CareShield VS ElderShield: What’s the difference?

A report noted that elderly medical expenditure will rise up to ten times the current amount by 2030. Coupled with a general rise in the cost of living, especially in Singapore, there is a dire need for insurance coverage. Fortunately, Singapore has such coverage. To get a better understanding of the cover, one has to first understand the difference in CareShield vs ElderShield.

The government of Singapore acknowledges the fact that the city-state is among the most expensive places to live in. With this in mind, the authorities thought about ways and means to protect Singaporeans as they age. 

This is not to say that Singaporeans do not have plans for their old age. However, people may get into saving schemes that might not work for them as they would desire. Further, a government-run program seems more trusted. 

ElderShield Insurance Scheme

In 2002, the government of Singapore embarked on a deliberate program to provide cover for ageing Singaporeans. Dubbed ElderShield, the program would specifically protect Singaporeans in the fragile period of their old age.

Specifically, the insurance scheme protects against potentially catastrophic long-term care costs. Realising that old people are prone to debilitating disabilities, the scheme offers long-term comfort. Basically, the scheme covers the costs for help with old-age induced disabilities. 

Policyholders under this scheme enjoy various other benefits apart from cost coverage.  

The scheme provides a monthly payout to the policyholders depending on the type of policy the hold. In particular, for those who joined the scheme between 2002 and 2007, they get monthly payouts of $300. They are eligible for the payouts for up to 5 years. On the other hand, those who joined the scheme after 2007 get a monthly payout of $400. The payout goes for up to six years. 

Further, policyholders begin getting the payout once they hit 65 years of age. However, policyholders can claim their premiums at any age in case of a disability.

In the case of paying premiums, policyholders can pay from their pockets or from their Medisave accounts. Interestingly, the scheme provides long-term cover as opposed to MediShield Life. Not to confuse the two, MediShield Life is a basic cover for hospitalisation and related needs. 

Since the time of inception, ElderShield remains an optional scheme. Also, it does not have age restrictions in terms of entry.

CareShield Life Insurance Scheme

Over the years, there arose calls to amend the ElderShield scheme to reflect the dynamic nature of old age. Further, Singaporeans decried the little monthly payouts. In response, the Ministry of Health (MOH) constituted the ElderShield Review Committee to look into the issues.

In May this year, the Committee gave its recommendations in a report. The highlight of the report was a recommendation for an upgraded old-age insurance scheme dubbed CareShield Life Insurance. As per the report, the new scheme will come into effect in 2020.

There are subtle yet significant differences between the old scheme and the new one. Firstly, the program is compulsory as opposed to the voluntary nature of ElderShield. 

Further, the scheme incorporates higher monthly payouts of up to $600 per month. Also, policyholders will receive lifetime payouts the moment they get to age 67. However, they have the option of earlier claims in case of disabilities.

Another feature of CareShield that differs from ElderShield is the fact that monthly payouts increase over time. Further, the policyholders can lose their cover in the case that they are unable to pay their annual premiums. The government has in place mechanisms to take care of such claims.

Interestingly, the new scheme requires that any Singaporean of age 30 to 40 gets automatic cover from CareShield. For the younger cohorts, they will also get automatic cover once they hit 30 years old. Such guidelines do not exist in ElderShield.