The world we live in gives us a millions reasons to get sick and medical expenses can skyrocket into thousands of dollars. Health insurance steps in to offer you a safety net to combat financial burdens that could occur in the wake of health issues.
With our changing lifestyle, our deteriorating environment and the increased stress levels, our overall health is declining. Running into health issues as we get older seems inevitable. Whether it’s genetic problems, contagious diseases, the result of environmental harm, or just an unhealthy lifestyle, we need to be prepared to deal with health issues mentally, let alone worry about the financial part of it. Having a health insurance policy will reduce the mental stress of paying for treatment and lets you focus on getting better. It is wise to be prepared for medical contingencies instead of worrying about it at the worst possible time.
What is health insurance?
Health insurance is a plan provided by insurance companies that will cover you financially for expenses incurred in case you may experience health issues at any point in your life. It will cover the insured's medical and surgical expenses. You hope you never need to use it, but it’s always better to have it handy.
Health insurance requires you to pay a premium for the term you choose. You may have to pay it monthly, quarterly, bi-annually or annually. Most policies can be renewed at your request.
The Government of Singapore implemented a plan in 1984 known as the 4M framework which consists of Medisave, Medishield, Medifund and Medication Assistance Fund. To ensure that sufficient funds are saved to last a lifetime, limits are set and adjustments are made occasionally. This fund can be used to pay for hospital expenditure when needed by the individual. But in view of the increasing medical costs, people are seeking comprehensive insurance cover to be better protected. Many insurance plans available in Singapore are Medisave-approved and will enhance your coverage.
Why do you need Health Insurance?
If something unfortunate were to happen resulting in huge medical bills, without health insurance, you might have to sell off assets, borrow money from people, or be in debt that you can’t pay back. Health insurances provide a range of benefits to safeguard you from these situations. Depending on the policy you choose, some of the benefits you could avail of are listed below:
- Cashless financial aid in case of hospitalization.
- Reimbursement for hospital expenditure.
- Financial cover for pre and post-hospitalization expenditure.
- Financial cover for prolonged treatments like chemotherapy and dialysis.
- Financial aid for emergency hospitalization.
- Financial protection for your family’s medical expenses.
- Medical check-ups.
- Cover costs of medication.
- Tax benefit.
- Availing cash income during hospital stay.
- Disability income.
- Long-term care.
- Financial aid in the case of critical illness.
Types of Health Insurance
Health insurance policies are available for self, family and groups which are employees of an organisation. Coverage offered depends on different insurance companies.
Insurance companies usually offer two types of health insurances based on payout:
- Direct/cashless insurance – Many hospitals require you to deposit a sum of money as assurance to cover the cost of your treatment, or leave a credit card with them in order to be treated. With certain insurance plans, the insurer will stand as guarantee and you will not be required to pay any money up front. You will be required to present your insurance ID, and a request for cashless hospitalization will be initiated. The insurance company will deal directly with the hospital for any bills and documentation required and approve the request for cashless hospitalization. The total medical bill at the end of your hospitalization will be taken care of by the insurance company. The bill paid by the insurance company will not include non-medical items that were used for your care, such as bed pads, surgical gloves and so on.
- Reimbursement insurance – Under other health insurance policies, you are required to take care of all expenses incurred at the hospital. You can file a claim for insurance, providing all related bills and documentation required, at your own cost. The insurance company will process the claim, and on approval, will reimburse you.
- Hospitalisation & Surgical (H&S) Insurance – A basic insurance plan that will reimburse covered H&S costs incurred due to accidents and illnesses.
- Catastrophic Medical Insurance – An insurance plan that covers major illnesses which usually has steep medical costs. This insurance usually covers prolonged treatment like dialysis, chemotherapy and radiation.
- Supplemental Medical Expense Insurance – This is an additional insurance meant to enhance your coverage and supplement the main medical plan. Its coverage is more extensive range of medical-related issues.
- Long Term Care Insurance – For cases where the insured is unable to perform the usual daily activities such as bathing, dressing, eating, using the toilet or simply moving around, a fixed monthly amount is disbursed for nursing treatment.
- Critical Illness Insurance – Also known as Dread Disease Plan, it disburses a lump sum if the insured is diagnosed with any of the critical illnesses covered.
- Hospital Cash Insurance – In case of hospitalisation due to an accident or illness, a daily income is paid directly to the insured to help offset regular expenses in the time that he/she is unable to earn an income. This amount is usually fixed at the beginning of the policy for a limited number of days per hospitalization.
- Disability Income Insurance – If the insured were to become totally or partially disabled and unable to work due to an accident or illness, a portion of the regular income is replaced.
List of Agencies/Companies providing health insurance in Singapore
A number of companies provide health insurance with different options to suit your needs and abilities. A few companies are listed below.
- Great Eastern
- Tokio Marine
FAQs – Health Insurance
- What expenses are covered by the insurance policy during hospitalization?
The insurance generally covers full or partial room or boarding expenses, nursing expenses, fees of the surgeon, physician, anesthetist, consultants and specialists. It will also cover operation theater charges, medicines used, blood, oxygen, X-rays and similar expenses.
- What expenses are not covered by insurance companies?
Expenses covered depends on the policy you have taken and differs from company to company. Generally, during hospitalization, only non-medical expenses will have to be paid by the insured, such absorbent bed pads, surgical gloves, administrative charges of the hospital, toiletries and utility charges, etc. Your policy may not cover expenses for pre-existing conditions, consultation fees and treatment for specific diseases. Please read the offer document carefully.
- Why is it so important to have a health insurance policy?
When we are healthy we tend to ignore the future. Medical issues can arise at any point in time and the cost of being ill can be extremely high. It is wise to seek out a health insurance policy that you will benefit from in your time of need
- How does cashless hospitalization work?
The insurance company will have a tie-up with a network of hospitals. The insured will have to present the insurance ID and the hospital will communicate directly with the insurance company for all payments and procedures. You may be required to pay a minimum amount for admission charge and non-medical items.
- My insurance doesn’t cover pre-existing conditions. What is a pre-existing condition? Do I need coverage for it?
A pre-existing condition is a medical condition that occurred before the health insurance policy went into effect. Common pre-existing illnesses are asthma, BP, and diabetes, but it could be any issue you faced before taking the policy. Some policies do not cover pre-existing conditions but many companies offer insurance that covers them. If you are young and healthy, you don’t have anything to worry about it and can take a policy that doesn’t cover pre-existing conditions. But if you have had previous medical problems, it is better to seek a comprehensive cover which protects you against illnesses you already have.
News About Health Insurance Singapore
Significant boost for online health insurance in Singapore
Eduardo Saverin, co-founder of Facebook Inc. is lending a helping hand to boost a Singapore-based health insurance company that operates online. His company B Capital Group will be taking up this venture that is valued at $100 million.
EDBI which is the government of Singapore's investment vehicle led the $25 million round along with Saverin's company for CXA Group. Other investors like a unit of Reinsurance Group of America Inc., RGAx and Royal Philip NV along with BioVeda Capital joined in. From data management to insurance, CXA has been striving to create a marketplace online for services related health. It is one of the many startups who are trying to make this a reality.
CXA was founded by Rosaline Koo, the Chief Executive Officer. The group now earns a revenue of $10 million ($7 million) annually.
20th February 2017
Singapore pressurised to raise tax deduction on medical expenses
Many residents of Singapore are starting to grow older and are leading unhealthy lifestyles. One in four Singaporeans above 40 years old is suffering from at least one chronic diseases. The high costs of medical treatment are restricting individuals from getting good healthcare. Deloitte Singapore holds that this should force companies to give higher health benefits to their employees.
Deloitte suggests that companies should raise the cap on tax deduction for medical expenditures. The firm said that expenditures related to preventive health screenings should be completely deductible as this move will help individuals in tackling chronic health diseases.
It also mentioned that the government should reconsider its cap on medical expenses and analyse if the current cap is actually helping employees because the medical expenses these days are much higher than the incomes of most individuals. The firm also recommended that the government should introduce double tax deduction for employees who have crossed the retirement age.
13th January 2017
Union Cabinet passes Surrogacy Bill
The Union Cabinet recently passed a draft bill that is supposed to safeguard the rights of surrogate mothers and make parentage of the children borne by them legal. The bill was recently cleared by a Group of Ministers (GOM) and sent to the Union Cabinet for final approval.The Government recently stated that the absence of a statutory mechanism to control commissioning of surrogacy has created a lot of problems in rural and tribal areas including exploitation of women. The bill has been drafted to prohibit foreigners from commissioning surrogacy in the country and prevent exploitation of women.
05th September 2016
New Health Insurance Premiums Up By 25%
New premiums for health insurance to $106 million in the first half of the year, up by 25% from the previous year. According to Life Insurance Association (LIA) Singapore, much of this rise can be attributed to integrated shield plans (IPs) and riders within a policy. New business premiums also went up by 20% to $844.9 million for the quarter ending June this year, while weighted single-premium product sales during the period were at $282.1 million, higher by 54%.
This indicates a shift of the Singaporean public from choosing a health insurance for the sake of buying the mandatory MediShield Life policy, towards adding value to the policies. MediShield Life offers basic hospitalisation insurance, while IPs allow the insured person more benefits on health-related expenses.
Premiums for private integrated shield plans consist of a portion towards the MediShield plan and another portion for the extra features. Premiums were steady for a year from June 2015-2016, but higher medical costs and insurance claims are affecting the companies’s costs. This is likely to increase the premium amounts in the next 6 months.
18th August 2016
AXA Becomes the Sixth IP Insurer in Singapore
AXA Life, one of the leading French Insurers joined the IP (Integrated Shield Plan) and the rider market in May after seeking approval from the Health Ministry to become the sixth IP provider in Singapore. AXA has been approved to provide 3 new IPs that have been approved by Medisave and will offer cover for private hospitals, public hospitals Class A and Class B wards. This new addition to the insurance sphere will offer Singaporeans with a wider range of choices in insurance plans.
The annual claim limits for both private hospitals as well as public hospitals Class A wards cover have been set at S$1 million and S$550,000 respectively. These limits are currently the highest in the market. The usual cover that other IP insurers in the market are presently offering are annual claim limit range between S$600,000 and S$700,000 for up to 180 days post hospitalization.
In addition to offering the highest annual claim limits, AXA is also the first insurer on the island to provide a home care rider which will cover home visits by home nurses, general practitioners and other medical service providers at home including physiotherapy etc. to patients’ homes.
12th July 2016
New Health Premiums Down by 13% but Weighted New Business Premiums Grows by 8%
New Health Premiums that totaled to an amount of SGD 231 in the year 2015 has seen a drop of 13% when compared to 2014 as reported by the LIA Singapore (Life Insurance Association). However, even with this drop, the overall industry still managed to grow by 8% year on year, thanks to weighted new business premiums that totaled to SGD 3 billion in 2015 even with tighter regulatory standards being implemented by the FAIR (Financial Advisory Industry Review) and with the introduction of MediShield Life.
Weighted annual premium products grew by 7% totaling to SGD 2 billion and weighted single premium products grew by 9% totaling to SGD 940.8 million. Of these weighted single premium products, 16% consisted of policies funded by CPF.
The debut of DPI products (Direct Purchase Insurance) in the month of April 2015, bagged almost SGD 550, 000 worth of weighted new premiums. DPI products are basic life insurance plans which are sold without any financial advice and can be purchased directly from websites or customer service centres of different life insurance companies within Singapore.
The life insurance industry in 2015 paid out a total of SGD 5.97 billion to policyholders and beneficiaries.
16th February 2016
Experts Want Tax Deductions for Health Insurance Policies
Tax experts in Singapore are now urging policymakers to provide tax deductions to Singaporeans who are paying health and related insurance policies. This is in lieu of providing enhanced support because of the increasing healthcare costs on the island.
Wu Soo Mee who is a Partner and People Advisory Services – Mobility (Tax) for Ernst & Young Solutions LLP is of the opinion that when tax deductions are not tied to CPF Contributions and capped to a maximum of SGD 5000 for premiums that are paid for health / medical and related insurance policies, it will encourage the taxpaying individuals to take better care of themselves as well as their families. He also continued to add that by enabling a tax write off for health insurance and related premiums, taxpayers will have a greater access to emergency as well as preventive healthcare. Presently, individuals who are paying premiums on health and medical related insurance policies have no tax relief over this financial strain.
Jill Lim who is a Partner and Head of Global Employer Services for Deloitte Singapore as well as Southeast Asia, further added that even though the government has taken numerous steps to tackle the increasing healthcare costs on the island through the introduction of Medishield Life scheme, building more childcare centres etc. there has not yet been any support from the perspective of tax reduction.
Therefore, by providing tax relief to individuals paying for health and medical related insurance premiums for themselves, their spouse, their elderly parents and their children, the financial burden can be lessened in lieu of the increasing healthcare and medical costs in Singapore, thereby promoting individual responsibility over health care needs.
15th February 2016
MediShield Life Has A Positive Impact on Singaporeans
MediShield Life is a universal health insurance scheme that also provides coverage for illnesses that are pre-existing and it was launched in Nov, 2015. In Dec, 2015 a total amount of SGD 37.2 million was approved under this life insurance scheme for meeting the claims of 27,700 policy holders who made claims under the MediShield Life insurance scheme. Many Singaporeans have praised this scheme and have explained how it has made healthcare services more affordable for them. MediShield Life offer enhanced and comprehensive coverage and offers more benefits than the MediShield insurance scheme.
02nd February 2016
Singapore to Enhance its healthcare Capabilities For Meeting The Needs of An Ageing Population
Singapore will continue taking steps for improving the healthcare system in the country so that it can meet the rising demand for healthcare services from an aging population. By 2030, the number of people in the age group of 65 and above will increase to 900,000 from 430,000. Thus, the number of elderly people in the country will double in comparison to their current population which is 430,000. As a result, there will be a huge increase in the demand for variety of healthcare services. Many different types of insurance policies have been launched in the country, in the last few years to ramp up the healthcare system in the country.
In a positive step towards enhancing the healthcare capabilities of the country, MediShield Life insurance policy was launched in November, 2015 and this policy offers insurance cover from birth till death and so it can be ideal for the elderly. In fact, there is also a plan to launch a standard B1 plan in 2016 and this plan will be applicable for all the 5 insurers in Singapore who offer insurance schemes connected with private rates. Apart from that other steps have also been taken, such as opening of 2 new community hospitals in 2015 in order to meet the healthcare needs of the people in Singapore.
03rd January 2016