Tuesday, August 5, 2008
Joke: Passed by the manager
Notice in a foreign hotel: The water in this hotel is hygienic. It has been passed by the manager.
Freely negotiated fees
To: Consumer Association
The Competition Competition has mandated that fees should be freely negotiable. The apply this requirement to doctors and property agents.
The Commission think that this is to the benefit of consumers. It is likely to work the other way. If fees are freely negotiated, and the standard and scope of service is not clearly defined, consumers can be put to a disadvantage. The industry players (i.e. doctors and property agents) are more knowledgeable about the playing field and will be able get away with higher charges, as consumers are not aware about the market.
A better approach is for the Commission to get the industry association to define a few standard services and require the providers to advertise their fees for these services.
I hope that the Consumer Association can look into this matter.
The Competition Competition has mandated that fees should be freely negotiable. The apply this requirement to doctors and property agents.
The Commission think that this is to the benefit of consumers. It is likely to work the other way. If fees are freely negotiated, and the standard and scope of service is not clearly defined, consumers can be put to a disadvantage. The industry players (i.e. doctors and property agents) are more knowledgeable about the playing field and will be able get away with higher charges, as consumers are not aware about the market.
A better approach is for the Commission to get the industry association to define a few standard services and require the providers to advertise their fees for these services.
I hope that the Consumer Association can look into this matter.
Taxi without driver
Imagine that you can board a taxi that is driven automatically (i.e. without a driver) and take you quickly to your destination, without any traffic congestion.
This is called a PRT. Read about this concept in
www.singaporepublictransport.blogspot.com
This is called a PRT. Read about this concept in
www.singaporepublictransport.blogspot.com
Monday, August 4, 2008
Joke: Black or white
The American from Alabama was in a coffee shop of an expensive hotel in London.
Waiter: How do you like your coffee
American: I like it like my woman, strong and sweet.
Waiter: Black or white?
Waiter: How do you like your coffee
American: I like it like my woman, strong and sweet.
Waiter: Black or white?
Personal Accident Insurance
Hi Mr. Tan
I currently have SAFRA Essential Term (http://www.income.com.sg/insurance/safraterm/ ) and SAFRA Living Care ( http://www.income.com.sg/insurance/safracare/ ) policies.
Effectively, the two policies cover Death, TPD, the 30 major CI, and hospitalization.
In addition, as a employee of my company, I am covered for basic medical expenses incurred for seeing a doctor.
I have an agent from NTUC trying to sell me personal accident insurance. In your opinion, is there any further benefit to me for taking this up?
REPLY
A personal accident policy is low cost and is useful to supplement the cover under your life policies. If the total sum assured under your life policies is not adequate, you can buy a personal accident policy to supplement the coverage. The annual premium to cover $100,000 should be less than $80 for most occupations.
I currently have SAFRA Essential Term (http://www.income.com.sg/insurance/safraterm/ ) and SAFRA Living Care ( http://www.income.com.sg/insurance/safracare/ ) policies.
Effectively, the two policies cover Death, TPD, the 30 major CI, and hospitalization.
In addition, as a employee of my company, I am covered for basic medical expenses incurred for seeing a doctor.
I have an agent from NTUC trying to sell me personal accident insurance. In your opinion, is there any further benefit to me for taking this up?
REPLY
A personal accident policy is low cost and is useful to supplement the cover under your life policies. If the total sum assured under your life policies is not adequate, you can buy a personal accident policy to supplement the coverage. The annual premium to cover $100,000 should be less than $80 for most occupations.
Key man insurance
Dear Mr. Tan,
My friend bought a Prulink product for himself many years back. The company paid the premium. He is the one of two directors and shareholders of this company. This insurance is purchased under the keyman policy. He is the insured person and the company is named as the owner of the policy.
Unfortunately, my friend met with an accident and is paralysed. The insurance paid out S$800,000. Cheque was issued to the company.
Should this money belong to the company or should it be paid to the insuree? Can this money be held at the company since it was paid by the company and was purhcased as a key-man policy? Or, can this money be construed as gratitous payment to be paid to the family member immediately?
REPLY
It depends on the agreement between your friend and the company. If the company took the policy and pays the premium, the company is the owner. The compnay has an insurable interest in the key man of the company, as the disability of the keyman can cause some loss of profit to the company.
If the company has an agreement with the keyman to pay the proceeds to the keyman or his family, then the payment should be made according to this agreement.
My friend bought a Prulink product for himself many years back. The company paid the premium. He is the one of two directors and shareholders of this company. This insurance is purchased under the keyman policy. He is the insured person and the company is named as the owner of the policy.
Unfortunately, my friend met with an accident and is paralysed. The insurance paid out S$800,000. Cheque was issued to the company.
Should this money belong to the company or should it be paid to the insuree? Can this money be held at the company since it was paid by the company and was purhcased as a key-man policy? Or, can this money be construed as gratitous payment to be paid to the family member immediately?
REPLY
It depends on the agreement between your friend and the company. If the company took the policy and pays the premium, the company is the owner. The compnay has an insurable interest in the key man of the company, as the disability of the keyman can cause some loss of profit to the company.
If the company has an agreement with the keyman to pay the proceeds to the keyman or his family, then the payment should be made according to this agreement.
Rights Issue
Dear Mr. Tan
I would like to seek your invaluable adivce on the upcoming rights issue offered by X. Do you think it is a good investment? What actually is a rights issue?
REPLY
If a company wishes to raise additional capital, it offers a rights issue to its existing shareholders. The price is usually lower than the current market price of the shares.
Let me give an example. A company has 10 million shares. It is now trading at $3. The company needs raise an additional $10 million in capital. It decides to issue 5 million shares at $2 to the existing shareholders. Each shareholder is allowed to buy 1 share for every 2 shares that they now own.
Many shareholders will take up the new shares because it is offered at a price ($2) lower than the current market price ($3). After the rights issue have been completed, the share price may drop below $3 due to the dilution of new shares issued at $2.
If the shareholder does not wish to invest in the new shares, the shareholder can sell the rights in the market. The value of the rights depend on supply and demand and is likely to be around $0.30.
I am not able to give an specific comment about the rights issue of X.
I would like to seek your invaluable adivce on the upcoming rights issue offered by X. Do you think it is a good investment? What actually is a rights issue?
REPLY
If a company wishes to raise additional capital, it offers a rights issue to its existing shareholders. The price is usually lower than the current market price of the shares.
Let me give an example. A company has 10 million shares. It is now trading at $3. The company needs raise an additional $10 million in capital. It decides to issue 5 million shares at $2 to the existing shareholders. Each shareholder is allowed to buy 1 share for every 2 shares that they now own.
Many shareholders will take up the new shares because it is offered at a price ($2) lower than the current market price ($3). After the rights issue have been completed, the share price may drop below $3 due to the dilution of new shares issued at $2.
If the shareholder does not wish to invest in the new shares, the shareholder can sell the rights in the market. The value of the rights depend on supply and demand and is likely to be around $0.30.
I am not able to give an specific comment about the rights issue of X.
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