Last Updated on August 13, 2021
In this time of a global pandemic, you might wonder if it’s too late to begin looking for private insurance policies. Many wonder what areas are lacking compared with basic insurance coverage that they might already have. Here’s a handy guide to getting you on the right track.
1. Why Do I Need Private Insurance?
Regardless of age, all of us can potentially fall ill, or meet with an accident. And although we don’t consider this at a young age, post-retirement requires planning, especially if you’re no longer covered by employment benefits.
In addition, people move on from job to job, so we cannot solely depend on company coverage — which more often than not, only fulfills the base minimum anyway.
An important point to note is that if the current company you’re in switches to a new insurance provider, or in the event that you change jobs, there will be a 12 month waiting period for pre-existing conditions, so you will not be covered during that period.
There are also some insurers that may choose to exclude the coverage for some employees with pre-existing conditions.
Another important point to note is that should you be hit with a long-term ailment, such as cancer, you will therefore not be covered under the company’s basic plan, and you then will not be able to purchase a new private insurance plan at that point.
This therefore makes the decision of purchasing private insurance over and above your company’s insurance plan even more pertinent.
2. Think About Insurance as a Spare Battery Pack For Your Family and Loved Ones
Just as you would keep a spare battery pack for your phone, think about private insurance as a form of a back up plan in the event of unexpected circumstances. We don’t always get to predict what happens, but we can always be prepared for when something serious hits.
This is especially important if you have family members who rely on you financially, and whom you might need to take care of in later years. Being adequately covered isn’t just for yourself — it is also for your loved ones should something happen to you.
This is a back up plan not just for yourself – but also for your loved ones. Caring for them is seeking out a plan for a rainy day. In the event of an accident or illness, you don’t want to saddle your family with a hefty bill.
3. Singapore Is Not A Welfare State – Healthcare Is Not Free
Unlike other countries, healthcare in Singapore is not always free. There may be government policies and grants that may subsidize the cost of healthcare, but it won’t be completely free of charge.
This is even more apparent when specialists are needed for more complicated cases. For example, in long-term disabilities, you’ll require doctors’ visits and checkups, but also medical care at home, modifications to your home and long-term rehabilitative care, amongst other related costs.
4. What To Look Out For In Private Insurance
Here are a few factors to consider when picking a policy most suited for you. Some of these are: the insurance premium, deductibles, co-insurance amounts, the claims process, exclusions, as well as the lifetime renewal options.
First, ensure that you are being covered for the class of hospitals that you wish to visit should you fall sick. For example, make sure to not purchase a public hospital insurance coverage, then visit a private hospital later.
Second, be aware that with the current co-payment scheme, there is typically a 5% co-payment required on the integrated shield plan bought after March 8th, 2019. You can read more about that here. This is so that you can make sure that you have ample emergency funds or ensure that your employee insurance covers the 5% as mentioned. Read more here.
Third, ensure that you purchase your plan early in order to avoid exclusion clauses in the event of pre-existing conditions arising.
Fourth, for foreigners working in Singapore, if you intend to stay in Singapore for the long haul, consider purchasing the integrated shield plan. You’ll be under the foreigner pricing, but will be able to convert it later should you become a Permanent Resident here. If you are a dependent of a Singaporean, you can use your Medisave to pay for it.
If you don’t plan to be in Singapore long-term, make sure your home country coverage is sufficient.
Finally, private coverage does not negate government coverage. Both types of coverage work together to provide Singaporeans with cost-effective options for their needs. Balance the private insurance options against the government’s existing healthcare schemes.