Archive for September, 2008
Insurer drops client who queried other driver’s claim
Written by Kelvin on September 24, 2008 – 9:24 am -| Sep 24, 2008 |
| Insurer drops client who queried other driver’s claim |
| NTUC Income says it had done its best, but client was still unhappy |
| By Christopher Tan |
| AFTER businessman Amirul Bahar was involved in a fender bender in a carpark last November, he replaced the bumper of his Toyota Wish seven-seater for $650.
The 52-year-old got a shock when the other driver, whose Nissan Sunny sedan sustained a minor dent on the front right fender, filed claims amounting to $18,000, the bulk of it for personal injury.
This kicked off, for Mr Amirul, nearly nine months of trying to convince his insurer NTUC Income that the other party was making exaggerated claims. Then last week, he got another shock: NTUC Income wrote to say it no longer wanted his business. In a letter to Mr Amirul’s wife, in whose name the car is registered, Income noted that the car’s insurance would expire next month, and that it was not ‘inviting’ her to renew the coverage with the company. Mr Amirul said: ‘We’re disappointed. We were trying to make some sense of how a minor accident could result in such high claims. ‘We wanted to protect our no-claim bonus, but at the same time, we were trying to help Income save some money.’ With the help of a private investigator they hired, the Amiruls said they found inconsistencies in the claims made by the other driver, who is an AIG insurance agent. These include: But Income, one of Singapore’s largest motor insurers, said it did not have ‘conclusive’ evidence to dismiss the claims. In the course of his correspondence with Income, Mr Amirul had objected to the insurer’s choice of a surveyor to re-inspect the other party’s car, on the grounds that it was the one that did the first inspection. Mr Amirul said: ‘We were willing to pay for an independent surveyor, but Income did not agree.’ Income said it engaged LKK as surveyor because it was ‘a reputable company… used by many big insurance companies’. The other party involved in the accident, who declined an interview, has since filed suits to get compensation. Asked why it has decided to drop Mrs Amirul as a customer, Income said it had done its best, including ‘investing senior management time, monetary resources and engaging professional services’. It paid $4,000 for the services of the private investigator the Amiruls hired. ‘Despite our best efforts, Mr Amirul has made clear his dissatisfaction with our services, and we are not confident of being able to meet his expectations moving forward…As with any business making a commercial decision, we feel that it would not be in the best interests of both parties to continue this relationship.’ It is not the first time that the insurer has dropped a customer. It has in the past refused renewals from people who ‘act unreasonably’ when settling a claim, or those it suspects of having colluded with workshops to inflate claims or to stage accidents. It has also refused to do business with people who have harassed its service staff. The Amiruls are at their wits’ end. ‘We’ve spent so much time and effort on this. Look at the size of this file,’ Mr Amirul said, pointing to a phone book-size folder documenting the case. ‘We will look for another company to insure with. Worst comes to the worst, we will stop driving temporarily.’ He admitted that the Primary Dispute Resolution Centre, a mediation centre at the Subordinate Courts, had found him 90 per cent liable for the accident, which happened when he was reversing to make a turn out of the carpark. His car collided with the approaching Sunny. He said he disagreed with the centre’s finding, but it was not why he pursued the matter. His fight has been about the $18,000 bill for a minor scrap. ‘How could such slight damage result in such high claims, and how could it result in injury? Something must be very wrong,’ he said. HOW COULD IT BE $18,000? ‘We were trying to make some sense of how a minor accident could result in such high claims.’ |
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AIA assures Policyholders
Written by Kelvin on September 18, 2008 – 8:05 am -AIA Singapore assures Policyholders once again of its liquidity and reserves being sufficient to meet policyholder’s liabilities.
article-20080917-today-advertisment.pdf article-20080917-hbz-advertisment.pdf
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Updates on AIG
Written by Kelvin on September 17, 2008 – 1:40 pm -| Title | : | US launches AIG rescue loan to avoid market catastrophe |
| By | : | |
| Date | : | 17 September |
| URL | : | http://www.channelnewsasia.com/stories/afp_world_business/view/376493/1/.html |
| NEW YORK: The US Federal Reserve announced Tuesday it would make an unprecedented US$85-billion rescue loan to save insurance giant American International Group (AIG) from bankruptcy amid fears of a catastrophic meltdown on financial markets.
A central bank statement said the Federal Reserve Board made the decision “with the full support of the Treasury Department” under Section 13(3) of the Federal Reserve Act. “The secured loan has terms and conditions designed to protect the interests of the US government and taxpayers,” the statement said. All of AIG’s assets would be pledged to secure the loan while the Fed would retain a nearly 80-per-cent stake in the company, the Fed announced. The move came after federal officials reportedly tried but failed to persuade private firms over the weekend to put up funds to save AIG. With the vast insurance firm facing bankruptcy, Treasury Secretary Henry Paulson, Fed Chairman Ben Bernanke and Fed President Timothy Geithner decided that a federal lifeline was needed to prevent a disastrous fall-out in the financial markets. The final decision came on Tuesday, as officials agreed it would be “catastrophic” to allow the company to fail, the Wall Street Journal reported, quoting an unnamed source familiar with the deal. Paulson and Bernanke reportedly went to Capitol Hill late Tuesday to meet with top leaders of Congress, and an influential New York senator, Charles Schumer, confirmed a historic move was in the works. “The administration is approaching an unprecedented step, but unfortunately we are living in unprecedented times,” Schumer said in a statement after meeting regulators about New York-based AIG. “Hearing of these plans, you have to stop to catch your breath. But upon reflection, the alternatives are much worse,” said the Democrat, a member of the Senate Banking Committee. Shares in AIG - a company with US$1 trillion in assets and tentacles in many markets - went on a roller-coaster ride on Tuesday, sliding 70 per cent at the open, swinging into positive territory and then closing down 21 per cent after a 60-per-cent plunge Monday. New York Governor David Paterson earlier said AIG had one day to raise up to US$80 billion to stave off bankruptcy and avoid financial calamity. In its first public statement since its shares went into a freefall on bankruptcy fears, AIG said earlier its insurance, retirement and other financial services were operating normally. AIG said its businesses “including its extensive Asian operations, continue to operate normally and remain adequately capitalised and fully capable of meeting their obligations to policyholders.” The statement added that AIG “continues to pursue alternatives to increase short-term liquidity in the parent company.” David Kotok, chief investment officer at Cumberland Advisors, said earlier the US central bank had to act to avert a collapse at AIG that would be a calamity for markets - which went into shock after the Lehman Brothers’ bankruptcy Monday. “This has the appearance of a cascade or a contagion. Failure of Lehman Brothers has created contagion because of counter-party risk that was not contained by the Fed,” Kotok added. “Failure of AIG will make this much worse.” But Liz Ann Sonders, chief strategist at Charles Schwab & Co., said a Fed bailout might set a bad precedent. She said “other companies would undoubtedly look in the Fed’s direction for help.” In blow after blow late Monday, the three main rating agencies - Standard & Poor’s, Moody’s and Fitch - lowered AIG’s credit score in a sign of solvency troubles for AIG. Sonders said that according to AIG regulator filings, the rating cuts are likely to trigger up to 17 billion in collateral calls. Far more than other insurers, AIG has been a big player in a complex parallel market called credit default swaps (CDS), financial instruments in which Wall Street companies take out a form of market insurance against the risks of bond default. These products, often linked to the US real estate market, are at the heart of the current banking crisis and have led to massive write-downs of assets around the world. AIG alone has written off US$25 billion amid spiking defaults on US mortgage payments in the United States. - AFP/yb |
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