Hundreds queue to terminate AIA
policies
THE man in the line could not be convinced by the
assurances.
WE WANT OUR MONEY: The queue of people outside AIA Tower
yesterday afternoon. TNP PICTURES: CHOO CHWEE
HUA
The studio photographer in his 50s, who wanted to be known only
as Mr Heng, said he owns several AIA life insurance and
investment-linked policies.
Yesterday, he decided to terminate some of them and joined
scores of people who lined up from around 9am outside AIA
Singapore's Shenton Way headquarters.
This came after news on Monday that AIA Singapore's parent
company, American International Group Inc (AIG), had been allowed
to access US$20 billion ($29 b) of capital from its subsidiaries to
help it out of its difficulties.
AIG reported larger than expected losses in the first quarter of
this year, and by end-June, had lost US$13.2 billion. This, with
the collapse of investment bank Lehman Brothers and the takeover of
its rival Merrill Lynch by the Bank of America, has plunged the
world financial system into turmoil.
The Monetary Authority of Singapore (MAS) urged policyholders
not to act in haste.
AIG's problems
But Mr Heng said: 'Hong Kong-based websites which I read state
that AIG's problems could cause it to be bankrupt in a short time.
I think it is better for me to cash in my policies and get as much
returns now. If I wait too long, I may lose out.'
Three middle-aged men in the queue, who did not want to give
their names, were also adamant about terminating their life
insurance policies.
This, despite reassurances from staff and copies of press
reports pasted at the customer care centre to show that AIA is not
affected by the recent financial firestorm.
One of them said: 'I would rather do it now and get some money
than wait for more bad news later, by which time it may be too late
for me to get any money.'
One of his friends said: 'MAS made all those assurances in order
to prevent a panic. What will they be able to do if and when the
situation really gets worse? I don't want to wait until that
time.'
They were also not losing much money as their policies were near
maturity.
But there were others who were willing to give up their policies
even though they stand to lose more.
Finance company executive Manu Tandon, 25, said his brother
authorised him to terminate his AIA policy, although it was only in
effect for 10 years.
He said: 'Despite the MAS assurances, I do not feel confident
and I will carry out my brother's wishes, even though the surrender
value will be low.'
Bank employee C Y Ang, who is in her 30s, also said she wanted
to terminate her life insurance policy although it was only in
effect for about 10 years.
Agreeing with her was finance executive Liza Tham, 45, who said:
'We have only heard from MAS, but we have not heard anything from
AIA or AIG. That is why I went to AIA Tower today, to find out what
they have to say about the matter.'
One AIA agent, who did not want to be named, said many of her
clients had called her during the last few days. 'Many of them
wanted to terminate their policies but I managed to assure them to
keep their policies. I promised them I would update them as soon as
I got more news,' she said.
An AIA Singapore spokesman said the firm could meet the
liabilities of all its policyholders.
