Involving FTrash again!
Know what you’re signing: insurance agents
By Ion Danker – October 10th, 2010
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Insurance agents Yahoo! Singapore spoke to say that the latest multi-million dollar insurance scam involving an agent selling a non-existent insurance policy will negatively impact the image of agents.
But they also said a useful lesson can be learnt from the case — that clients need to be more mindful of what they are being sold and how to make payment.
In an ongoing high-profile case, a former high-flying agent from
American International Assurance (AIA) is being sued by a semi-retired Indonesian businessman for selling him a fake insurance policy that cost a staggering S$6.5 million.
Mohd. Shaiful, 35, who has been in the industry for over five years, said the latest case will affect the image of agents.
“It will have a ripple effect and a lot of us will be affected by this bad publicity,” he said, before offering his take on the case.
“Clients need to be wary as to what they are getting into and in any circumstances where you want to take premiums which involves cash, always insist for an official receipt, and when making payment, never pay in cash or cash cheque. The cheque should have the name of the company on it.”
“When paying premiums of a certain amount, have your agent produce a letter of undertaking and if unsure, call the company to enquire for more details,” he added.
Another agent, John Peh, agreed and said “there will be repercussions felt by agents in the industry due to this incident.”
“If you’re uncomfortable before signing the documents, just say ‘no’ and call the company to find out more details,” he said.
In the case reported by
The Sunday Times, businessman Mr Ong Han Ling, 72, is taking his agent, Ms Sally Low Ai Ming, to court and is claiming about $3.6 million plus loss of use of his funds.
The $3.6 million is the amount left outstanding after the agent made restitution for some of the policy premiums. The police and insurance giant
AIA are investigating claims.
But according to the paper
, the 33-year-old Ms Low – who was sacked by AIA in September last year — is contesting his claims.
She claims that the fake insurance plan called the “AIA Thank You Policy” she sold him was part of an elaborate ploy conceived by Mr Ong to defraud AIA.
Ms Low – who was a former protege of AIA’s top-producing agent and ex-Taiwanese actress Mary Chen — claims she was merely an accomplice.
Mr Ong revealed in his suit that Ms Low became a trusted friend of his family after he and his wife Enny Ariandini Pramana, 71, started buying several policies from her in 2000.
In 2002, Ms Low reportedly told Mr Ong about a policy — called the “AIA Thank You Policy” — that was offered only to high net-worth clients, which required a single premium payment of about US$5 million.
The policyholder, in return, would receive annual fixed returns of 6 to 7 per cent, payable upon maturity of the policy in five years. This worked out to maturity sums of US$4.95 million plus $4.5 million.
Mr Ong said that he only found out from AIA that the policy did not exist after receiving a call from the company’s Singapore office when the maturity payouts were due in January 2008.
He claims that Ms Low had instead used the premium payment of US$5.06 million to buy four AIA policies under his name, his wife’s and their daughter’s names without their knowledge.
But in her defence, Ms Low alleged that it was Mr Ong who planned for them to defraud AIA and share half the gains when she approach him to buy more policies in 2002.
She said that the ploy was for her to sell the non-existent policy to Mr Ong and once this was exposed, AIA would be held responsible for Ms Low’s misdeed and would be obliged to compensate him for his losses – possibly honouring the maturity sums promised.
She also claims that by mid-2005, she regretted being part of the plan to cheat AIA and instead asked Mr Ong to give her a free hand in carrying out the investments with the money she received from him until 2007 in order to achieve returns that would match the amount he wanted to get from the plan to defraud AIA.
However, she was unable to do so due to the market downturn.
Ms Low alleges that as she did not fraudulently sell Mr Ong the “AIA Thank You policy”, she is not liable to pay or reimburse anything to him.
The latest insurance scandal has shocked industry watchers.
President of the
Singapore Insurance Institute, Mr Stanley Jeremiah, told
The Sunday Times he has never heard of an agent selling a non-existent product.
He said, “I’ve heard of agents who pocketed the premiums before disappearing or buying some other policy that the client didn’t agree to.”
When contacted, AIA told the same paper: “We are currently conducting an investigation into the matter, including the allegations as outlined in the court papers by our policyholder and the defence raised by our former agent.”
It said it could not provide more details because legal proceedings are under way.
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