The Singaporean government made a few important announcements recently regarding CareShield Life enrolment, as well as introduced a few attractive incentives for participants.
Firstly, what is CareShield Life?
Back on 1st October 2020, the Singaporean government introduced CareShield Life, a compulsory national long-term care insurance scheme, to help Singaporeans, based on the estimation that one in two Singaporeans at 65 years old is expected to be severely disabled in his/her lifetime.
If you, as a Singaporean citizen, become severely disabled during your old age, CareShield Life will provide basic financial support for your personal and medical care.
CareShield Life premiums are fully payable using MediSave, and you will be paying premiums from the age you joined until 67 years, but remain covered for life. If you need help paying for your premiums, there are government subsidies available. Your premiums will be waived, once you make a successful claim.
Below are the summarised updates from the Ministry of Health (MoH)’s press release on 14th October 2021 and how it will affect you:
|For Singaporeans||How will this update affect you?|
|Born in 1979 or earlier||Participation is optional.
You can apply to join CareShield Life from 6th November 2021 onwards, if you are not severely disabled.
No age limit.
Participation incentives of up to $2,500 are provided by the government when you join CareShield Life by 31st December 2023.
|Born between 1970-1979||If you are insured under ElderShield 400, and not severely disabled, you will be automatically enrolled into CareShield Life from 1st December 2021.
You can opt out by 31st Dec 2023 if you do not want to continue with CareShield Life.
|Born between 1950-1959 (Merdeka and Pioneer Generation)||Participation incentives of up to $2,500 are provided by the government when you join CareShield Life by 31st December 2023.
Additional incentives of $1,500 will be provided.
Should I upgrade my CareShield Life?
Payouts for CareShield Life start from $600 a month in 2020, and will continue to increase for the next five years (until 2025), by 2% p.a., or when a successful claim is made, depending on which is earlier. After 2025, future payouts will differ based on the regular adjustments.
While it is great that the government is increasing CareShield Life payouts over the years, once you make your first claim, your payout amount will remain the same. This means that you will continue to receive the same amount throughout your life, even if the scheme’s payout is increased later in life.
Is $600 a month really enough for you when you are severely disabled and in need of special medical care? You can use up to $200 of your MediSave funds for long-term care needs, under the MediSave Care umbrella, but that too can barely cover the living expenses and help needed for a severely disabled individual.
Unless your family members are willing to take care of you full-time or pay for your living expenses, you should take care of yourself by upgrading your disability protection, so your payouts will be enough for your survival and other help you need. In other words, this is why you should consider getting supplements for your CareShield Life plan.
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This is for general information only and does not constitute financial advice. This advertisement has not been reviewed by the Monetary Authority of Singapore.