Singapore offers universal healthcare coverage to our citizens, with a financing system anchored on the twin philosophies of individual responsibility and affordable healthcare for all. This is done by implementing different tiers of protection,

Francis Hoan, Jason Tian and Chew Hock Beng​, Financial Consultants at Financial Alliance Pte Ltd, give detailed answers to your questions.

Question by vincenttan

I have health coverage through my current employer however i’m leaving my job soon. Although I'm quite satisfied with my existing coverage, I cannot carry it from job to job. What are my options? And what happen if I have a pre-existing condition? Kindly advice. Thanks :)

Answered by by from Francis Hoan Financial Consultant, Financial Alliance Pte Ltd

Disclaimer: Please note that I am answering your question without specific information of the type of coverage and how extensive is the coverage provided by your company for your children, except that it is probably a “sub-limit” plan on a co-pay basis (not sure for premium or upon claims).

All answer will take on a general approach.

1. Underwriting (risk assessment) for company’s health insurance

Typically, underwriting is done before accepting an employee to be covered for standard rates. There are generally two ways insurers go about doing that. First, get all employees to fill out a health declaration form, submit to insurers for underwriting and then offer cover. Second way is to cover all employees without underwriting, but exclude all pre-existing health conditions of an employee from cover.

There may be a clause that pre-existing conditions are excluded for say one to two years and after which pre-existing conditions are covered but again there are certain medical conditions that are exceptions to this clause as well.

2. Portability

Main issue/contention of company’s coverage is portability of coverage. When one changes job, they cannot bring it with them to the new company. The coverage is terminated with the existing insurer and a fresh coverage is initiated with the insurer of the new company. As such, as mentioned in the preceding paragraph, either underwriting is applied or pre-existing clause is applied to the new coverage.

As one gets older and changes job, they run an increasing risk of being insured at a sub-standard rate (pay more premiums) and/or certain medical conditions are excluded from cover with the insurer of your new employer. Or worse case scenario cover is declined

The same treatment is applied to any other family member that is applying for cover with the new insurer.

As such, my professional advice and suggestion is not to treat the company’s health insurance coverage as the base plan since it is subjected to certain constraints like sub-limits and uncertainty of coverage if and when one changes job or is terminated.

It is wiser to own health insurance that is not subjected to such risk. This risk can be easily avoided with taking up personal health insurance. Personal insurance such as a medisave funded shield plan and its riders, cash benefit plan or a critical illness plan.

3. Premiums

You are right to observe that premiums for health insurance increases with age. Usually it is based on age banding. Generally premiums for age ranging from 1 to 25 years of age are the same. Then the subsequent age bandings are based on 5 to 10 years band.

Premium payment is only one factor to consider if one should purchase a health insurance or any other type of medical coverage.

What is more important is, if one can be offered coverage when one is ready to be insured. So, as soon as one is covered, this uncertainty is removed. Moreover, all medisave approved plan are based on guaranteed renewability of coverage.

Conclusion

Health or medical insurance is age sensitive, it is even more sensitive to health history of the person. So, early coverage is the sensible thing to do as rarely one’s health improves with age but vice versa is true.

Question by pearlynwan

hi, I heard about eldershield, but can you explain more on how we can get coverage on this plan ?

Thanks

Answered by Mr. Jason Tian Financial Consultant, Financial Alliance Pte Ltd

ElderShield is a Long Term Care (LTC) insurance policy. It is designed to meet some or all of the costs of daily living of the Insured who, as a result of accident or illness, is physically disabled to the extent that they become dependent on others to help them in their daily living activities.

The 6 Activities of Daily Living (ADLs) are Mobility, Feeding, Transferring, Dressing, Bathing and Toilet. Insureds who are not able to perform 3 or more ADLs will be eligible for the payouts. The payouts is in the form of a cash benefit and they are not tied to the reimbursement of institutional care expenses.

ElderShield is an opt-out scheme. Singaporeans and Singapore Permanent Residents with Medisave accounts are automatically covered under the ElderShield scheme at age 40.

The Ministry of Health has appointed Aviva, The Great Eastern Life and NTUC Income as ElderShield insurers.

Members who are eligible to be covered under the Scheme will be randomly assigned to either one of the insurers.

Singapore Citizens and Permanent Residents who are below age 65 and not in the auto-coverage group or have previously opted out from the scheme can apply for ElderShield coverage with one of the three appointed insurers above.

Question by healthblur

I have a hospitalisation policy and a term life policy w endowment with a health insurance agency. As I was getting all confused about the different types of policies and wondering about duplication, ( and hence unnecessary cost), the agent told me that of all of the policies I have, I should terminate the eldershield one. Would you agree with this view?

Both my husband and I are in our late forties, generally healthy at the moment....

Also, as we have company health insurance, how does any hospitalisation claim work? I am tempted to stop my own health insurance policy for a while, unltil and unless I get less cover / no cover through employment. Does this make sense, or what are the downsides/risks?

Greatly appreciate your objective advice. thanks

Answered by Mr. Jason Tian Financial Consultant, Financial Alliance Pte Ltd

Do not terminate any of your current policies until you’ve done a thorough assessment of your current as well as future needs because you may not be able to get the cover back again later.

A hospitalisation policy is basically a medical reimbursement plan for Insured who is warded in a hospital due to either accident or illness.

The plan helps the Insured and/or the family to meet some or all of the medical expenses incurred.

A term insurance policy provides coverage for a specified period of time. The sum assured is payable only if the Insured dies within the policy term. If the Insured dies after the policy expiry date, the family will not receive any payout. Also, a term policy has no saving or investment element and so it does not accumulate cash value.

Endowment policy combines coverage with savings. With this policy, the Insured would receive a sum of money when the policy matures. However, if the Insured dies during the tenure of the policy, the family will receive the insurance payout which include the basic sum assured and accumulated bonuses/dividends, if any.

In addition to the basic policy, Insured can enhance its coverage by adding riders such as a Hospital & Surgical rider, Critical Illness rider etc.

Eldershield is not a hospitalization plan. It is a Long Term Care insurance policy designed to meet some or all of the costs of daily living of the Insured who become dependent on others to help them in their daily living activities such as bathing, feeding etc.

It is an important part of the total insurance plan. In fact, based on the fact that we are living in a country with fast aging population and ever-increasing healthcare and long term care cost, you should be thinking of increasing the coverage on Eldershield instead of terminating the cover. The claim process may differ depending on what are the plan(s) the Insured is having.

It is always tempting to stop or postpone our personal hospitalization plan to a later date. However, the risk of doing this is high. We may not be able to purchase a hospitalization plan when we most need it. Common medical conditions such as raised blood pressure or cholesterol may result in exclusions and/or raised premiums. In extreme cases, the insurer may decline the application due to medical history or condition.

Question by lee

My main concern is what coverage I can get for both treatment cost and any 'loss of work' should I get a serious problem like cancer or heart attack/heart failure.

What is the best plan that I should ensure I sign up for to cover this, which does not make me pay unnecessary premiums, yet has comprehensive cover for such problems, especially something like cancer, where the cost is apparently very high and long term. How much should a middle class person sign up for?

A few years ago, I attended a talk by some 'advisor' and I somehow recall the presenter saying that with most insurance policies, it will not give a payout for early cancer. Is this true? Something about in the fine print, but I can't recall exactly...

Thank you.

Answered by Answered by Mr. Chew Hock Beng Chartered Financial Consultant, Chartered Financial Underwriter, Financial Alliance Pte Ltd

The best way to cover for treatment cost ( main stream treatment, ie , western medicine ) is to be insured adequately by a Hospitalization & Surgical plan.

If you are a S’porean or SPR, you must enroll yourself in one of the Medishield Integrated H&S Plan which allows you to pay premium using your medisave. Currently, 5 life insurers carry this product and they are NTUC Income, GE Life, AIA, AVIVA and Prudential.

As for the ‘loss of work’ , I assume your concern is the loss of income after contracted any major illness and is unable to work for a long period of time.

There are 2 ways to approach this need:

1. Get yourself insured with a critical illness insurance plan which pays you the sum assured in a lump sum upon the diagnosis of contracting any of the covered illnesses (usually 30 illnesses)
2. The other is to be covered by a disability income plan which pays you a monthly income when you are totally unable to work due to sickness or injury.

While both approaches have its pros and cons, the claim for CI insurance plan is more straight forward. The continuous proof of disability is required for disability income plan.

For CI insurance plan, it is indeed true that insurer pays claim only when the severity level of the illness meet the illness definition set by the insurer.

However, some insurers have responded to demand ( to cover illness at early stage) for new Critical Insurance (CI) plan. Unlike the conventional CI plan whereby the insurer would make a one-time lump sum payout upon diagnosis of any one out of the 30 CIs covered, subject to claim criteria, (www.lia.org.sg) the new CI plans make payment before the advanced stage of the illnesses.

Some even allow the policyholder to make multiple claims during the policyholder’s lifetime, subject to policy provisions. If the plan can complement your hospitalization & surgical (H&S) coverage, to pay for expenses incurred outside hospital, able to replace your income during this period of hardship (Disability Income Insurance) and to reduce your financial stress, this could be the most appropriate and suitable plan that you are seeking for.

As comprehensive as such plan could be it comes with a price-tag. Not only we need to access the cost and benefits of the plans, one need to fully understand the features & medical terms of such plans. And, it is usually confusing.

Hence, to find the suitable products that suit your needs and budget, I suggest that you talk to one that has multi-representation of insurers as such adviser is more likely to find you the value products that suit your needs.

Ref: V10