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Is my insurance agent friend scaring me? (MediShield Life, free medical insurance and hospitalisation?)

Friday, August 28, 2015

UPDATED (26 DEC 16):

"Recently, my friend who got into insurance gave me his sales pitch about how Medishield Life is inadequate..."
"Well, you said it was a sales pitch. ;)
If we are OK with staying in Class C and B2 wards, Medishield Life is enough. This is a fact."

Medishield Life is inadequate if we wish to stay in Class B2 or A wards. For these, consider getting a private shield plan which could be free too.

FREE? Yes, it is possible.

Now, if you are a regular reader of my blog, you would know that I blog about the importance of having H&S insurance coverage. 

We can budget for the annual premium of a H&S policy more easily than budgeting for the cost of hospitalisation if it should happen.

Yes, who knows how much any visit to the hospital might cost?

What if we were able to budget for the cost of hospitalisation? What? Is AK going to reveal some secret of the century?

Well, it might seem magical but it really isn't.

Remember how I shared how we could get free medical insurance in Singapore? Yes, it is another magical non-magical thing.

So, how could we budget for the cost of hospitalisation?

The answer is quite simple. Get a rider!

Some of you might remember that I blogged about this before. With a rider I purchased for my H&S policy, the maximum that I would have to pay in any year in case I should be hospitalised is $3,000 and not a penny more.

So, not only do I know how much I would have to pay for my H&S insurance coverage each year. I also know the maximum amount I might have to pay in each year in case I stayed at a hospital.

This knowledge gives peace of mind.

Now, what about not having to pay anything at all? What? Am I going to talk about getting free H&S coverage again?

No, no. I mean what about having the H&S policy and rider pay for everything in case we should be hospitalised? 

Yes, what about not even having to pay a single cent in case we should be hospitalised?

Well, here is a conversation I had recently with a reader:

  • L

    Been a follower of your blog for years but only recently I found out you have a Facebook account too. Wanted to seek your opinion on the NTUC income shield. After reading your post on H&S insurance, I am also looking at getting the assist rider plus with 10% co pay but cap at 3k. But I can't decide between advantage and preferred. Is it necessary to get the preferred over advantage? If you do not mind sharing, I guess you get the preferred plan? tongue emoticon

  • Assi AK

    Assi AK
    I got the Preferred Plan because I want to have options. smile emoticon

    It is not a need. It is a want. ;p

  • L
    haha thanks AK for being so truthful with me. There is a new rider called Assist Rider that covers 100% instead of the rider plus that co pay 10% cap at 3k. Wonder what is your views on this and why you didn't change to the new rider? Its a little more expensive than the rider plus but can downgrade next time without penalty to rider plus when older and premium higher.. i am wondering did i miss out any catch to this and why master AK didn't upgrade to this rider tongue emoticon
  • Sorry AK, should be the other way round. plus rider is the one cover 100% while rider assist is the co pay 10% cap at 3k tongue emoticon

  • Assi AK

    Assi AK
    For me, getting well insured for H&S is about having options that I would like to have and also knowing the absolute maximum sum that I might have to pay in any given year.

    The Assist Rider does that for me. So, I don't see the need to upgrade the rider for me.

    I see the upgraded rider more as a want and not a need when paying a max of $3K a year for H&S is not going cripple my personal finances.

    However, the rider is cheaper when we are younger and gets progressively dearer as we age just like the H&S policy. So, for younger people, it might make sense to get the plus rider and later downgrade to the assist rider when they are stronger financially. When they are older, that is when the riders become more expensive too.

We need H&S coverage but do we need more than the soon to be launched Medishield Life? If we would like to have more than Medishield Life, do we need a rider?

Apart from considering what we need and what we want, we should always consider our situations and the options available to decide what is best for us. Only we have the answers.

Finally, please read the documents and be very clear what we are buying before we sign on the dotted line.

I don't want buy something later end up can't claim

Assi AK
Assi AK
Be very careful before signing any document... Read carefully

Sometime your agent only said this is this after that some sign on the dot never read

Assi AK
Assi AK
Must read...
Sometime don't understand the chim word

Assi AK
Assi AK
Check dictionary...

Remember, no one cares more about our money than we do. Similarly, no one cares more about what we are buying than we do. 

If we care enough to know exactly what we are buying, we should care enough to check carefully before signing on the dotted line.

Although more enlightened companies might not say this but we should assume that it is always a case of Caveat Emptor or "let the buyer beware."

Find out more about MediShield Life: here.

Source: Ministry of Health.

Related posts:
1. How to get free medical insurance?
2. Enhanced Incomeshield for my mom.
3. Do you know if your parents have H&S coverage?


AK71 said...

How to go about planning for getting insurance for my parents?
They are not financial literacy thus now that i have a full time job and earning more. i will like to look into getting them adequate insurance coverage

Your parents only need H&S, They should have Medishield Life already. If they are OK with class C and B2 wards, they don't need anything else. 🙂
They don't need life insurance anymore unless they still have dependents.

laurence said...

In today's article in Business Times, Income reportedly intends to increase the IP Rider again, this time by between 8% to 35%.

In Mar 17, Income had already increased the Rider by 10% to 30%. So this is another increase in just 7 months. This is not sustainable. I'll soon be forced to give up the Rider as it rises exponentially as our age increases as well.

"Andrew Yeo, general manager of the life and health business at Income said the insurer raised its private hospital IP premiums by between 5 and 15 per cent for various age groups in March. The prices of a related rider also went up by between 10 and 30 per cent, he said."
"......Mr Yeo said Income is increasing its private hospital rider in October by 8 to 35 per cent - a year after the last hike."

AK71 said...

Healthcare cost is going up and with a rapidly ageing population, more people are claiming H&S insurance benefits. H&S insurance will become more costly as a result.

It is probably better to downgrade the H&S coverage (for example, from private to government hospitals) and to keep the rider. The idea is to reduce out of pocket expenses for when we are hospitalised.

Spur said...

It's a vicious cycle. Hospitals in general & specialists in particular LOVE patients who are covered at A-class & Private level, where they can go the whole nine yards without costs being a factor. These days doctors especially in restructured hospitals, often have to put on an accountant's hat on top of their doctor's hat to justify costs of treatment, why this treatment modality over another, what does the latest medical literature best practices say, etc etc. And most of the medical literature these days have costs & value in mind when discussing outcomes of various options, which MOH & hospital administrators take to heart.

It is also natural for consumers who pay for expensive coverage to also expect the maximum that their plans can bear, and many patients do work out with their specialists on maximizing their H&S plans.

Expensive coverage -- > expensive treatments -- > expensive bills to insurers -- > constant large increases to premiums -- > increased motivation by consumers to claim

With Income raising premiums, the rest of the other insurers will soon follow, particularly for the as-charged full coverage for Private & A-class, which are the highest cost inflation liabilities for S'pore insurers.

I suspect in the future govt may ban full-cover riders for restructured hospitals.

AK71 said...

Hi Spur,

Unfortunately, responsible consumption is not what our society is known for.

So, some form of external control is probably not a bad idea.

AK71 said...

Reader says...
My mom's medisave is a pittance since she does not contribute medisave in the past.

AK says...
Go top up her MA and get 4% interest per annum. 😉
Top up her MA and let the government help you to provide for your mom even more. 🙂

KW said...

I top up for my father's MA for 3 years now.
Every month $100. Last year he earn $420 interest from CPF.
I feel that I will need to 'find' this amount when my father need it. I am a happy man now :)
As AK put it "Top up her MA and let the GOV help you to provide for your mom even more"

AK71 said...

Hi KW,

I always say that it is not magic. It is just math. :)

Gambatte! :D

AK71 said...

Reader said...

My husband is a civil servant and so I enjoyed subsidized healthcare.

He is now close to retirement and suddenly both of us realised, we dont have private insurance like hospitlisation and surgical insurance.

I have pre existing conditions and of course private insurers like ntuc income reject me.

Not long ago, I read in Business Times dd July 16 2018..Raffles Hospital CEO, Dr Loo announced that Raffles will cover 3 pre existing conditions and I was happy cos I have this one insurer who actually cared enough to be inclusive..

I applied and got rejected and I wrote in and ask for an explanation... still waiting..

Suppose I have no PI, what is my next plan for medical coverage?

Blogger AK said...

I believe Medishield Life has both you and your husband covered.

It is compulsory for all CPF members and covers for life.

I am pretty sure it covers pre-existing illnesses too.

However, it is only good for classes C and B2 wards.

If you want more than that, you will need private H&S plans.

WTK said...


My take is that there is no need to take private H&S plans for one who prefers the minimalist treatment. Medishield Life is the most appropriate option.


AK71 said...

Hi Ben,

For people who wish to have more privacy or more treatment options, private H&S plans will be more appropriate.

It depends on what we want and what gives us peace of mind.

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