CareShield Life is a long-term care insurance scheme introduced by the Singapore Government to provide financial support to individuals in the event they become severely disabled and require long-term care.
It is designed to help Singaporeans cope with the high costs of long-term care, such as nursing home fees, home-based care, and other related expenses.
Different tiers of CareSheild Life
CareShield Life comes in 2 tiers.
Basic Tier
All Singaporeans and PR will automatically be enrolled into the basic tier of CareShield Life when they turn 30. This tier provides basic coverage and payouts upon making a claim.
Upgraded Tier
Eligible Singaporeans and PRs will have the option to upgrade their CareShield Life policy for increased coverage and payouts.
How much will I get paid?
Basic Tier
Under the basic tier, you will be eligible to receive a minimum payout of $600 every month for as long as you fulfill the conditions to be eligible for a claim.
The minimum payout of $600 will increase yearly by 2% from 2020 to 2025 when no claims have been made. After 2025, the rate increments will be decided by the CareShield Life Council.
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
| Monthly Payout Rate | $600 | $612 (+2%) | $624(+2%) | $637(+2%) | $649(+2%) | $662(+2%) |
Upon making a claim, the monthly payout rate will not increase any further.
Upgraded Tier
Under the upgraded tier, you can receive monthly payouts ranging from $800 up to $5000. Just like the basic tier, the monthly payouts will increase yearly for as long as no claims are made. Upon making a claim, the monthly payout rate will not increase any further.
What are the conditions to claim?
Basic Tier
Under the basic tier, you can make a claim when you have been assessed to be unable to perform at least three out of the six Activities of Daily Living (ADLs) listed below.
Additionally, you will also be eligible for a premium waiver of the policy upon making a successful claim.
Upgraded Tier
Under the upgraded tier, you will be eligible to make a claim when you have been assessed to be unable to perform at least two out of the six Activities of Daily Living (ADLs) listed below.
Additionally, you will also be eligible for a premium waiver of the policy upon making a successful claim.
Washing
The ability to wash yourself
Dressing
The ability to dress yourself
Feeding
The ability to feed yourself
Toileting
The ability to use the toilet on your own
Walking
The ability to walk
Transferring
The ability to move from a bed to a chair (vice-versa)
Read More: CareShield Life Claims
How much does it cost?
In most cases, CareShield Life has the option to be fully funded using your Medisave with no cash outlay necessary.
Basic Tier
You can check your personalized premiums and subsidies here.
Upgraded Tier
Please consult with a trusted Financial Adviser for an accurate cost of upgrading.
Get your personalized financial strategy here
Pros and Cons of CareShield Life
Here are some key aspects of CareShield Life, along with its pros and cons:
Pros:
- Financial Protection: CareShield Life provides a lifelong payout to individuals who are severely disabled, ensuring that they have financial support to cover their care needs. The payout can help alleviate the financial burden on the individual and their family.
- Universal Coverage: It is a compulsory scheme for all Singaporeans and Permanent Residents (PRs) from the age of 30 to 40, depending on their birth year. This ensures broad coverage and risk pooling, making it more financially sustainable.
- Affordable Premiums: Premiums for CareShield Life are designed to be affordable and can be paid using Medisave (a government medical savings account). Subsidies are available for lower-income individuals, making it accessible to a wide range of people.
- Lifetime Coverage: CareShield Life provides coverage for life, so individuals do not need to worry about outliving their insurance coverage.
Cons:
- Limited Choice: CareShield Life is a standardized insurance plan, and individuals do not have much flexibility to choose different coverage levels or customize their insurance to their specific needs.
- Not a Complete Solution: CareShield Life is designed to provide financial support for long-term care needs, but it may not cover all expenses, especially for individuals with very high care costs. It’s important for individuals to plan for additional financial support if necessary.
Is it Worth Upgrading?
Well, the short answer is definitely yes, provided you can afford it.
In most cases, you are able to upgrade your CareShield Life coverage using 100% of your Medisave with no additional cash involved. This means that you are buying extra coverage and protection without having to compromise your finances.
Conclusion
In conclusion, CareShield Life in Singapore is a government-mandated long-term care insurance scheme that offers financial protection and support to individuals who become severely disabled. While it has several advantages, such as universal coverage and affordability, it also has limitations, including mandatory participation and potential premium increases.
It’s important for individuals to understand the scheme and consider their individual financial needs and circumstances when evaluating its pros and cons.
