Is Careshield Life a rip-off?

Hi anon,

Let's look at this term 'rip-off'. This means to cheat someone, or something.

So, if premiums were collected and nothing was paid out even if there were people who met the claim criteria, that's a rip off.

However I personally know of a couple of people who are claiming on their Eldershield (only because they were above 40), so that debunks the rip-off myth. Immediately. There's no doubt in my mind that if they were younger than 40, Careshield would be paying the claims instead.

The chances of disability will vary, depending on age and gender. However, it is most definitely not zero, or else schemes like Careshield Life would be a complete waste of government resources as well as the people who have worked on it to come up with the details such as premiums and scope of coverage.

As the chances of severe disability tend to skew more towards those who are generally older at the moment, people who are on Careshield now are unlikely to be currently disabled. So the premiums collected now are going to the risk pool and will wait to be paid out. This will occur a lot later on as our population ages and more people start to live longer lives but in poor health. Due to our aging population, plenty of claims will come a lot later, while we have the capability to pay our premiums into the risk pool, we should, so that when something happens and we need the money, we can claim.

Hi Anon, the government did actually cover this in an article! I think it will answer your question :)

https://www.gov.sg/article/did-the-government-i...

Current prevalence rate of Persons with Disabilities (PwDs) in Singapore is as follows:

Student Population: 2.1% of student population

18-49 years: 3.4% of resident population

50 years and above: 13.3% of resident population

Source: MSF (https://www.msf.gov.sg/media-room/Pages/Total-n...)

Insurance is a form of risk-pooling. Best not to calculate it base on the probability or likelihood that it will happen to us but deciding whether or not we want to self-insure or transfer the risk SHOULD that scenario happen.

Here are some considerations:

• We expect that 1 in 2 healthy Singaporeans aged 65 could become severely disabled in their lifetime, and may need long-term care. (Source: careshieldlife.gov.sg)

• Singapore has one of the longest life expectancy in the world: Average S'porean enjoys longest span of good health, but years spent in poor health also up (Source: The Straits Times)

• What are the causes of disability? It's no suprise, we can't control these factors. (Source: https://www.moh.gov.sg/resources-statistics/sin...)

• Compared to the previous LTC (Eldershield), this time the government don't allow any opt-out. That is how real this issue is becoming. Also, our population is ageing very quickly.

• We are definitely a sandwich generation now, the question is - IF it happens to us, do we want to pass this financial burden on to our loved ones?

Actually it's a no-brainer, because the cost of disability is very high. Likely even with a family unit, we won't be able to support one another in the event of a disability, else it'll be extremely straining on one's finances. The government is plannning ahead for us - only time will tell when half our population becomes aged by 2050 and all the claims start coming in.