5 things you need to know about CareShield Life
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In May 2018, the Ministry of Health (MOH) announced that CareShield Life, a national long-term care insurance, will replace the existing ElderShield in 2020, putting in place another piece of the jigsaw to prepare Singapore for its ageing population. A compulsory government-run scheme, CareShield Life, will offer wider coverage to those with severe disability. Here are five things you need to know about the latest announcements for CareShield Life.\
1. Automatic enrolment for those aged between 30 and 40, from 2020 onwards
Unlike its predecessor, CareShield Life kicks in from age 30 onwards. The optional ElderShield, which is offered by private insurers, only kicks in at age 40. Similar to ElderShield, CareShield Life premiums are payable via one's MediSave.
2. Existing ElderShield members can opt to join CareShield Life, from 2021 onwards
Existing ElderShield cohorts who were born in 1979 or earlier, can choose to join CareShield Life. This includes those who are currently uninsured. There is no maximum entry age for CareShield Life.
Those born between 1970 and 1979, and who are not severely disabled, will be automatically transitioned to CareShield Life in 2021, if they are currently insured under ElderShield 400.
3. Inclusive Underwriting
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Unlike ElderShield, which was administered by private insurers, CareShield Life will be administered by the Singapore government. MOH has highlighted that its underwriting process for CareShield Life would be more inclusive. Every person who is not severely disabled can join CareShield Life in 2021.
4. Increasing pay-out amounts over time
Under CareShield Life, pay-outs upon severe disability will last for life, as long as the claimant remains severely disabled. At its launch in 2020, pay-outs will start at $600 per month, and will increase over time. The pay-outs increase will be concurrently supported by regular premium adjustments, the percentage increase of which is set to be at 2 per cent between 2020 and 2025.
In contrast, the ElderShield scheme pays $400 a month for up to six years, but with lower premiums paid over a shorter period.
5. Premiums for CareShield Life
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On 27th Dec 2018, a new online calculator was launched to help people work out how much they will have to pay when CareShield Life is launched in 2020. The MOH said that the gadget will provide Singapore residents (born between 1946 and 1990) with information about their estimated premiums before and after applicable subsidies and incentives. You can have a shot at it here!
Singaporeans born in 1991 or later will be provided with their premium figures when they are enrolled in the CareShield Life scheme at age 30.
It must be noted that existing cohorts who join CareShield Life will pay a base premium, which will take into account the premiums existing ElderShield 400 policyholders have already paid. Those under ElderShield 300, as well as those not insured under ElderShield, will pay an additional catch-up component, as they would not have paid as much premiums as those in the same cohort who are insured under ElderShield 400.
