​Understanding health insurance

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November 05, 2018 | 4 min. read

Health insurance helps pay for your healthcare costs if you get injured, sick or disabled. Find out what health insurance covers, how it works and why you need to be insured.

Key takeaways

  • Health insurance helps pay for health care costs in the event of an injury, illness or disability.
  • All Singaporeans are covered under MediShield Life, a basic government health plan to cover large medical expenses.
  • Apart from medical expense insurance, there are other types of health insurance plans. Know the differences in coverage so that you buy what you need.

What is health insurance?

Health insurance helps you pay for your medical expenses when you fall ill, get injured or become disabled. All Singaporeans are covered under MediShield Life, a basic government health plan to cover large medical expenses. Besides having to deal with large medical or hospital bills, you may not be fit for work during your recovery.

Some health insurance plans will provide you with cash payouts, while others help cover the cost of treatment or nursing care.

There are short-term and long-term policies. Long-term policies cannot be terminated without your consent. For short-term policies, insurers may terminate your policies by informing you in advance.

Be sure to buy a policy which fits your needs. Do note that a new policy may not give you the same coverage as before.

Types of health insurance plans

There are 5 types of health insurance plans. This table shows the different coverage each plan provides:

If you want to You should buy

Cover your hospital and surgical (medical) costs

Medical expense insurance (e.g. MediShield Life and Integrated Shield Plans)

Receive a fixed amount of cash for each day you are in a hospital

Hospital cash insurance

Receive a lump sum to help you with expenses if you are diagnosed with a major illness like cancer

Critical illness insurance

Replace your income when you are disabled and unable to work

Disability income insurance

Pay for the care you need if you're severely disabled

Long-term care or severe disability insurance (e.g. ElderShield and ElderShield Supplements, and CareShield Life from 2020 onwards)

See also: Guide to types of health insurance

Who should buy health insurance?

Singaporeans are already covered by MediShield Life, a compulsory health insurance scheme that pays for basic public hospital treatments.

If you prefer to be admitted to a better type ward or private hospital, you can consider an upgrade to an Integrated Shield Plan with wider coverage.

See how much hospital treatments cost.

There are a few things to consider when choosing a health insurance plan:

  • If you are young and healthy – Check to see if your coverage is enough for you or if you wis to upgrade. Do not wait until you develop health issues to get more cover as the insurer may exclude coverage of that in your policy.
  • If you have a family – Make sure your family has adequate health insurance. Medical emergencies can be costly. Check that the deductibles and co-insurance payments are affordable for the long term.
  • If you are a senior citizen – Check the CPF website to see if you are covered under ElderShield. If you are under 65 and opted out of ElderShield earlier, speak to any of the private insurers to opt back in. Premiums and payouts are the same across all insurers. You'll need a medical assessment. Your application could be rejected if you have a pre-existing illness.

Note

Come 2020, an enhanced long-term care insurance scheme called CareShield Life will be introduced. CareShield Life will feature higher payouts that increase over time, with no cap on payout duration, to provide better protection against the uncertainty of long-term care costs if you become severely disabled.

If you have company health insurance

Find out if you're covered under a group health insurance policy. If so, what are you covered for? The policy may end when you change employer or retire, so you should have a personal health insurance policy as well.

Do not wait until you stop working to buy a health insurance policy. By then, you may not be insurable due to age or poor health.

Choosing your level of coverage

When choosing a policy that suits your healthcare needs, ask yourself these 3 questions:

  1. What basic coverage do I already have?
  2. What additional coverage am I looking for? Do I really need this?
  3. What are my options?

Basic health insurance coverage

As a Singaporean or Permanent Resident, you are already covered under the basic Government health insurance plans:

  • MediShield Life
  • ElderShield (or CareShield Life from 2020) unless you choose to opt out

If you want more coverage

If you have the budget for it, you may want more coverage such as for a higher ward type or the ability to choose your own doctor.

If so, you could choose to upgrade your coverage by getting an Integrated Shield Plan or ElderShield Supplements.

These plans add to your MediShield Life or ElderShield plans. There is no duplication in coverage.

How MediSave fits in

MediSave is a savings account for healthcare expenses, not a health insurance policy. Part of your CPF contributions goes into your MediSave account and this is part of your CPF savings.

You can use your MediSave to pay for you and your immediate family members':

  • Hospitalisation, day surgery and certain outpatient expenses.
  • Premiums for MediShield Life, Integrated Shield Plans, ElderShield and CareShield Life.

Note: There are withdrawal limits on the use of MediSave. Read more on the Ministry of Health (MOH) website.

Assistance under MediFund

You can apply for assistance under the MediFund scheme if you're a Singapore citizen receiving subsidised treatment and have difficulty paying your medical bill at a MediFund-approved institution.

To apply, approach the medical social workers at the MediFund-approved institutions where you have received treatment.

See also:

Last updated on March 15, 2019