged up to change this.
I wanted to find out if MOM and MAS are aware of and condone this practice. I was directed by a FiDREC officer to call an officer in MAS. The officer insisted that this was just a "bad commercial decision" and MAS cannot interfere.
I find it disappointing that MAS as a regulatory organisation is apparently helpless against bad industry practices. It seems that insurance companies are at liberty to do as they wish. Is there any authority for me to complain to, who will look into this matter?
REPLY
I am sorry that you were not given a satisfactory answer by X, FiDREC or MAS. Do you like to bring this matter up to the newspaper? Maybe, a journalist will be happy to write this story.
In USA, for the classes of insurance that are made compulsory (e.g. motor and worker compensation), the regulator set up a "residual market". Any consumer who is not able to get insurance from the private insurance market can approach the "residual market" to get insurance.
I think that the "residual market" is a better approach, compared to the practice of requiring the consumer to buy another insurance product that may be unnecessary. I hope that MAS will look into this matter.
I was motivated to write to you as you seem to speak up if an insurance company is doing things that are unfair to their consumers.
My insurance company X recently sent a letter as follows, "We will not renew your Workmen Compensation because you do not have any property insurances with us. If you are interested in insuring other commercial insurance products with us, we will be very willing to assist you."
I called the representative who said that X has decided to stop providing the Workmen Compensation as a standalone product, unless we also buy another commercial property insurance e.g. shop fire or theft. The company was not making money from the Workmen's Compensation, and require a second product as a bundle.
I was very upset as this seems to me that X is trying to force us to buy another product (fire/ theft), knowing full well we are required by law to buy the first product (workmen compensation). The representative said that other insurance companies had adopted this practice as well.
I cannot accept this unfair and unethical practice, especially if the industry players have ganged up to change this.
I wanted to find out if MOM and MAS are aware of and condone this practice. I was directed by a FiDREC officer to call an officer in MAS. The officer insisted that this was just a "bad commercial decision" and MAS cannot interfere.
I find it disappointing that MAS as a regulatory organisation is apparently helpless against bad industry practices. It seems that insurance companies are at liberty to do as they wish. Is there any authority for me to complain to, who will look into this matter?
REPLY
I am sorry that you were not given a satisfactory answer by X, FiDREC or MAS. Do you like to bring this matter up to the newspaper? Maybe, a journalist will be happy to write this story.
In USA, for the classes of insurance that are made compulsory (e.g. motor and worker compensation), the regulator set up a "residual market". Any consumer who is not able to get insurance from the private insurance market can approach the "residual market" to get insurance.
I think that the "residual market" is a better approach, compared to the practice of requiring the consumer to buy another insurance product that may be unnecessary. I hope that MAS will look into this matter.
Bad claim service
Dear Mr Tan,
We are having some problem with X. They have proceeded with the 3rd party claim without our nowledge. We are concerned as it will affect our 50% NCD.
Based on our conversation with the claim officer, they said that the claim was $1,700 ($1,400 for repair, $300 for loss of use) which is ridicoulously high for a minor accident. We requested for the official quotation which has not been provided up to now. In fact we are willing to settle out of our own pocket but was initially advise to wait for IDAC report.
How many days does the 3rd party claim? How long does the repair takes? Why is X so generous in the settlement? I asked these questions through the telephone and have not obtained an answer.
Whose interest is X protecting? By paying a higher claim, they will increase our premium.
Out of our frustration, I told the staff that we might not even consider to continue with X. Not surprisingly she reply "Go Ahead!".
I hope that you will advise other motorist to be aware of such situations. A reputable insurance company may not able to protect your interest but take the opportunity to make more "business" out of someone instead.
May I request what is the procedures X takes on a 3rd party claim? Are they allowed to act without the policyholders acknowledge.
REPLY
I am sending your e-mail to the service quality manager of X. I hope that she will reply to you.
We are having some problem with X. They have proceeded with the 3rd party claim without our nowledge. We are concerned as it will affect our 50% NCD.
Based on our conversation with the claim officer, they said that the claim was $1,700 ($1,400 for repair, $300 for loss of use) which is ridicoulously high for a minor accident. We requested for the official quotation which has not been provided up to now. In fact we are willing to settle out of our own pocket but was initially advise to wait for IDAC report.
How many days does the 3rd party claim? How long does the repair takes? Why is X so generous in the settlement? I asked these questions through the telephone and have not obtained an answer.
Whose interest is X protecting? By paying a higher claim, they will increase our premium.
Out of our frustration, I told the staff that we might not even consider to continue with X. Not surprisingly she reply "Go Ahead!".
I hope that you will advise other motorist to be aware of such situations. A reputable insurance company may not able to protect your interest but take the opportunity to make more "business" out of someone instead.
May I request what is the procedures X takes on a 3rd party claim? Are they allowed to act without the policyholders acknowledge.
REPLY
I am sending your e-mail to the service quality manager of X. I hope that she will reply to you.
Waiting for the time to buy a property
Mr. Tan,
We just sold our house prior coming to Singapore. We are renting, while waiting for the right time to buy. We have some money in foreign bank (which gives 3.5% fixed deposit) and another 90K sitting in the saving account with almost no interest. I saw the ad in the newspaper from X about emerging market notes, that lock $ 20,000 for 5 years, with 3.3% p.a and give fixed deposit of 2.65%. Do you think this is a good idea? What about unit trust? Which product do you recommend?
After reading some of your articles, I trust you better than agent selling me their products.
REPLY
I am not familiar with this product from X. Normally, I avoid structured products, for the reasons given in this FAQ:
http://www.tankinlian.com/faq/sinvest.html
You can read this FAQ on investment for the long term:
http://www.tankinlian.com/faq/savings.html
For short term investments, you should accept the current low rate of return.
We just sold our house prior coming to Singapore. We are renting, while waiting for the right time to buy. We have some money in foreign bank (which gives 3.5% fixed deposit) and another 90K sitting in the saving account with almost no interest. I saw the ad in the newspaper from X about emerging market notes, that lock $ 20,000 for 5 years, with 3.3% p.a and give fixed deposit of 2.65%. Do you think this is a good idea? What about unit trust? Which product do you recommend?
After reading some of your articles, I trust you better than agent selling me their products.
REPLY
I am not familiar with this product from X. Normally, I avoid structured products, for the reasons given in this FAQ:
http://www.tankinlian.com/faq/sinvest.html
You can read this FAQ on investment for the long term:
http://www.tankinlian.com/faq/savings.html
For short term investments, you should accept the current low rate of return.
Harrassed over an old case
Hi Mr. Tan
Would be very appreciative if you could advise on the following matter, please.
My wife was involved in a minor accident where her car grazed a pedestrain who was not paying attention when he stepped off the sidewalk at the roundabout a few years ago. My insurer X assessed and accepted that my wife was not at fault (I have on hand various correspondences) and I have been enjoying 50% NCD plus additional NCD protection premium all these past years.
Almost 3 years later, we received a letter from thier lawyer which brusquely requested my wife to go for an interview with the lawyer and bringing all the necessary documents, police reports, pictures etc. These were already provided to X for their assessment earlier. The lawyer warned that failure to comply or cooperate would entitle X to repudiate liability against my wife, leaving my wife personally liable to any damages and costs which may be obtained against her.
Is this the norm for X or their lawyer to go after the policy holder years after they have assessed the policy holder to be not af fault and closed the case?
REPLY
I suggest that you meet with the lawyer and ask this question to the lawyer.
If you feel that you have been unfairly inconvenienced, you can send your feedback to the top management. In the worse case, you can lodge a complain with Fidrec.
http://www.fidrec.com.sg/website/faq.html
Generally, the insurance company should look after the interest of the policyholder and should not give unnecessary trouble and inconvenience to the policyholder.
Would be very appreciative if you could advise on the following matter, please.
My wife was involved in a minor accident where her car grazed a pedestrain who was not paying attention when he stepped off the sidewalk at the roundabout a few years ago. My insurer X assessed and accepted that my wife was not at fault (I have on hand various correspondences) and I have been enjoying 50% NCD plus additional NCD protection premium all these past years.
Almost 3 years later, we received a letter from thier lawyer which brusquely requested my wife to go for an interview with the lawyer and bringing all the necessary documents, police reports, pictures etc. These were already provided to X for their assessment earlier. The lawyer warned that failure to comply or cooperate would entitle X to repudiate liability against my wife, leaving my wife personally liable to any damages and costs which may be obtained against her.
Is this the norm for X or their lawyer to go after the policy holder years after they have assessed the policy holder to be not af fault and closed the case?
REPLY
I suggest that you meet with the lawyer and ask this question to the lawyer.
If you feel that you have been unfairly inconvenienced, you can send your feedback to the top management. In the worse case, you can lodge a complain with Fidrec.
http://www.fidrec.com.sg/website/faq.html
Generally, the insurance company should look after the interest of the policyholder and should not give unnecessary trouble and inconvenience to the policyholder.
Collective Protest - Update 25 May 2007
I just returned from a two day visit to Jogjakarata. I cleared through my mail on the Collective Protest. I now have 537 signatures.
It is short of my target of 1,000 signatures, but has passed the half way mark. I wish to thank policyholders who have made the effort to collect the signatures and send them to me.
If you wish to send more signature, you can continue to do so. You can mail to me, or send it to kinlian@gmail.com.
You can get the Collective Protest from from:
http://www.tankinlian.com/faq/collectiveprotest.html
It is short of my target of 1,000 signatures, but has passed the half way mark. I wish to thank policyholders who have made the effort to collect the signatures and send them to me.
If you wish to send more signature, you can continue to do so. You can mail to me, or send it to kinlian@gmail.com.
You can get the Collective Protest from from:
http://www.tankinlian.com/faq/collectiveprotest.html
Prefer the old bonus distribution
Dear Mr. Tan
I support the Collective Protest against the restructure of bonus, however it is too late to mail you the form, hopes this helps.
Just few weeks ago newspaper was still advertising about the high return NTUC Income payout in the past few years, I was then seriously considering new policy for both my daughters. It is surprise to know that the bonus policy can change overnight. I sincerely hope that Income can revert back to its old bonus distribution policy.
REPLY
You can still mail the signature form to me. I will use it for a future occasion.
I support the Collective Protest against the restructure of bonus, however it is too late to mail you the form, hopes this helps.
Just few weeks ago newspaper was still advertising about the high return NTUC Income payout in the past few years, I was then seriously considering new policy for both my daughters. It is surprise to know that the bonus policy can change overnight. I sincerely hope that Income can revert back to its old bonus distribution policy.
REPLY
You can still mail the signature form to me. I will use it for a future occasion.
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