Insurance

Our honest opinions about CareShield Life and its supplements

This is what we really think about CareShield Life.

  • Phuan Wei Ning
  • |
  • Published on 18 Nov 2020

What is CareShield Life?

A form of disability insurance, CareShield Life provides basic financial support for all Singaporeans should they become severely disabled. This is defined as the inability to perform at least 3 out of 6 Activities of Daily Living (ADLs) with the six ADLs being washing, dressing, walking, feeding, transferring and toileting.

Starting from 1 October 2020, all Singaporeans and Permanent Residents (PRs) vwho were born in 1980 or later will be automatically enrolled into CareShield Life at the age of 30. If you are born in 1979 or earlier and wish to switch to CareShield Life, you may do so in 2021 if you are not severely disabled. Transitional subsidies are also available from 2020 to 2024 to help Singaporeans with the transition to CareShield Life.1

(See "Cheap Critical Illness Cover For Those In Their 30s")


What are the differences between ElderShield and CareShield Life?

ElderShield
CareShield Life
Entry age
Age 40
Age 30
Administered by
Private insurers: Aviva, Great Eastern or NTUC Income.
Singapore government
Monthly disability benefit
300 or $400, dependent on plan chosen
Starting pay-out of $600 in 2020
Escalating monthly disability benefit
No
Yes. Monthly disability benefit will increase at a projected rate of 2% p.a. until the age of 67.2 However, should an individual make a claim before age 67, his/her monthly disability benefit will be fixed at the year of claim.
Duration of pay-outs
For up to 60 or 72 months, dependent on plan chosen
For life

Option to opt out?
Yes
No

One of the biggest difference between CareShield Life and ElderShield is the monthly disability benefit given in the event of a severe disability. While ElderShield only pays out for up to 60 or 72 months, CareShield Life will provide a monthly disability benefit for life. Pay-outs from CareShield Life is also higher with this starting at $600/month in 2020 and increasing over time.

^Monthly disability benefit is calculated on a projected 2% p.a. increase and is rounded down to the nearest decimal place.

However, unlike ElderShield which can be opted out of, CareShield Life is made compulsory for all Singaporeans born in 1980 or later. To aid in this transition, the premiums of CareShield Life will be subsidised for the first five years, between the years of 2020 to 2024.3

Lastly, a point to note is that while ElderShield used to be administered by private insurers, CareShield Life is now administered by the government.4

(See "Best Personal Accident Insurance Singapore 2020")


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Am I able to enhance my CareShield Life coverage?

CareShield Life can be enhanced with supplements purchased from private insurers. An example of a CareShield Life supplement is Care Secure from NTUC Income.

Care Secure by NTUC Income
The good
The bad
  • Option to get higher monthly disability benefits of up to $5,000.
  • Coverage commences with just two ADLs instead of CareShield Life’s requirement of three ADLs.
  • Receive a support benefit of up to 600% of your disability benefit.
  • Dependent benefit will be given for 36 months to your loved ones.
  • Death benefit.
  • Payable with MediSave, up to the $600 limit.
  • Monthly pay-outs from Care Secure are inclusive of what you will receive from CareShield Life.
  • No option for escalating pay-outs.
  • While CareShield Life would require an individual to be severely disabled and be unable to perform 3 out of 6 ADLs, coverage for Care Secure will commence with just the inability to perform 2 out of 6 ADLs. This allows the individual to get covered at an earlier stage of disability. Additionally, Care Secure also provides a support benefit and dependent benefit to allow you to receive additional pay-outs when you need it the most.

    Care Secure also offers higher monthly pay-outs with individuals able to choose to receive up to $5,000 monthly pay-outs. However, do note that pay-outs from Care Secure includes the pay-out receivable from CareShield Life. This means that if you choose to receive a monthly disability benefit of $1,800 from Care Secure, you would receive $600 from CareShield Life and $1,200 from NTUC Income's Care Secure.

    If you are concerned about an earlier stage of disability and wish to receive pay-outs from the first or second ADL, you may consider enhancing your coverage with other long-term care insurance plans.

    (See "What Happens If I Don’t Have Long-term Care Insurance?")


    Are CareShield Life supplements necessary?

    CareShield Life
    Care Secure (a CareShield Life supplement)
    Duration of pay-outs
    Lifetime cash pay-outs
    Lifetime cash pay-outs
    Condition for pay-outs to commence
    Severe disability, i.e. inability to perform 3 out of 6 ADLs
    Inability to perform 2 out of 6 ADLs
    Monthly pay-outs
    Starts at $600/month in 2020 and will increase annually until age 67 or when a claim is made, whichever is earlier
    Choice of monthly pay-out amounts, up to $5,000
    Additional benefits
    -
    Support benefit, dependant benefit, and death benefit

    While CareShield Life offers a lifetime of cash pay-outs in the event of a severe disability, the starting pay-outs are set at just $600 in 2020. However, a study has found that Singaporeans aged 65 and above who are living alone would need at least $1,379 a month for basic needs.5 This results in a monthly shortfall of $779 should a senior, aged above 65, unfortunately becomes severely disabled. As such, we feel that supplements for CareShield Life and/or other long-term care insurance plans would be good to have if your budget allows for it.

    (See "Should I switch from Eldershield to CareShield Life?")


    Our recommendation

    While CareShield Life supplements and/or other long-term care insurance plans will offer comprehensive coverage for long-term care, our take on this is that these supplements are a good to have but not a must have. This is because we feel that individuals should first consider their finances and determine their budget before purchasing any additional coverage. This will allows you to structure your insurance portfolio around what will best suit your coverage needs and ensures that you would not be overspending on insurance.

    Here are a few questions to consider before committing to a CareShield Life supplement:

    1. Will my MediSave have enough to pay for a CareShield Life supplement on top of what I am already using it for? (E.g. CareShield Life, MediShield Life and Integrated Shield Plan premiums)
    2. If my dependents are not able to pay for their own premiums with MediSave, will my MediSave have enough to pay for their premiums too?
    3. If my MediSave is insufficient to pay for these premiums, will I be comfortable to use cash to top-up the balance required?

    Consider getting a CareShield Life supplement and/or other long-term care plans if your answer to the above three questions is yes. However, if you feel that you would be stretching your finances by doing so then perhaps take time to reconsider and review your insurance portfolio.


    Click on the button below to speak to our experts if you would like to find out how you should structure your insurance portfolio or want to find out more about CareShield Life.


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    1Source: https://www.careshieldlife.gov.sg/careshield-life/premiums-and-premium-support/future-cohort--1980-or-later.html

    2Source: https://www.careshieldlife.gov.sg/careshield-life/benefits.html

    3Source: https://www.careshieldlife.gov.sg/careshield-life/premiums-and-premium-support/future-cohort--1980-or-later.html

    4Source: https://www.careshieldlife.gov.sg/faqs/careshield-life.html#:~:text=In%20addition%2C%20CareShield%20Life%20will,29.

    5Source: https://lkyspp.nus.edu.sg/gia/article/research-spotlight-series-how-much-does-a-singapore-household-need-for-a-basic-standard-of-living

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