The Chairman of the ElderShield Review Committee Chaly Mah told media reporters that the new mandatory insurance scheme will get more expensive because “there is no free lunch”:
“There is no free lunch, the increase in payouts have to be balanced by an increase in premiums.”
The Lee Hsien Loong crony who also sits in the Board of Director in the Monetary Authority of Singapore, yesterday (May 27) announced the launch of CareShield Life with Health Minister Gan Kim Yong.
The premiums of CareShield Life is 81% more expensive when compared to ElderShield. A 40 year old man will pay S$275 a year in premiums under CareShield Life, as compared to S$151.67 a year under ElderShield.
CareShield Life’s former form, the ElderShield, was found to be hugely profitable. In 2017, it had only disbursed S$133 million out of S$3.3 billion in total premiums collected. The Singapore government is expected to profit more from the new CareShield Life, by making the disability insurance plan mandatory for all Singaporeans.
Government subsidies is only available for the first 5 years, and all Singaporeans will have to pay the full amount after that. Premiums will also increase 2% a year, disregarding the rate of inflation. If a disabled meet the stringent disability requirements, the monthly S$600 payout will also said to “increase” but no details were given how much it would increase.