Corporatisation | Income Insurance

From 1 September 2022, we are operating as Income Insurance Limited, a public non-listed company limited by shares. This follows the successful transfer of the insurance business of the co-operative, NTUC Income Insurance Co-operative Limited ("Co-op") to Income Insurance Limited, as part of our corporatisation exercise.

As a corporate entity, we are better positioned to access strategic growth options and have greater operational flexibility to serve our customers better. We will stay true to our roots and extend real care to Singaporeans via our insurance propositions that support their unique goals and aspirations, as well as social causes that help build a stronger community - just like how we had done so from the get-go.

Operationally, there is no change to your engagement with us. Our service branches, network of advisors, customer support and online portals continue to be available to provide you with any information or assistance that you may require regarding your insurance matters.

Follow our milestones or view the FAQs below for more information.

Capital Reduction Announcement

Proposed Capital Reduction Exercise

SINGAPORE, 2 May 2023 – Following completion of the distribution in specie of shares in Income Insurance Limited (“Income Insurance”) to shareholders of NTUC Income Insurance Co-operative Limited, Income Insurance today submitted an application to the General Division of the High Court of Singapore (“High Court”) for approval for a capital reduction exercise (“Proposed Capital Reduction”). The Proposed Capital Reduction seeks to return excess capital of approximately S$43 million in aggregate to shareholders of Income Insurance on a pro rata basis.

The Proposed Capital Reduction will translate to a one-off distribution of around S$0.40 cash per share to all Income Insurance shareholders as at the date on which the order of the High Court approving the Proposed Capital Reduction is lodged with the Registrar of Companies (“Books Closure Date”). There will be no cancellation of any Income Insurance shares and there will be no change in the number of shares in Income Insurance held by Income Insurance shareholders as a result of the Proposed Capital Reduction.

The Proposed Capital Reduction is not expected to have any material impact on Income Insurance’s solvency and capital levels, which will remain well above regulatory requirements following the completion of the Proposed Capital Reduction.

While the Proposed Capital Reduction is subject to approval from the High Court, Income Insurance has obtained the necessary approval from the Monetary Authority of Singapore.

The Proposed Capital Reduction is intended to help shareholders with Income Insurance’s transition from a co-operative to a company. Income Insurance will be organising a Shareholders’ Briefing to share more information on the Proposed Capital Reduction (including the estimated Books Closure Date and the date on which payment of the cash distribution is expected to be made^). Details of the Shareholders’ Briefing will be communicated to shareholders in due course.

^subject to High Court’s approval being granted prior to the Shareholders’ Briefing.

Corporatisation Milestone Leading Up to Liquidation of NTUC Income Insurance Co-operative Limited (Co-op)

Date	Description	Attachment
6 Jan 2022	Announced Co-op’s corporatisation exercise	NTUC Income Corporatises to Further Strengthen Its Competitiveness for Long-term Growth
6 Jan 2022	Informed policyholders about Co-op’s corporatisation exercise	PDF
14 Jan 2022	Published Notice of EGM on the Straits Times, Lianhe Zaobao, Berita Harian and Tamil Murasu	PDF
21 Jan 2022	Held Infomation Sessions for Co-op’s Institutional and Ordinary members	-
13 May 2022	Published Notice of Intention (NOI) in eGazette, The Straits Times, Lianhe ZaoBao, and Income website. Published Scheme of Transfer, Supplemental Scheme and Amendment of Effective Date on Income’s website	Government Gazette Scheme for Transfer of Insurance Supplemental Scheme for Transfer Amendment of Effective Date
13 May 2022	Informed policyholders on the NOI and the Scheme documents	PDF
14 Jun 2022	Approval of the Scheme of Transfer obtained	PDF
1 Sep 2022	Effective date of new company – Income Insurance Limited	-
28 Dec 2022	Liquidation of NTUC Income Insurance Co-operative Limited	PDF
6 Apr 2023	Distribution-in-specie of Income Insurance Limited shares to Co-op shareholders	-
26 May 2023	Completion of physical share certificates deliver to Co-op shareholders	PDF

For Policyholders

1. Does the corporatisation exercise, including the transfer of business to the new corporate entity, affect policyholders?

The insurance policies issued by the co-operative, NTUC Income Insurance Co-operative Limited (Co-op) and personal data collected by the latter, had been successfully transferred to the new corporate entity, Income Insurance Limited (Income Insurance) via a ‘Scheme of Transfer’ under the Insurance Act 1966 and other agreements entered between the Co-op and Income Insurance. All existing policy coverage, benefits and terms remain unchanged.
For existing insurance policies, there is no need for Income Insurance to issue new contracts.
Policyholders can continue to tap on existing service branches, network of advisors, customer support and online portals to assist them on their insurance matters.
With corporatisation, policyholders can look forward to more accessible, competitive, and comprehensive solutions, including innovations that speak to today’s digital-first customers.

2. Does corporatisation affect the nomination of beneficiaries for my policy?

For insurance policy beneficiaries, the new corporate entity, Income Insurance Limited recognises valid nominations made in accordance with the requirements of Section 45 of the Co-operative Societies Act (CSA) and valid nominations made in accordance with requirements of Section 132 or 133 of the Insurance Act 1966, unless they have been revoked, or a new nomination has been made (under the Insurance Act 1966) prior to 1 September 2022.
It is not necessary for life policyholders to take any action in respect of their existing nominations. All nominations which remain valid and are not revoked immediately prior to 1 September 2022 have been transferred to, recognised by and binding on Income Insurance Limited on and from 1 September 2022.
Nevertheless, we encourage policyholders, who had made such nominations before 1 September 2009 (under the CSA) to refresh their nominations so that it is effective under the Insurance Act.
Policyholders may wish to refresh their nomination to include any changes in their personal circumstances or beneficiaries.

3. Do I need to amend my will if I referenced insurance policies issued by the Co-op in my will?

It is not necessary, as the reference to the insurance policies issued by the co-operative, NTUC Income Insurance Co-operative Limited (Co-op) is correct at the time when the will was made. All existing insurance policies had been successfully transferred from the Co-op to the new corporate entity, Income Insurance Limited as part of the corporatisation process.

4. The nomination of beneficiaries made under Income Insurance Limited will not be governed under the Co-operative Societies Act, which means that it will be a trust or revocable nomination. Is this true?

New nominations are made either pursuant to Section 49L(2) (now renumbered as Section 132) of the Insurance Act or a revocable nomination under Section 49M(2) (now renumbered as Section 133) of the Insurance Act.

For Shareholders

5. Do I have to make a fresh nomination of beneficiary for my shares in Income Insurance Limited (Income Insurance)?

Nomination of beneficiaries for Income Insurance shares is not required. Income Insurance shares shall be dealt with as part of the estate in accordance with the shareholder’s will or intestacy laws in the absence of a will.

6. How will Income Insurance share certificates be delivered to me?

The share certificates will be held in custody by Income Insurance’s Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. (Boardroom) by default. This aims to ease the administrative burden on shareholders in relation to the physical custody of share certificates and ensures that share certificates are securely stored.
Alternatively, shareholders have the option to make a request through Boardroom to receive and hold their physical share certificates personally.

7. What should I do if I were to lose the physical share certificate issued to me?

Shareholders have to report the loss of the physical share certificates to Income Insurance’s Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. (Boardroom) and file a statutory declaration and an indemnity form. Upon notification of the loss of physical share certificates, Boardroom will cancel the lost share certificates. To obtain a replacement share certificate, shareholders must pay a fee of S$2 (before GST). The replacement share certificate will be issued upon payment and is subjected to approval by Income Insurance.
Shareholders can contact Boardroom via income@boardroomlimited.com or call +65 6536 5355, Monday to Friday between 8:30 a.m. to 5:30 p.m.

8. How can the shares of Income Insurance be traded?

Income Insurance is a public non-listed company limited by shares.
Shares of Income Insurance are held by shareholders and can be traded by a shareholder who is a willing seller and who agrees to transfer his/her shares to a willing buyer at a price and on terms that are agreed by both parties, subject to any restrictions on such transfer that are binding on the selling shareholder (for example, if such shareholder has pledged his or her shares in favour of a third party).

9. What is the transfer process to effect the sale of my Income Insurance Limited shares to another buyer?

Please write in to income@boardroomlimited.com or call +65 6536 5355, Monday to Friday between 8:30 a.m. to 5:30 p.m.

10. Can a shareholder purchase more Income Insurance shares?

Income Insurance is not offering any share purchase option currently.
A shareholder who would like to purchase more shares can approach another shareholder who is a willing seller to explore purchasing additional shares at a price and on terms that are agreed by both parties.

11. What will be the value of the Income Insurance shares?

Income Insurance is a public non-listed company limited by shares. Income Insurance shares are not publicly traded and in the absence of a market share price, there are several ways for shareholders to get an indicative value of their shares. They include referencing Income Insurance’s Net Asset Value or NAV per share to get an indicative value of their shares.
For the payment of stamp duty under share transfer, the buyer should reference to Income’s company level NAV per share (including Treasury Shares). As of 31 December 2022, this figure is $29.07.

12. Why is Income Insurance undertaking a capital reduction now?

This capital reduction is a one-off exercise to allay shareholders’ liquidity concerns given that share redemption is no longer an avenue for shareholders to access liquidity.
We explored various options and decided on a capital reduction as it is the most viable option that can be implemented relatively quickly.
Income Insurance is very strong financially and its capital adequacy ratio remains well above regulatory requirements.
We are confident of our financial resilience and do not expect the one-off capital draw down to have any material impact on the company’s solvency position and capital adequacy level.

13. What is the impact of capital reduction on Income Insurance’s capital adequacy or solvency ratio?

The one-off capital reduction is only possible because of the company’s strong capital position.
The company does not expect the one-off capital draw down to have any material impact on its capital adequacy or solvency position which remains well above the minimum regulatory requirements post capital reduction.

14. Why is Income Insurance currently under an 18-month accounting period (1 July 2022 to 31 December 2023)?

The one-off 18-month long accounting period is due to the corporatisation exercise and serves to align the company’s financial period with the calendar year.

15. Why is Income Insurance not declaring and paying dividend for 2022, the first year that it corporatised?

The decision on whether dividends will be paid, and if so, the amount of such dividends, would largely depend on the business performance of the insurance business and whether there are sufficient distributable profits and is independent of the corporatisation exercise.
The 2022 business performance comprised the performance of NTUC Income Co-operative Limited, which operated from 1 January to 31 August 2022 and Income Insurance Limited, which operated from 1 September to 31 December 2022.
For 2022, due to investment market volatilities that adversely impacted the industry at large, Income Insurance and NTUC Income both recorded unaudited net losses before tax and levy, mainly attributed to unrealised market fair value losses in the investment portfolio.
We prefer not to provide the specific unaudited financial no. as the company’s financial period has not closed.
As companies and co-operatives in Singapore can only pay dividends out of profits or net surplus respectively, Income Insurance and NTUC Income have not declared and will not be declaring any dividend for 2022.

16. Why is the share buyback or other share liquidity mechanism not launched yet?

Income Insurance requires more time to assess practical options and operational requirements of share liquidity mechanisms, including but not limited to share buyback, as they hold varying regulatory and operational complexities.
The company aims to provide an update on share liquidity mechanisms by the end of 2023 and seeks shareholders’ patience and understanding on this front.

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We are now Income Insurance Limited