Life insurance agents are trained to present strong arguments to get the unsavvy public to buy life and investment-linked policies that pay high commission to the agents. Here are some of the arguments put forward by them against term insurance:
a) Term insurance is for a certain period. After the period is over, you will not have any more life insurance cover.
b) Term insurance covers a fixed sum, which does not keep up with inflation.
These arguments are misleading and do not present an honest picture.
Here are the reasons:
a) You only need life insurance cover when your children still depend on you financially. After 25 years, they have grown up. During this period, you would have accumulated sufficient savings to surpass the sum insured and will not need life insurance any more.
b) If your term insurance covers a level sum, the accumulated savings will be more than adequate to compensate for the effect of inflation. Actually, a decreasing sum insured may be adequate for most people.
The greatest danger of inflation is not on the death benefit, but on the savings in a life insurance policy. A net yield of 2% provided by a life insurance policy is not sufficient to cover inflation. It is important for a policyholder to invest the savings more wisely to get a higher return (say 4% or more) to cover inflation.
A life insurance policy does not provide a fair return, due to the high charges for commission and profit. Many agents know the facts, but they are dishonest in presenting misleading arguments, in the chase for the lucrative commission.
Last edit: 11 years 10 months ago by niadmin. Reason: formatting
Travails with claiming travel insurance
I WENT on a short holiday recently, but unfortunately fractured my left ankle on the day of arrival.
Evacuated by ambulance to the nearest hospital, I was unable to proceed with the rest of my programme.
An immediate return to Singapore was considered but dropped as the surgeon advised against too much movement so soon, and recommended I rest in the hotel.
The other consideration was cost mitigation for the insurers. Sticking with the original return flight would be the "least-cost" option. That decision was well-reasoned, or so I thought.
It turned out that the insurer, Chartis, strictly defines travel as being curtailed only if the insured person flies back immediately. Never mind my condition or that I had acted in good faith to mitigate the costs.
Instead of commending me for choosing the least-cost option, Chartis is insisting it will pay for curtailment of travel only if I had kept strictly to its definition.
Frankly, its stance leaves me wondering if it is just trying its best to avoid payment.
As well as sweeping aside my conscientious efforts at cost mitigation, the insurer did not give the impression of having an orderly internal process.
The claim documents were delivered by hand to forestall any claim of non-receipt. But Chartis claimed it did not receive them.
My follow-up claim for treatment by a traditional physician, hand delivered as well, also never made it to the claims department.
Chartis' reply to my appeal was to regurgitate its definition of travel curtailment, namely, evacuate immediately.
If I had done so against the doctor's orders, and perhaps aggravated the injuries, would Chartis then say I defied the doctor's orders and hence it is not liable for payment? Chiang Meng Lee (Ms)
OMG, my cars are insured under Chartis. Wiill have to change to another insurance comapany
in future and will certainly not use this company when I travel. I miss AIG insurance. Can anyone recommend a good insurance company with a good track record on claims?
[hr]
[Kaypoh 21-09-2012]:
Travails with claiming travel insurance
I WENT on a short holiday recently, but unfortunately fractured my left ankle on the day of arrival.
Evacuated by ambulance to the nearest hospital, I was unable to proceed with the rest of my programme.
An immediate return to Singapore was considered but dropped as the surgeon advised against too much movement so soon, and recommended I rest in the hotel.
The other consideration was cost mitigation for the insurers. Sticking with the original return flight would be the "least-cost" option. That decision was well-reasoned, or so I thought.
It turned out that the insurer, Chartis, strictly defines travel as being curtailed only if the insured person flies back immediately. Never mind my condition or that I had acted in good faith to mitigate the costs.
Instead of commending me for choosing the least-cost option, Chartis is insisting it will pay for curtailment of travel only if I had kept strictly to its definition.
Frankly, its stance leaves me wondering if it is just trying its best to avoid payment.
As well as sweeping aside my conscientious efforts at cost mitigation, the insurer did not give the impression of having an orderly internal process.
The claim documents were delivered by hand to forestall any claim of non-receipt. But Chartis claimed it did not receive them.
My follow-up claim for treatment by a traditional physician, hand delivered as well, also never made it to the claims department.
Chartis' reply to my appeal was to regurgitate its definition of travel curtailment, namely, evacuate immediately.
If I had done so against the doctor's orders, and perhaps aggravated the injuries, would Chartis then say I defied the doctor's orders and hence it is not liable for payment? Chiang Meng Lee (Ms)
Alamak another problem for consumers!
In ST today :
MY FAMILY car has been insured for more than 10 years without any claim, and had accumulated a no-claim discount of 50 per cent.
Recently, the car got into an accident while being driven by my daughter. Although she is a young driver, she has three years of driving experience.
I had to pay an excess of $3,200 for the claim, including the excess for a young driver, and lost the no-claim discount.
My insurance policy is due to expire soon, but NTUC Income has refused to renew it on account of the claim, explaining its decision as "market practice".
I was told to find another insurer. I tried to do so but was rejected or slapped with unfair and unrealistically excessive renewal fees because of the claim.
It is compulsory for a car to be insured before it can be driven on the road.
NTUC Income should know that accidents can happen unexpectedly and that they cannot be avoided. That is why insurance is necessary.
By rejecting my renewal, how does it expect me to find insurance elsewhere? In my case, I have already paid a large amount of excess and lost my no-claim discount. Are these not enough?
The Monetary Authority of Singapore should look into market practices that deprive motorists of compulsory motor coverage. Tan Yau Cher
I was thinking of switching my car insurance from Chartist to NTUC, but now I won't as this case is so unfair. I wont go to AXA insurance either because of the recent Ferrari accident case. Can someone recommend a good car insurance company which is fair , as I dont mind paying a bit more ?
Income defends renewal rejection
Published on Oct 05, 2012
NTUC Income's decision not to renew the motor insurance policy for Mr Tan Yau Cher's family ("No insurance renewal for dangerous driving..."; Wednesday) in reply to Mr Tan's letter ("Don't let insurers leave car owners in renewal fix"; last Saturday) has created much discussion.
Clearly, opinions are divided and we thank the public for sharing their views.
We would also like to explain our decision.
First, the facts.
The policy was not held in Mr Tan's name but an older daughter's name - the policyholder.
The accident happened when his younger daughter was driving the car.
A video provided compelling evidence of absolute recklessness which cannot be ignored.
Generally, when we insure a motor policyholder, we insure the totality of risk and this will include accidents caused by drivers authorised or allowed by the policyholder.
In order to keep the rates of premiums affordable to the larger pool of our motor policyholders - the vast majority of whom are safe drivers - we exclude policyholders whose claims experience is excessively poor due to their own fault.
Mr Tan's older daughter's claims experience falls into this category. Our standard operating procedure is not to invite such cases for renewal.
In his letter, Mr Tan mentioned that other insurers have provided him quotes, albeit with high premiums.
These rates are reflective of the risks associated with unsafe driving behaviour. I would encourage him to accept one of these offers.
However, if Mr Tan's older daughter wishes to continue her insurance with NTUC Income, I invite her to contact us, but we would exclude her younger sister from the coverage.
This is an unusual practice for family cars. However, this is what we need to do so that we can provide an existing policyholder with the choice to insure with us.
Nevertheless, I would like to add that the premiums will still carry a significant loading.
This is necessary to deter anti-selection, the process where we inadvertently attract family units with bad driving behaviour to insure with us.
Such anti-selection would cause our overall premiums to rise - to the detriment of the majority of our motor policyholders.
We welcome this opportunity to explain our decision.
Arising from this, we will make clearer in our motor insurance contracts that if you drive recklessly, you put the renewability of your car insurance at risk. Tan Suee Chieh Chief Executive NTUC Income
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