Last updated on March 20th, 2018 at 06:15 pm
1. What is Eldershield?
ElderShield is our Singapore public severe disability insurance scheme. It is part of a social safety net that includes Medishield Life and CPF Life, to manage the challenges of a rapidly aging society.
You can use the plan’s payout to pay for your long term care expenses incurred during your disability.
In the event of severe disability, ElderShield policyholders will receive $400 monthly cash payout, up to 72 months (for new entry after Sep 2007).
You will be enrolled automatically in the plan when you reach the age of 40 unless you chose to opt out.
2. What is “Severe Disability”?
“Severe disability” is the inability to perform at least three (3) of the six Activities of Daily Living (ADLs).
3. Is it important to have it?
When you are down with severity disability, you have to depend on someone to take care of you aka your caregiver. These severe disabilities can be due to chronic medical conditions or permanent disabilities caused by old age, accident, or illness.
Ailments like stroke, which usually appear later in life, are showing up at a younger age.
During Singapore National Rally 2016, our Prime Minister Lee Hsien Loong said that one in two persons will have a long-term disability, and will not be able to look after themselves at some point in their lives.
Long Term Care can be costly and prolonged for a long period. The correct question to ask is, “Can my finances withstand the continuous draining of my lifelong savings?”
Source: The Straits Times, “Similar trend for stroke cases likely in Singapore,” 11 February 2011
4. Is the premium expensive? Do I need to Pay by Cash?
You can pay the entire premium using your CPF Medisave account only. The annual premium is $174 for a male at Age 40 and $217 for a female for the next 26 years. This can be fully funded by your Medisave interest if you have $5,500 and more in your Medisave account, as 4% is payable on the balance in your Medisave account.
Eldershield is payable till age65 only. Then its fully paid and you own it!
5. Is it hard to claim?
There have been 12,500 successful claims since Eldershield was launched in 2002, amounting to $90 million being paid as reported by Channelnewsasia.
On the technicality side, in my opinion, conditions to claim based on ADLSs definitions is wider than your conventional Total and Permanent Disability (TPD). Since you have always attached TPD to your life insurance, why not have an eldershield too?
6. Is Eldershield sufficient to meet my Long Term Care Needs?
There are two aspects to this:
a) The sufficiency of the payment amount
Low Payment Amount – Based on Aviva’s Long Term Care Study in 2011, claimants on average require $2,150 per month to employ a caregiver (domestic helper) or to admit into a nursing home. Medical treatment or speech therapy occupational therapy and physiotherapy may also require, improving your chance of recovery. On top of this necessities, you may need to buy/rent mobility aids such as wheel chair and not forgetting you have to pay for daily expenses and utility bills. For more information on the cost of long term care services, click here.
b) The adequacy in the period of payment.
Short Period of Payment – Based on Statistics Singapore Newsletter, Sep 2011, Caregiving in Singapore, approximate 1 in 3 caregivers have been providing care to their recipients for more than 10 years!
As you can see, $400 per month is not sufficient and up to 72 months is also not adequate. Therefore, Eldershield is a definitive answer “NOT ENOUGH”!