Government to provide premium subsidies for enhanced severe disability insurance scheme

Government to provide premium subsidies for enhanced severe disability insurance scheme

workers Singapore file
People walking along Singapore's Central Business District area. (File photo: Ngau Kai Yan)

SINGAPORE: Singaporeans will receive premium subsidies for an enhanced ElderShield scheme that is expected to be implemented in 2020.

The enhanced scheme, called CareShield Life, will provide lifetime coverage and higher payouts that increase over time for Singaporeans and permanent residents aged 30 and older who are severely disabled.

This will need to be supported by higher premiums, the Ministry of Health said on Friday (May 25).

For example, a 40-year-old male will pay S$25 monthly in premiums at the launch of the scheme before subsidies under the enhanced scheme compared to about S$15 under the current ElderShield scheme. The starting premium for a 40-year-old female will be S$30 in monthly premiums under CareShield Life.

However, up to two-thirds of households will be eligible for permanent means-tested subsidies of up to 30 per cent.

Two criteria will be used for means testing: monthly Per Capita Household Income (PCHI) and annual value (AV) of residence.

For example, a Singaporean with a monthly PCHI of S$1,100 and below, will get a 30 per cent subsidy. If he has a PCHI of between S$1,101 and S$1,800, he will get a 25 per cent subsidy, and 20 per cent if the PCHI is between S$1,801 and S$2,600. These rates are based on AV of S$13,000 and less.

Permanent Residents will receive half the rate offered to Singaporeans.


The Government will also give Singaporeans transitional subsidies for the first five years of the scheme.  This will amount to S$250. For the first five years of scheme's implementation, payouts and premiums will both increase by 2 per cent per year.

Additional premium support will also be given to those in financial need and unable to pay despite these subsidies.

These premiums are fully payable by Medisave.

The Government’s support package comes after it accepted recommendations by the ElderShield Review Committee that premiums should be kept affordable and adjusted regularly to account for changes in payout quantum and claims experience.

Speaking to reporters on Saturday, Health Minister Gan Kim Yong said that the Government will include subsidies and incentives to encourage older cohorts to participate in CareShield Life.

“This is an important part of our social safety net for Singaporeans in terms of long term-care needs. This also reflects the inclusive society that we aspire to build,” he said.

An independent council will be set up to advise on subsequent payout and premium adjustments.

“With these measures, CareShield Life premiums will be affordable for all Singapore residents. No one enrolled in CareShield Life will lose coverage due to financial difficulties,” MOH said.

CareShield Life and ElderShield help policyholders who cannot independently perform at least three of six activities of daily living (ADL) - washing, dressing, feeding, using the toilet, moving around and the ability of transferring oneself from a bed to a chair.

When asked by reporters why the number of ADLs was not decreased to two to help more people, chairman of the review committee Chaly Mah said that it would increase premium amounts by 30 per cent, making it less affordable.

Mr Gan said; "The Government is committed to ensuring that the premium will always be affordable. It will take into account personal savings, personal wealth, means as well as balance in Medisave, and what subsidies the Government can offer.". 

Source: CNA/ja