Prudential has just confirmed that it intends to pay US$35.5 billlion (S$50billion) to buy American International Assurance (AIA), the Asian life insurance arm of American International Group (AIG).

This deal will help AIG to pay back some of its US$182.5 billion debt to the US government. Prudential will pay US$25 billion in cash and US$10.5 billion in stocks and other securities for AIA. Prudential will raise the cash of US$25 billion by selling US$20 billion worth of shares and another  US$5 billion by selling bonds. AIG accepted Prudential’s offer since the price offered is much better than the initial public offering of AIA in Hong Kong which could raise for about US$15 billion. Together with the earlier purchase of UOB Life Assurance (now named Prudential Life Assurance) from UOB for $428 million, Prudential will becomes the largest life insurer in Singapore, Hong Kong, Malaysia, Thailand, Indonesia, the Philippines and Vietnam.

There are likely to have some repercussion from this take-over. There may be job losses due to duplicate functions such as Finance and Human Resource.  However, the combined sales force of 7,800 will not be affected. Prudential share price tumbles by almost 20% in just two days in March 2010, amid concern over the price of the deal. Prudential is currently valued at about S$25.8 billion. With the rights issue to be offered, there will be mass dilution to the current share price.

AIA policyholders should not be too concerned on their policy contracts since Prudential is obligated to honour the original contracts.

Be first to comment this article | Add as favourites (0) | Quote this article on your site | Views: 6

NTUC Income Policyholders can expect a surprise extra bonus in 2010 to commemorate its 40th anniversary. Details will be announced in March/April 2010 when the investment results are finalised.

Besides bringing this good news to the policyholders, NTUC Income also posted stellar sales performance in 2009. Income’s weighted life insurance new business premiums grew to $275million last year, up 7 percent from $256 million in 2008. In comparison, the industry contracted by an estimated 14 per cent last year. This result is top compared to Great Eastern Life’s $270 million and Prudential’s $265 million. The weighted premium measure is used by insurers here to benchmark performance and it takes into account just 10% of a single premium and all of a year’s premiums for annual premium plans. 

Be first to comment this article | Add as favourites (0) | Quote this article on your site | Views: 35

The number of people aged over 60 by 2050 is projected to be 1.2 billion, the same population as in China today. This will pose critical economic problem when there are fewer young people in the workforce to support the increasing population of the elderly.

In Singapore, the population of those aged 65 and above is expected to treble to a million by 2030, which is one in every five people.  By 2050, the world’s population of those aged 65 and over will be one in every six people. Japan, Singapore, South Korea and Hong Kong are the four Asian countries among the world’s 10 fastest aging populations.

United Overseas Bank (UOB) announced on 6 Jan 2010 that it has sold its life insurance unit, UOB Life, to British Insurer, Prudential, for $428 million. UOB will instead concentrate on its core banking business. UOB will record a one-time gain of $85 million in FY2010. However, upon completion, UOB, UOB Buana and UOB Thai will enter into a bancassurance agreement to distribute life, accident and health insurance products of the Prudential Group for at least 12 years.

The exising 70,000 UOB Life policies held by 50,000 policyholders will hence be handed over to Prudential’s management.

Be first to comment this article | Add as favourites (0) | Quote this article on your site | Views: 90

Supplementary Retirement Scheme (SRS) is a voluntary saving scheme introduced by the government to encourage Singaporeans to save more for their old age. Singaporeans and foreign workers can open an SRS account at any branches of the 3 SRS Operators - DBS, OCBC and UOB. Participants can then contribute up to $11,475 (for Singaporean, or $26,775 for foreign workers) to SRS at their own discretion yearly.

One immediate benefit for participating in SRS is that you can claim tax relief for contributions made to SRS. Each dollar of SRS contribution will reduce your income chargeable to tax by a dollar. This works out to be a total savings of up to $2,000, depending on your Income Tax Bracket and the SRS contribution. You will need to contribute to the SRS account before 31 Dec of each year in order to enjoy the tax relief in the next year of assessment of income tax.

NTUC Income is celebrating Chinese New Year with the gift of CNY Hamper if you invest with us from now till 31 Dec 2009. The policy will have to be issued by 15 Jan 2010.

For each $10,000 investment in our GrowthLink (Single Premium Investment-Linked Policy), you will get 1 point.

With accumulation of

1) 2 points, you will get $80 worth of hamper,
2) 5 points, you will get $200 worth of hamper.

Hurry now before the promotion ends this year.

Be first to comment this article | Add as favourites (0) | Quote this article on your site | Views: 230

NTUC Income has just launched a new series of Life Stages Funds, called Aim Series Funds.Aim Series is a range of 5 investment funds that helps you to achieve each milestone in your life. It takes the complexity of investment away from you, leaving you free to dream and plan for the next stage in your life.

With Aim Series, you’re free to choose a plan to best meet your needs depending on when you plan to reap the benefits: Aim Now; Aim 2015; Aim 2025; Aim 2035 or Aim 2045.

Eldershield is a long-term care insurance that make a monthly payout to policyholder should he not able to perform 3 out of the 6 Activities of Daily Living: Washing, Dressing, Feeding, Toileting, Mobility and Transferring.

NTUC Income has now replaced the existing ElderShield Care and ElderShield Lifetime Care with PrimeShield.. PrimeShield offers lifetime monthly income benefit of $500, $1000, $1500, $2000 and $2500. The other benefits include:

• Lump sum benefit of 3 times the monthly payout per lifetime
• Dependent care benefit of 25% of the monthly payout per month, up to a maximum of 36 months per lifetime if the policyholder has at least one child of age below 21 years old as of claim date.
• Get well or death benefit of 3 times the monthly payout per lifetime.

For example, if Mr Lee is on Basic ElderShield 300/400 plan and wishes to receive $1000 per month should he suffer from any 3 of the activities of daily living. He has 3 children of age 10, 15 and 22 years old. He will get the following benefits:

Once certified to be severely disabled from the 3 of the 6 activities of daily living, Mr Lee will get a lump sum benefit of $3000 and monthly benefit of $1250 for 3 years. From 4^th year onwards, he will receive $1000 per month for the rest of his life. Once he recovers or passes on, a one-time benefit of $3000 per lifetime will be claimable.

Check with your Insurance advisers now on the procedure to change to PrmeShield.

Starting from this month, CPF Board will begin to offer CPF LIFE to members age 55 and above this year. This first phase of CPF LIFE will be on a voluntary basis, unlike those younger members whereby participation is compulsory.

Members will be placed into one of the four plans, LIFE Balanced Plan (default), LIFE Basic Plan, LIFE Plus Plan and LIFE Income Plan. The LIFE Basic Plan provides for a higher bequest amount at the expense of lower monthly payouts. The LIFE plus Plan give a higher income but lower bequest amount. The LIFE Income Plan offers the highest monthly income but no bequest amount, probably most suitable for members who have no dependents.

With effect from 1 September 2009, all insurance companies will follow the new insurance nomination framework, including insurance cooperative giant, NTUC Income.

NTUC Income, being a cooperative, had its own Section 45 of the Co-operative Societies Act (CSA) to govern the revocable nomination of beneficiaries before 1 September 2009. In the past, the commercial insurance industry has two problems for nominating beneficiaries for their insurance policies bought.

Firstly, when the policyholder has nominated the spouse and/or children as the beneficiaries, Section 73 of the Conveyancing and Law of Property Act (“CLPA”) and Law of Property Act (“CLPA”) will automatically create a statutory trust in favour of the beneficiaries.

The implication is that he will not be able to change nomination subsequently except with the approval of all the existing beneficiaries. Hence, a divorcee cannot change the beneficiaries to his new wife and children without the consent of his ex-wife and/or children from the previous marriage. The creation of such a trust also implies that the policy owner will irrevocably lose all rights and control over the insurance policy concerned, including payouts made when he claims on critical illness or total permanent disability.