HOLDERS of NTUC Income policies can expect a better payout this year, thanks to the insurer’s sterling performance in 2004.

It reaped a surplus of $543 million last year – an 18 per cent increase over 2003 – helped by a rebound in the economy and better investment climate last year.

As a result, $213 million of this surplus will be paid as bonuses to its estimated 800,000 policyholders this year, up from last year’s $174 million.

Said Income CEO Tan Kin Lian: “This is the second time we have increased bonuses in two years.”

Last year, the insurer said it would pay out an additional bonus to all its life policyholders to celebrate its 35th anniversary.

And despite these bonus increases, the bonus rates are reported to be slightly less than those enjoyed in 2002.

This is expected to improve as interest rates rise.

With the favourable investment backdrop, the overall investment returns for the year was $684 million. Excluding capital gains, investment income came to $402 million.

Premium income from the life insurance fund swelled 42 per cent to $1.7 billion.

Regular premium income increased 9.1 per cent to $878 million and single premium income grew 106 per cent to $793 million.

At the end of 2004, Income had 1.22 million life insurance policies in force, of which 283,000 were group and health main insurance policies.

Yet Income maintained its AA rating by Standard & Poor’s.

Its general and health insurance business also showed a healthy surplus of $30 million.

This was contributed entirely from the investment income, as the premiums were inadequate to cover the claims and expenses.

The co-operative also has 453,000 general insurance policies in force, with a premium income of $304 million. This represents an estimated market share of more than 15 per cent making it the largest general insurer in Singapore.

Motor insurance continued to be the largest class of business and contributed to 84 per cent of the premium income.
Total net assets, on the other hand, increased by 15 per cent to $13.4 billion. Total premium income increased by 25 per cent to $2 billion.

During the past year, the co-operative continued to give financial support to the community and worthy causes.

It received numerous accolades, including the Sporting Singapore Inspiration Award from Singapore Sports Council, SHARE Distinguished Platinum Award from the National Council of Social Services, and the SAF Award for Employers, among others.

In addition, it insured 349,000 Singaporeans under Eldershield.