Insurance Coverage

Medical cost expenditure is increasing year on year according to Ministry of Health, cost of medical expenses index has increased from 2016 101.0 to 105.6, annual household medical expenses has increased from 2012/2013 4.5% to 2017/2018 5.5%.

Hospital & Surgical Plan

To avoid a situation of incurring out of pocket huge medical expenses, you should purchase an Integrated Shield Plan which is an add on to Medishield Life Plan. Medishield Life Plan is considered as the basic Hospital & Surgical Insurance. Integrated Shield Plan allows the insured to have the choice of ward class A or B1, private hospital, claim from insurance companies on medicine, X-ray, blood test and other medical tests. Singaporeans and Permanent Residents can use CPF Medical Account to purchase Integrated Shield Plan whereas Foreigners can use cash.

Everyone needs to understand the concept of pre-existing condition. If you purchase an insurance during clean bill of health, if there is any condition which develops later on will still be covered under your plan (if it is part of the coverage). However, if there’s pre-existing condition during application of insurance coverage, there could be loading (which means the premium will be more expensive) or the application may be rejected.

Even if your company provides hospitalisation benefits, it is important to have Integrated Shield Plan. Most of the local SME employers will purchase Group Medical Insurance which will cover visit to general practitioner. Only MNC and large corporations will purchase hospitalisation plans for employees with a cap to the coverage. It is important to have Integrated Shield Plan because once they leave the company, their coverage from the company will cease. If they want to purchase Integrated Shield Plan after that and an unfortunate event has already happened, the application may not be successful.

Critical Illness Plan

Critical Illness Plan payout amount should be 2 to 3 times the annual income of the insured. The payout should allow the insured to have a peace of mind while recovering during the period without a concern on income. However, if he or she passed away, the payout will help to alleviate some of the household expenses.

Retirees should not be concerned with loss of income due to critical illness. Therefore, Critical Illness insurance is not required for life. We can consider term plan for coverage.

If you have surplus cash, you can consider Critical Illness plan for children. In the unfortunate event when your child suffered from critical illness, the payout can allow parents to take time away from work to look after the child.

Insurance at Different Life Stages

20+ years old
Premium will be cheaper for younger ones, other than Hospital & Surgical Plan, can consider whole life plan and critical illness plan.

40+ years old
Blue collar: Need to consider the premium of Integrated Shield Plan and the level of coverage. If there is surplus in household savings, can consider buying critical illness plan.
White collar: Remember to purchase critical illness plan during employment.

60+ years old
Need to continue to have Medishield and Integrated Shield Plan.Remember to allocate a sum of money for the premium.

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