A friend, a veteran in the insurance industry and now happily retired, wrote to me after he read my three postings: "How an insurer mess it up for me", "Why must motor insurers be allowed to have it both ways", and "Market value: What's that?".
He commented: "I agree with you that your insurers did a lousy job in your case in settling the third party claim. I suppose that in their anxiety to save legal costs (if the claim were disputed unsuccessfully) they took what they considered the most economical option, without investigating thoroughly.
"This, in my view, is lacking in professionalism and to some extent is a sad reflection of the state of affairs in the industry.
"From my own past experience, most Claims personnel have no legal training and they are there to manage as best as they could, often arriving at decisions subjectively with the sole objective of saving money for the company.
"Only in major cases where the claim amounts run into tens of thousands of dollars would their lawyers be called in or the top management being involved.
"On the subject of premium increase ,I agree with you too that there is no transparency. During my days, there was what was called a Tariff (which all insurers are obliged to use) and although this was a cartel, motorists at least knew exactly what basic premium they had to pay and if there were premium 'loadings'' for poor claims experience etc at least they knew exactly too what loading was demanded.
"If they didn't like it they could shop around for another insurer who might be prepared to charge a lower premium loading ( the basic premium always remaining unchanged).
"In today's free market environment,which supposedly encourages better competition for consumers' benefit, no one knows exactly how premiums are arrived at from one insurer to the next. Hence, as you've concluded there's no transparency absolutely!
"As for the authorities, you can forget about their taking action to regulate insurers insofar as premium charges are concerned. The main supervisory role of MAS nowadays is to supervise the financial health of insurers and professional misconduct.
"Where premiums are concerned it is the avowed policy of the government to allow market forces to reign supreme. This is supposed to be, like many other things, good for the consumers. They cannot turn the clock back!
"The fact that year in year out the motor insurance industry shows underwriting losses (audited figures) does not suggest that insurers on the whole are having an easy time.
"Compare this to the days when motor insurance premium was Tariffed. The Tariff rates were implicitly approved by the authorities and any general increase or changes to the rating had to be approved by the authorities, and such increases had to be justified with statistics from the industry.
"I suppose if the general body of motorists can make out a case to the authorities, of profiteering by insurers or cartelling, this might persuade them to do something."
Those are indeed words of wisdom from one who had seen how the industry operated from the inside.
I hope those who have a genuine interest in fair play for not just the policy-holders but also the players in the insurance industry would heed his words and take the necessary action.
Thursday, April 8, 2010
Wednesday, April 7, 2010
Overheard in the first-class lounge of Singapore Airlines
Media consultant Peter Ong, who contributed to the post, Knowledge gap at Tang's, has more to say about his short stopover last week:
"Last Sunday (April 4), while waiting in the Singapore Airlines' first class lounge at T3, i was shocked to overhear the bartender condemning Australians out of hand to two passengers, apparently Singaporeans.
"He said something like: "Australians don't like to work, especially on weekends. They prefer to booze."
"Being an Australian citizen, I chirped in: "That's not true at all. I live there and I know for sure they work as hard, if not harder than Singaporeans."
"But my point is this: the Singapore Airlines staff should never say such a thing within earshot of other passengers, some of whom may well be Australians who would definitely be offended.
"Singapore Airlines should remind its staff not to badmouth other people and countries, especially those it flies to.
"Boo to that bartender, whom i noticed, closed his counter a good 5 minutes before official closing time!
"Boo, too, to the GST refund counter at T3.
"While queuing for my refund, I noticed there was only one girl manning the counter. And there were at least 15 people waiting in line. There was no attempt to speed things up, nor call for help from another colleague. I waited for at least 12 minutes before I was served.
"Imagine the 10 or 12 others behind me! Would they miss their flight?
"But bouquets to the buggy driver who picked me and another passenger up from the lounge for the long ride to the gates. He was super efficient, coming up to get us well before time.
"Bouquets too, to the police officers and staff manning the gates. Super efficient, as always!"
*** LATEST
Mr Dzuraimi Mohamad Taib, Singapore Airlines' Customer Affairs Manager has responded to the feedback. In an email, he said:
"Thank you for your feedback on 8 April regarding Mr Peter Ong’s bad
experience at the SilverKris First Class lounge on 4 April.
"We are sorry to learn about the bartender’s inappropriate remarks. May I assure you that we have highlighted this to the Manager Premium Passenger Services for counseling of the staff concerned."
"Last Sunday (April 4), while waiting in the Singapore Airlines' first class lounge at T3, i was shocked to overhear the bartender condemning Australians out of hand to two passengers, apparently Singaporeans.
"He said something like: "Australians don't like to work, especially on weekends. They prefer to booze."
"Being an Australian citizen, I chirped in: "That's not true at all. I live there and I know for sure they work as hard, if not harder than Singaporeans."
"But my point is this: the Singapore Airlines staff should never say such a thing within earshot of other passengers, some of whom may well be Australians who would definitely be offended.
"Singapore Airlines should remind its staff not to badmouth other people and countries, especially those it flies to.
"Boo to that bartender, whom i noticed, closed his counter a good 5 minutes before official closing time!
"Boo, too, to the GST refund counter at T3.
"While queuing for my refund, I noticed there was only one girl manning the counter. And there were at least 15 people waiting in line. There was no attempt to speed things up, nor call for help from another colleague. I waited for at least 12 minutes before I was served.
"Imagine the 10 or 12 others behind me! Would they miss their flight?
"But bouquets to the buggy driver who picked me and another passenger up from the lounge for the long ride to the gates. He was super efficient, coming up to get us well before time.
"Bouquets too, to the police officers and staff manning the gates. Super efficient, as always!"
*** LATEST
Mr Dzuraimi Mohamad Taib, Singapore Airlines' Customer Affairs Manager has responded to the feedback. In an email, he said:
"Thank you for your feedback on 8 April regarding Mr Peter Ong’s bad
experience at the SilverKris First Class lounge on 4 April.
"We are sorry to learn about the bartender’s inappropriate remarks. May I assure you that we have highlighted this to the Manager Premium Passenger Services for counseling of the staff concerned."
Monday, April 5, 2010
Knowledge gap at Tang's
Media consultant and ex-Singaporean Peter Ong, a friend from Australia, dropped by here over the weekend on his way home from South Africa where he has been doing consultancy work with a newspaper there.
Apart from touching base with his son, grandson and other family members, he couldn't resist doing a bit of shopping. So he went to Tang's on Sunday (April 4) to see whether he could part with some of his money.
His email to me started like this: "I am appalled at the lack of knowledge of many sales assistants in Singapore, particularly those at the big department stores."
Then he went on to give an example: "Yesterday, Sunday april 4, I was at Tang's when I saw an automatic watch winder. Being a watch collector, I wanted to find out more about the winders which are supposed to keep your automatic watches going without you having to wear them.
"When I asked the girl manning the counter selling Mitch & Marc watch winders where the movement was from, she said "Australia".
"Indeed, Mitch & Marc is an Australian brand of fashion goods, but it was obvious that she did not undertsand the difference between the brand and the internal workings of the winder. Thereupon, I explained to her what I wanted to know. And again she said "Australia".
"I said: "I know this is an Australian brand. I want to know exactly where the mechanism for the winder is from."
"She just did not know. Worse still, there was no attempt whatsoever to find out.
"Result? I walked away.
"Each of these automatic winders costs anything from $1,000 to several thousand dollars. If Tang's wants to sell any of them, they should teach their staff to answer questions customers like me may have.
"Contrast this to sales assistants in Australia where I live, or Europe or the USA where your every question is answered happily and knowledgeably and you begin to understand how frustrating it is to shop in Singapore."
As far as I know, Tang's is reputed to have a team of helpful and friendly sales staff. However, my friend Peter's experience shows that upgrading is clearly needed.
In a knowledge-based society, customers have become more demanding in their quest for technical details. On their part, retail personnel and management must respond urgently --- or simply fade away.
Apart from touching base with his son, grandson and other family members, he couldn't resist doing a bit of shopping. So he went to Tang's on Sunday (April 4) to see whether he could part with some of his money.
His email to me started like this: "I am appalled at the lack of knowledge of many sales assistants in Singapore, particularly those at the big department stores."
Then he went on to give an example: "Yesterday, Sunday april 4, I was at Tang's when I saw an automatic watch winder. Being a watch collector, I wanted to find out more about the winders which are supposed to keep your automatic watches going without you having to wear them.
"When I asked the girl manning the counter selling Mitch & Marc watch winders where the movement was from, she said "Australia".
"Indeed, Mitch & Marc is an Australian brand of fashion goods, but it was obvious that she did not undertsand the difference between the brand and the internal workings of the winder. Thereupon, I explained to her what I wanted to know. And again she said "Australia".
"I said: "I know this is an Australian brand. I want to know exactly where the mechanism for the winder is from."
"She just did not know. Worse still, there was no attempt whatsoever to find out.
"Result? I walked away.
"Each of these automatic winders costs anything from $1,000 to several thousand dollars. If Tang's wants to sell any of them, they should teach their staff to answer questions customers like me may have.
"Contrast this to sales assistants in Australia where I live, or Europe or the USA where your every question is answered happily and knowledgeably and you begin to understand how frustrating it is to shop in Singapore."
As far as I know, Tang's is reputed to have a team of helpful and friendly sales staff. However, my friend Peter's experience shows that upgrading is clearly needed.
In a knowledge-based society, customers have become more demanding in their quest for technical details. On their part, retail personnel and management must respond urgently --- or simply fade away.
To save or not to save?
Ling, a mother of two, is confused over what OCBC is trying to do in its recent promotion.
Her story: "OCBC recently launched a Happy Savings Draw to encourage fresh cash deposits. For every $5,000 cash deposit over the counter you are entitled to an instant sure-win lucky draw. Among the prizes are Old Chang Kee Curry puffs, $5 Popular vouchers and $20 Robinson vouchers plus a final draw where depositors stand a chance to win $250,000.
"Fair enough - these are some perks to encourage savings and to reward their customers for banking with them.
"Next, from April 1, it started to implement a service charge whereby from anything above $30k, there is a fee of $5 for every $10k deposited or part thereof over the counter. So I am puzzled -- for $5k you are rewarded but for anything above $30k you are penalised.
"In the end, what it really means is that we are paying for our own curry puffs, Popular vouchers and Robinson's vouchers.
"OCBC, please tell us exactly what you want -- to save with your bank or not to?"
*LATEST ... OCBC replies:
Dear Ling,
We refer to your posting regarding the S$5 handling fee that OCBC Bank levies for deposits of more than S$30,000, made at our branches.
We wish to clarify that the handling fee applies to bulk cash deposits only, as more time and resources are required to sort and count the notes and coins.
This fee does not apply to non-cash deposits and we do encourage our customers to make deposits for larger amounts in the form of cheques or cashier’s orders.
Thank you for your support and interest in OCBC Bank. Indeed, our Happy Savings Draw is designed to encourage Singaporeans to save and be rewarded for their efforts. We invite you to visit www.ocbc.com/HappySavings to check out the latest Happy Savings activities.
Regards,
Ms Chng Bee Leng
Head, Deposits
OCBC Bank
Her story: "OCBC recently launched a Happy Savings Draw to encourage fresh cash deposits. For every $5,000 cash deposit over the counter you are entitled to an instant sure-win lucky draw. Among the prizes are Old Chang Kee Curry puffs, $5 Popular vouchers and $20 Robinson vouchers plus a final draw where depositors stand a chance to win $250,000.
"Fair enough - these are some perks to encourage savings and to reward their customers for banking with them.
"Next, from April 1, it started to implement a service charge whereby from anything above $30k, there is a fee of $5 for every $10k deposited or part thereof over the counter. So I am puzzled -- for $5k you are rewarded but for anything above $30k you are penalised.
"In the end, what it really means is that we are paying for our own curry puffs, Popular vouchers and Robinson's vouchers.
"OCBC, please tell us exactly what you want -- to save with your bank or not to?"
*LATEST ... OCBC replies:
Dear Ling,
We refer to your posting regarding the S$5 handling fee that OCBC Bank levies for deposits of more than S$30,000, made at our branches.
We wish to clarify that the handling fee applies to bulk cash deposits only, as more time and resources are required to sort and count the notes and coins.
This fee does not apply to non-cash deposits and we do encourage our customers to make deposits for larger amounts in the form of cheques or cashier’s orders.
Thank you for your support and interest in OCBC Bank. Indeed, our Happy Savings Draw is designed to encourage Singaporeans to save and be rewarded for their efforts. We invite you to visit www.ocbc.com/HappySavings to check out the latest Happy Savings activities.
Regards,
Ms Chng Bee Leng
Head, Deposits
OCBC Bank
Saturday, April 3, 2010
Quarterly reporting
How time whizzes by! I have been at this for over three months, but it seems like it was only last week that I started blogging. I must confess that I am now a little addicted to it.
I am also heartened by the kind comments that I have received from my friends. Here are three of them:
"I think it is a great idea. I first mooted this idea as a weekly page or even column, to the ST. It fell on deaf ears. So I'm so glad u have decided to start this blog." --- May Sng.
"Heard about your blog and spent part of the weekend reading it...impressive! am glad someone is taking shoddy Singapore service staff to task." --- Carl Skadian.
"Great stuff! Just read your blog. I'm impressed with the responses you've been receiving. Now that's journalism in action! Will certainly send you any encounters of good and bad service." --- Lulin Reutens.
Now that I have sufficiently patted myself on the back :), I will move on to my quarterly reporting.
Top of my list for BOUQUET awards : Health Minister Khaw Boon Wan/Ministry of Health. I am so impressed with their swift and to-the-point responses to my comments and questions that I am encouraged to post more stuff on their blog. Mr Khaw has indeed set a very high standard for his colleagues in the other ministries to emulate.
Others who deserve a BOUQUET (not in any particular order) are:
* NTUC FairPrice (responded promptly and positively)
* ICA (outstanding service)
* Volkswagen (excellent service)
* Canon (prompt and positive response)
* Al Forno Italian Restaurant (prompt response)
* SingPost (prompt response and made changes)
* Samsung (excellent service)
* Shabu Shabu Gen (excellent service)
* Novita (good service)
* NUH Aesthestic Plastic Surgery Centre (excellent service)
* Norton (good service).
I must qualify here that some of those who were the recipients of our complaints are getting a bouquet now because they responded promptly to our feedback . I am assuming that they have learnt their lesson and have taken steps to improve their service.
The following are the BOO-QUET recipients:
* Trans Cab (no response to feedback);
* Housing Board (no response to feedback);
* Nokia (responded but problem not fully resolved);
* FCUK (replacement shirt had colour run as well);
* Royal Sun Alliance (lack of courtesy);
* StarHub (no response to feedback);
* Shangri-La Bangkok (no response to feedback).
Thank you, everyone, for contributing. And please remember to pay particular attention to the good service that you also encounter and give your feedback.
I am also heartened by the kind comments that I have received from my friends. Here are three of them:
"I think it is a great idea. I first mooted this idea as a weekly page or even column, to the ST. It fell on deaf ears. So I'm so glad u have decided to start this blog." --- May Sng.
"Heard about your blog and spent part of the weekend reading it...impressive! am glad someone is taking shoddy Singapore service staff to task." --- Carl Skadian.
"Great stuff! Just read your blog. I'm impressed with the responses you've been receiving. Now that's journalism in action! Will certainly send you any encounters of good and bad service." --- Lulin Reutens.
Now that I have sufficiently patted myself on the back :), I will move on to my quarterly reporting.
Top of my list for BOUQUET awards : Health Minister Khaw Boon Wan/Ministry of Health. I am so impressed with their swift and to-the-point responses to my comments and questions that I am encouraged to post more stuff on their blog. Mr Khaw has indeed set a very high standard for his colleagues in the other ministries to emulate.
Others who deserve a BOUQUET (not in any particular order) are:
* NTUC FairPrice (responded promptly and positively)
* ICA (outstanding service)
* Volkswagen (excellent service)
* Canon (prompt and positive response)
* Al Forno Italian Restaurant (prompt response)
* SingPost (prompt response and made changes)
* Samsung (excellent service)
* Shabu Shabu Gen (excellent service)
* Novita (good service)
* NUH Aesthestic Plastic Surgery Centre (excellent service)
* Norton (good service).
I must qualify here that some of those who were the recipients of our complaints are getting a bouquet now because they responded promptly to our feedback . I am assuming that they have learnt their lesson and have taken steps to improve their service.
The following are the BOO-QUET recipients:
* Trans Cab (no response to feedback);
* Housing Board (no response to feedback);
* Nokia (responded but problem not fully resolved);
* FCUK (replacement shirt had colour run as well);
* Royal Sun Alliance (lack of courtesy);
* StarHub (no response to feedback);
* Shangri-La Bangkok (no response to feedback).
Thank you, everyone, for contributing. And please remember to pay particular attention to the good service that you also encounter and give your feedback.
Thursday, April 1, 2010
Market value...what's that???
After my friend Gilbert read my posting, "Why must motor insurers have it both ways", he emailed me to suggest that I say something about "market value" insurance.
He says: "Notice how they charge you a premium for X $ for the value of your car which is based on market price."
"So what is the market value in dollars and cents that determines the premium?" he asks.
Gilbert makes a valid point. And the answer is very simple: Only the insurer knows what the market value is and he decides. The car owner has no say...absolutely.
Long gone are the days when you can determine the value of your car and have it insured accordingly.
If I remember correctly, the motor insurance industry did away with that because it affected the premiums that they could collect.
This was how it used to work: for example, if you valued your car at $100,000, you would pay the premium based on that amount. The following year, upon renewal, you could lower the value to, say, $80,000 because of depreciation. That way, your premium was reduced as you were insuring it for a smaller amount.
Then, lo and behold, the insurers suddenly started using the "market value" method of insuring our vehicles. The change, sadly, did not give rise to any public debate or cause a stir.
Personally, I do not have a problem with this "new" method if the insurers could state categorically the market value of our cars at the point of policy renewal.
This is only fair because, by not doing so, your fate is left totally in the hands of the insurers should there be a claim.
Also, with knowledge of the proposed insured value, one could have an idea whether one is paying a reasonable premium by shopping around for quotes from other insurers.
Short of being pressured by the authorities, it is highly unlikely that our motor industry would return to the old method of insuring our vehicles.
Consider this: If insurers can insure a house against fire for a fixed sum of money, I see no reason why they cannot do the same for vehicles. Isn't it quite obvious there is something terribly wrong?
Why should anyone be happy if he has to pay more in premium each year knowing full well that the value of his asset has gone down in value???
He says: "Notice how they charge you a premium for X $ for the value of your car which is based on market price."
"So what is the market value in dollars and cents that determines the premium?" he asks.
Gilbert makes a valid point. And the answer is very simple: Only the insurer knows what the market value is and he decides. The car owner has no say...absolutely.
Long gone are the days when you can determine the value of your car and have it insured accordingly.
If I remember correctly, the motor insurance industry did away with that because it affected the premiums that they could collect.
This was how it used to work: for example, if you valued your car at $100,000, you would pay the premium based on that amount. The following year, upon renewal, you could lower the value to, say, $80,000 because of depreciation. That way, your premium was reduced as you were insuring it for a smaller amount.
Then, lo and behold, the insurers suddenly started using the "market value" method of insuring our vehicles. The change, sadly, did not give rise to any public debate or cause a stir.
Personally, I do not have a problem with this "new" method if the insurers could state categorically the market value of our cars at the point of policy renewal.
This is only fair because, by not doing so, your fate is left totally in the hands of the insurers should there be a claim.
Also, with knowledge of the proposed insured value, one could have an idea whether one is paying a reasonable premium by shopping around for quotes from other insurers.
Short of being pressured by the authorities, it is highly unlikely that our motor industry would return to the old method of insuring our vehicles.
Consider this: If insurers can insure a house against fire for a fixed sum of money, I see no reason why they cannot do the same for vehicles. Isn't it quite obvious there is something terribly wrong?
Why should anyone be happy if he has to pay more in premium each year knowing full well that the value of his asset has gone down in value???
Why must motor insurers be allowed to have it both ways
Do you know you can insure against the loss of your No-Claim Bonus (NCB) in your motor insurance policy in the event of an accident? Many people do not and are quite excited when they are told about it.
But do not for one moment think that having this protection in your policy means that your premium will stay intact or, at most, increase by a minimal amount, particularly after you have been involved in an accident that may not be totally your fault.
When you are in such a situation, may God help you, because your fate is really in the hands of your insurance company and there is very little you can do about it.
I was in that kind of a dilemma in February this year when my wife's car insurance came up for renewal. The insurer, Royal and Sun Alliance (yes, it is same company), jacked up the premium by more than 200 per cent, justifying it by saying that it had paid out more than $9,000 for "own damage" and had reserved another $9000-plus for third party damage.
I was puzzled by the logic of the increase, so I made an appeal to RSA on two grounds. My email said:
"Firstly, my wife's insurance policy had a no-claim bonus protection. However, with the proposed huge increase in premium, RSA has in fact made a mockery of this protection. What's the point of paying for this protection when the company can wily nily do whatever it wants in terms of premium?
"Secondly, RSA has slapped on the extra premium without giving due consideration to the circumstances of her accident. She was not at fault. The least RSA could have done for its client was to first establish which party was liable instead of assuming that she was to blame and be made to pay the penalty."
The appeal succeeded in bringing down the premium by a few hundred dollars but it was still an increase of more than 100%. There was also a condition attached in the new proposal -- my wife could not switch insurance cover to another company since she had already made a claim. But if she did, her NCB would be reduced to just 20%.
That seems like a cartel at work. I wonder what the Competition Commission of Singapore would say if they knew about it. I will certainly ask them.
As the renewal deadline drew nearer, my wife had no choice but to agree to the new proposal. To help reduce the premium amount further, I advised her to drop her coverage for young drivers and usage of own workshop in the event of an accident.
Moral of the story? The NCB protection coverage will not stop your premiums from skyrocketing because the insurers now have it both ways -- they collect premiums for NCB protection and if you are unfortunate to meet with an accident, they just push up your premiums sky-high without a care about your NCB protection. Sigh!
BOO-QUET for the motor insurance industry!!!
But do not for one moment think that having this protection in your policy means that your premium will stay intact or, at most, increase by a minimal amount, particularly after you have been involved in an accident that may not be totally your fault.
When you are in such a situation, may God help you, because your fate is really in the hands of your insurance company and there is very little you can do about it.
I was in that kind of a dilemma in February this year when my wife's car insurance came up for renewal. The insurer, Royal and Sun Alliance (yes, it is same company), jacked up the premium by more than 200 per cent, justifying it by saying that it had paid out more than $9,000 for "own damage" and had reserved another $9000-plus for third party damage.
I was puzzled by the logic of the increase, so I made an appeal to RSA on two grounds. My email said:
"Firstly, my wife's insurance policy had a no-claim bonus protection. However, with the proposed huge increase in premium, RSA has in fact made a mockery of this protection. What's the point of paying for this protection when the company can wily nily do whatever it wants in terms of premium?
"Secondly, RSA has slapped on the extra premium without giving due consideration to the circumstances of her accident. She was not at fault. The least RSA could have done for its client was to first establish which party was liable instead of assuming that she was to blame and be made to pay the penalty."
The appeal succeeded in bringing down the premium by a few hundred dollars but it was still an increase of more than 100%. There was also a condition attached in the new proposal -- my wife could not switch insurance cover to another company since she had already made a claim. But if she did, her NCB would be reduced to just 20%.
That seems like a cartel at work. I wonder what the Competition Commission of Singapore would say if they knew about it. I will certainly ask them.
As the renewal deadline drew nearer, my wife had no choice but to agree to the new proposal. To help reduce the premium amount further, I advised her to drop her coverage for young drivers and usage of own workshop in the event of an accident.
Moral of the story? The NCB protection coverage will not stop your premiums from skyrocketing because the insurers now have it both ways -- they collect premiums for NCB protection and if you are unfortunate to meet with an accident, they just push up your premiums sky-high without a care about your NCB protection. Sigh!
BOO-QUET for the motor insurance industry!!!
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