What is ElderShield?

ElderShield is a Long-Term Care insurance scheme that Singaporeans are enrolled in on an opt-out basis when they reach the age of 40 years old. It is designed to provide a monthly payout to the insured upon severe disability typically associated with old age (hence the name).

Similar to MediShield, the premiums are payable by a CPF Member’s Medisave account, and there are optional supplements to be purchased with private insurers (as of writing, three insurers offer such supplements).

What constitutes “severe disability”? It is the inability to perform at least 3 of the following defined Activities of Daily Living (ADLs):

  • Washing
  • Dressing
  • Feeding
  • Toileting
  • Mobility
  • Transferring

The payout is meant for the insured to cope with a higher cost of living due to impairment, such as nursing home fees or expenses for domestic help.

Types of schemes

There are currently two ElderShield schemes – ElderShield300 and ElderShield400. As the name suggests, ElderShield300 provides a payout of $300 per month for a maximum of 60 months. ElderShield400 provides a monthly payout of $400 for a longer duration of up to 72 months. ElderShield supplements allow one to increase his or her payout amount as well as the duration of payout, up to a lifetime if desired. The amount payable by one’s Medisave for such a policy is capped at $600 per year per person insured. There are quite a few configurations of such supplements available so one should speak with a financial adviser for advice.

Who should take up such a policy?

People 40 and above may want to seriously consider taking up a supplement plan to alleviate the burden one can cause to family members in such a situation. People with parents should insure them to avoid potential financial impact. Having a monthly payout in the unfortunate situation also provides one with better options to be filial rather than to send one’s aged parents to JB.

There are murmurings on the grapevine that the government is considering lowering the entry age to 35. Accordingly, I suggest a rename of the scheme. The current name invokes a rather negative stigma with age-sensitive people, and perhaps also a little misleading. Are young people immune to becoming severely disabled? Hmmm…

Thumbs up to keep me writing more!

3 responses.

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  • Reply
    patrick lim said 2186 days ago:

    hi, seth,

    eldershield or long term care insurance should not be classifed as ‘typically associated with old age’, although the name suggests this is so.

    on this, please allow me to quote from one source which is wikipedia:

    “Age is not a determining factor in needing long-term care.

    About 60 percent of individuals over age 65 will require at least some type of long-term care services during their lifetime.

    About 40% of those receiving long-term care today are between 18 and 64.”

    that’s right, patients can even be as young as teenagers.

    in fact, when mr khaw boon wan, who was then our health minister was quoted as having said to consider lowering the entry age for eldershield to either 35 years or even 30 years.

    and in his keynote Address by Mr Lim Hng Kiang, Minister for Trade and Industry, and Deputy Chairman, Monetary Authority of Singapore at the 25th pacific insurance conference held at marina bay sand convention centre on monday, september 12, 2011, he touched on long term care insurance and said:

    “Insurance products catering to longevity risks neednot be purchased only when one approaches old age. Delaying the purchase of long-term care insurance until the onset of old age may result in more expensive premiums or failing underwriting tests. In the US, the average age of purchasers of long-term care insurance products has steadily fallen from 72 years in 1990 to 55 today, suggesting a rising awareness of the need to purchase such products earlier. Arising from this trend, long-term care insurance is now commonly offered to working adults in the USA.”

    my take is that our government in their review of eldershield will:

    a. lower the entry age and
    b. enhance the monthly income benefit to at least $800 (for 8 years).

    just my 2 cents’ worth.

    • Reply
      Seth said 2186 days ago:

      Hi Patrick, I definitely agree with you, which is why I mentioned that the name is actually a bit misleading at the end of my article.

  • Reply
    patrick lim said 2186 days ago:

    hi, seth,

    thank u for your response.

    we should continue to emphasise and educate consumers that eldershield, although a misnomer in your opinion and mine, is not a elderly solution for severe disability as the evidence from the statistics from usa and perhaps many other countries in the world as well.

    in fact, when long term care porducts were available from the stables of both john hancock and uob life, i recommended this solution to young consumers like yourself.

    why?

    at such an entry age, the pricing of the premiums were truly ‘affordable’ as compared to coming in at age 40 years. and although the pricing of premiums were reviewable and non-guaranteed, the premiums were based on the entry age and the earlier the inception, the lower the premiums charged.

    unfortunately, bogh john hancock and uob life* are no longer in existence and hence, those who did not take up this solution at that point in time, can no longer do so.

    *john hancock has been merged with manulife singapore pte ltd and uob life bought by prudential assurance company singapore pte ltd.

    again, my 2 cents’ worth.

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