If you’re born within 1980 to 1990, take note of this new Government policy called “CareShield Life” because you will be the first batch affected by the changes.
From 2020 onward, you will automatically be enrolled into CareShield Life which is a compulsory long-term insurance scheme for severe disability.
It’s an enhanced version of the Eldershield system and is targeted at those born in 1980 and after.
Those born in 1979 or earlier can also choose to be covered by CareShield Life but it will not be compulsory for them.
Here’s what you really need to know about CareShield Life:
1) It’s compulsory
Unlike the Eldershield system where it allows you to opt out, CareShield Life doesn’t allow you to do that. All Singaporeans and PRs aged between 30 to 40 in 2020 will automatically be opted into the system. Future cohorts will join at 30.
If you’re above 40 in 2020 (born in 1979 and earlier), there’ll be no obligation for you to join the scheme if you’ve opted out.
2) Pay till 67 years old
If you’re turning 30 in 2020, you will have to pay $206 (male) or $254 (female) for the first year. If you’re turning 40 in 2020, your first year premium will be $295 (male) or $366 (female).
You’ll have to pay till 67 years old (or later if re-employment age increases).
By the way, females pay more premiums because they usually outlive men.
3) Lifelong payout
Unlike Eldershield which only pays $400 for up to six years, CareShield Life payout is lifelong – for as long as the person remains severely disabled.
The estimated payout is at least $600 a month for disabled policyholders.
If you become severely disabled 25 years later, your payout will more more than what you would have received if you become severely disabled within the first year of joining the scheme.
4) Payouts > premiums
Assuming you starting paying premiums at age 30 and have paid till 67 years old, the total premiums paid would be $11,300.
If you become severely disabled at age 67 and remain disabled till 76, you will receive $144,000 (based on $1,200 payout a month for 10 years).
The total payout would be 12 times more than premiums paid!
5) Paid by Medisave
Premiums can be fully paid by Medisave.
6) No exclusions
People with pre-existing conditions or disabilities will be included.
In a nutshell
Featured image: The New Paper