facebookAll my agents friend keep stressing the important to upgrade to careshield plus. Is it really important? Anyone here thinks it not necessary? - Seedly

Anonymous

05 Apr 2022

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Insurance

All my agents friend keep stressing the important to upgrade to careshield plus. Is it really important? Anyone here thinks it not necessary?

Discussion (4)

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Yes, i think it’s important especially if you think that the payout from careshield life won’t be sufficient enough to meet your future needs (especially since life expectancy is increasing nowadays). this article explains some of it + shares more about careshield life supplement schemes

Elijah Lee

10 Apr 2022

Senior Financial Services Manager at Phillip Securities (Jurong East)

Hi anon,

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You can look at it this way. There are really only two options.

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(A) You choose not to buy the careshield life (CSL) supplement.

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Life goes on. Two things happen.

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  1. You never need the payout because you lived a long and happy life. That's great. Medisave money continues to garner interest, spilling over to SA, etc.
  2. Something happens, and you need the payout. And that CSL payout is probably $1000/mth adjusted for inflation by the time you claim (let's say). That helps, but if that's 30 years down the road, you have to think about whether that is enough for things like nursing care, or even a maid to look after you. Financially the burden will fall on your family, as long as you need the care. And for how long, we won't really know.

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(B) You choose to buy the CSL supplement.

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Again, life goes on. Two things happen.

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  1. You never need the payout because you lived a long and happy life. That's great. You'll just have lesser spill over from MA to SA, so maybe $60K lesser for retirement
  2. Something happens, and you need the payout. And that CSL payout with the supplement payout is probably like $2500/mth (an extra $18K/yr) adjusted for inflation by the time you claim (let's say). That is better than $1000/mth in the first scenario.

The risk of not buying, is just that if you have to claim, you will only have CSL to fall back on.

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The risk of buying, is that if you don't claim, the premiums will just go to the insurer's risk pool to pay out to those who have to claim. That's how it works anyway.

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You have to decide which you prefer.

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And personally, I would rather have the knowledge that if something happens, my family will have resources available to cope with the expected care of long term costs. While we may never know how much it truly costs, having $2000 or $3000 a mth is better than $1000 a month, and it probably isn't going to cost a bomb, premiums wise. So I have upgraded my own careshield coverage as part of being responsible to me and my wife (and maybe my kids in future if I start a family).

Aven

05 Apr 2022

Financial Planner at Great Eastern

I am assuming "careshield plus" is the supplementary policies that insurance company pays? Different...

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