Hi anon,
To answer your question on what is careshield, it is a long term care insurance policy that is administered by the government. Given that it is for the masses, you can expect that the coverage is not extremely high.
Interestingly, when it comes to compulsory schemes, the only two insurance schemes that the government has ever made mandatory would be Medishield Life and Careshield Life. Clearly, the government prefers to make risk-pooling the method by which they deal with such risks, which they feel is serious enough to mandate a national scheme.
So how about the supplements? Clearly, the government is only willing to provide a basic level of support, leaving individuals to decide whether they want more coverage or not (a move similar to Medishield Life)
You can look at it this way. There are really only two options.
You choose not to buy the careshield life (CSL) supplement.
Life goes on. Two things happen.
- 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, etc.
- 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.
You choose to buy the CSL supplement.
Again, life goes on. Two things happen.
- 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 lesser funds for retirement, but it is unlikely to be very much lesser.
- Something happens, and you need the payout. And that CSL payout with the supplement payout is probably going to be something like $2500/mth (an extra $18K/yr) adjusted for inflation by the time you claim (let's say). That is far 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.
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.
You have to decide which you prefer.
Thus, if you ask me if it makes sense for me, I'd rather have the increased payout if I am severely disabled rather than not have it. If I never claimed, it just means I'm blessed with good health, which is also a good thing. The premiums were paid from MA and MA monies can't typically be withdrawn anyway, so it's not like I am losing out a lot. Definitely makes sense for me to upgrade (and I have actually done so)
Hi anon,
To answer your question on what is careshield, it is a long term care insurance policy that is administered by the government. Given that it is for the masses, you can expect that the coverage is not extremely high.
Interestingly, when it comes to compulsory schemes, the only two insurance schemes that the government has ever made mandatory would be Medishield Life and Careshield Life. Clearly, the government prefers to make risk-pooling the method by which they deal with such risks, which they feel is serious enough to mandate a national scheme.
So how about the supplements? Clearly, the government is only willing to provide a basic level of support, leaving individuals to decide whether they want more coverage or not (a move similar to Medishield Life)
You can look at it this way. There are really only two options.
You choose not to buy the careshield life (CSL) supplement.
Life goes on. Two things happen.
You choose to buy the CSL supplement.
Again, life goes on. Two things happen.
The risk of not buying, is just that if you have to claim, you will only have CSL to fall back on.
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.
You have to decide which you prefer.
Thus, if you ask me if it makes sense for me, I'd rather have the increased payout if I am severely disabled rather than not have it. If I never claimed, it just means I'm blessed with good health, which is also a good thing. The premiums were paid from MA and MA monies can't typically be withdrawn anyway, so it's not like I am losing out a lot. Definitely makes sense for me to upgrade (and I have actually done so)