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Why You Should Plan For Long-Term Old Age Care, Even If You’re Young

Singapore’s citizens are living longer lives. This increases the need for long-term care as the risk of disability and serious illness increases in old age.

Singapore’s Ministry of Health estimates half of Singaporeans over the age of 65 could become severely disabled in their lifetime. Of these, three in 10 could live with severe disability for 10 years or more.

These disabilities could come from accidents or illnesses, leading to the need for long-term care over a prolonged period.

What is long-term care?

Long-term care refers to the personal and medical care needed when an individual suffers from a disability. There are different types of long-term care:

  • Home-based care
  • Centre-based care
  • Nursing homes

Since 1 Oct 2020, CPF launched a mandatory national insurance scheme called CareShield Life.

Read more: All You Need to Know About CareShield Life

Those who were born between 1980 and 1990 (aged 31 to 41 in 2021) were automatically covered on 1 Oct 2020 or when they turned 30, whichever is later, regardless of pre-existing medical conditions and disability.

If you are born between 1970 to 1979, insured under ElderShield 400, and have not developed severe disability, you have been automatically enrolled onto CareShield Life from 1 December 2021.

What are the benefits of CareShield Life?

CareShield Life benefits are designed to provide you with lifetime coverage for your basic long-term care needs, should you suffer severe disability. These benefits are:

  • Lifetime worldwide coverage
  • Lifetime monthly cash payouts as long as you are severely disabled
  • Monthly cash payouts will start at S$600 in 2020 and increase over time

The claim will be paid out as long as an individual is assessed (by a MOH-accredited severe disability assessor) to be unable to perform at least three of the six Activities of Daily Living (ADLs).

The 6 Activities of Daily Living

Source: MOH website

Is the payout from CareShield Life sufficient to meet your needs?

According to Singlife’s Long-term Care Study done in 2018, you may need an average of S$2,324 per month for the following:

Source: Singlife website
1. Source: Singlife’s Long-term Care Study 2018.
2. Source: Ministry of Health, Long Term Care Financing, retrieved on 6 April 2020 from https://www.careshieldlife.gov.sg/long-term-care/planning-ahead.html.

According to Today, a United Nations report expects Singapore’s population size to reach 6.34 million in 2030.

It found that the life expectancy of Singaporeans will continue to go up. The life expectancies for men and women born in Singapore between 2010 and 2015 are 80.1 and 84.5, respectively. These would increase to 85.6 and 89.3 years respectively for those born here between 2045 and 2050.

With increasing costs in our living expenses including medical care, you must plan early to take care of these costs so that it will not be a financial burden to you and your family.

What can you do to supplement CareShield Life?

There are CareShield supplementary plans offered by private insurance companies to provide additional monthly cash payouts.

How do you know if you are covered under a supplementary plan?

If you are unsure whether you have a supplementary plan, you may check the CPF Board’s website by following these steps:

  1. Visit the CPF website.
  2. Log in using your Singpass.
  3. Hover over “my cpf” and click on “Healthcare” under “My dashboards”.
  4. Click on “Long-term care insurance” on the anchor links or scroll down to the “Long-term care insurance” section.

If you have a supplementary plan, this section will show your insurer, i.e. Singlife, Great Eastern or Income. Do contact your insurer to find out which plan you are covered under.
If you do not have any supplementary plan, this section will not reflect any information.

You can utilise up to S$600 per year per life from your CPF Medisave to pay for the CareShield Life Supplement Plan. If there is an excess of premiums beyond S$600, the remaining will be payable in cash.

Some examples of insurance companies providing such plans in Singapore are Income, Singlife, and Great Eastern.

Let’s take a look at what they provide.

SinglifeIncomeGreat Eastern
Monthly Benefit
100% of Monthly Benefit when unable to perform 2 out of 6 ADLs (Singlife CareShield Plus)100% of Monthly Benefit when unable to perform 2 out of 6 ADLs (Moderately disabled)50% of Monthly Benefit when unable to perform 1 out of 6 ADLs
100% of Monthly Benefit when unable to perform 3 out of 6 ADLs (Singlife CareShield Standard)100% of Monthly Benefit less CareShield Life Benefit when unable to perform 3 out of 6 ADLs (Severely disabled)100% of Monthly Benefit when unable to perform at least 2 out of 6 ADLs
Premium Term Options
Up to policy anniversary after 97th birthday
Up to 67 or 84
(last birthday)
Up to 67 or 95 (last birthday) if entry age is between 30 to 47
Limited payment: Up to policy anniversary after 67th birthday or 20 years from entry age (49 and older), whichever is laterUp to 95 (last birthday) Until Age Last Birthday (ALB) 95 or 20 years if entry age is between 48 to 64
Waiver of PremiumInability to perform at least 1 out of 6 ADLsInability to perform at least 2 out of 6 ADLsInability to perform at least 1 out of 6 ADLs
Initial Lump Sum Support Benefit (One-Time)
3 times the Monthly Benefit
300% of Monthly
Benefit if due to in ability to perform 2 out of 6 ADLs
One lump sum of 3 times the Monthly Benefit payable upon inability to perform only 1 ADL
600% of Monthly Benefit if due to in ability to perform 3 out of 6 ADLs
Monthly Cash Benefit AmountS$200 to S$5,000 per month (in increments of S$100) on top of CareShield Life’s payoutS$1,200 to S$5,000 per month (in increments of S$100). CareShield Life monthly cash benefit is part of the total monthly benefit if claim is due to inability to perform 3 out of 6 ADLsS$300 to S$5,000 per month (in increments of S$100) on top of CareShield Life’s payout
Escalating Payout BenefitOption to Choose Level (2% or 3%)Not ApplicableNot Applicable
Rehabilitation Benefit50% of the last paid out Monthly Benefit if unable to perform at least 2 out of 6 ADLsNot ApplicableNot Applicable
Dependent Care BenefitUpon inability to perform at least 2 out of 6 ADLs if you have a child (below age 22), additional 20% of the monthly benefit for up to 36 monthsIf you have a dependant (below age 21), additional 25% of payout for up to 36 months upon disabled30% of Monthly Benefit upon inability to perform at least 2 out of 6 ADLs, for up to 48 months
Caregiver Relief Benefit60% of Monthly Benefit upon inability to perform at least 2 out of 6 ADLs, for up to 12 monthsNot Applicable60% of Monthly Benefit upon inability to perform at least 2 out of 6 ADLs, for up to 12 months
Death Benefit3 times the last paid out Monthly Benefit or Rehabilitation Benefit300% of Monthly BenefitNot Applicable

Premium comparisons based on at least 2 ADLs

Based on Age 30

Singlife CareShield PlusIncome Care SecureGreat CareShield
Monthly BenefitAnnual PremiumMonthly BenefitAnnual PremiumMonthly BenefitAnnual Premium
Male$1,500.00$592.52$1,900.00$567.41$1,500.00$584.68
Female$1,200.00$590.80$1,600.00$540.11$1,100.00$571.92

Based on Age 35

Singlife CareShield PlusIncome Care SecureGreat CareShield
Monthly BenefitAnnual PremiumMonthly BenefitAnnual PremiumMonthly BenefitAnnual Premium
Male$1,200.00$564.01$1,700.00$587.99$1,200.00$556.68
Female$1,000.00$591.30$1,400.00$523.51$900.00$559.46

*All in Singapore dollars

However, if you feel that going for a CareShield Life Supplement that pays out when the insured is unable to perform 3 out of 6 ADLs, the same as how CareShield Life pays out, you can consider the following examples.

Premium comparisons based on at least 3 ADLs

Based on Age 30

Singlife CareShield Standard
Monthly BenefitAnnual Premium
Male$1,800.00$597.23
Female$1,400.00$575.73

Based on Age 35

Singlife CareShield Standard
Monthly BenefitAnnual Premium
Male$1,500.00$593.83
Female$1,200.00$591.22

*All in Singapore dollars

  • Singlife selected premium payment term is till age 99
  • Income selected premium payment term is till age 84
  • Great Eastern selected premium payment term is till age 95
  • Singlife offers a 20% perpetual discount and rates quoted are after discount
  • Great Eastern offers a 20% perpetual discount and rates quoted are after discount
  • Premiums above are inclusive of the prevailing GST

Read more: Best CareShield Life Supplements

Conclusion

You’re never too young to plan for this, even if you’re covered by other insurance policies.

People who plan early will enjoy additional peace of mind and, perhaps more importantly, a lower entry premium into the CareShield Life Supplement Plan.

Don’t leave the financial risk to your loved ones.

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