A STUDY OF THE NATIONAL TRADES UNION CONGRESS CO-OPERATIVE INSURANCE COMMONWEALTH ENTERPRISE LTD. (NTUC INCOME) IN SINGAPORE

Abstract

This academic exercise makes a qualitative study of the National Trades Union Congress Co-operative Insurance Commonwealth Enterprise Ltd. (NTUC INCOME), with the support of quantitative analyses. Some aspects of interest follow. Life assurance has not been a must for most workers in Singapore mainly because of the duplicating functions of the Central Provident Fund (CPF) scheme. Even then, this form of compulsory savings cannot reach all or adequately provide for the social security of some. Where private companies are unwilling to insure owing to policy size or cost reasons, NTUC INCOME provides the solution. Generally, the cheaper INCOME policies exhibit stronger income effects. The expensive Endowment insurance is an exception as its small insured sums render it most sensitive to income changes. The strength and weakness of INCOME are best shown in the comparison of its output and market share with those of American International Assurance (AIA) and Great Eastern Life Assurance (GE) companies. In catering to the insurance desires of most workers, INCOME issues small policies which prevent the reaping of economies of scale. In minimising its sales expenses, it allows a poor quality of policy service to prevail. With a host of conflicting social and economic aims, INCOME needs to review its strategy before losing its exclusive trade union and co-operative advantages. Its efforts are now directed at designing better and larger policies to insure even more people. Today, INCOME symbolises the hopes and aspirations of many who wish to provide a more secure future for themselves and their dependants.