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The Singapore government has spoken out against claims that it was gaining profits from the ElderShield and CareShield Life health insurance schemes.
A post on the government’s website said that it will not profit from CareShield Life, and that premiums and investment returns will remain within the fund and be used to introduce more benefits in the future for policyholders.
This was in response to messages circulating on social media and messaging platforms that these schemes were introduced to make money at Singaporeans’ expense, The New Paper reported. The messages also said that, because of the low chance of severe disability, policyholders are unlikely to benefit from the scheme.
“Today, premiums collected under ElderShield are more than the claims paid out, as most policyholders are relatively young,” the post said. “However, these premiums collected do not become government surpluses. Rather, they are meant for future claims – when policyholders become older and more of them make claims for severe disabilities.”
It revealed that from 2013-2017, annual claims paid out increased by 12%, compared to only 3% of annual premiums collected.
The government also argued that as Singapore’s population continues to age, around half of those healthy at age 65 could end up severely disabled. This, coupled with shrinking family sizes, will make it difficult for elders to rely on personal savings and their children’s incomes to meet their long-term care needs, it said.
