Government to run ElderShield insurance scheme from 2021
Move to allow smoother upgrading process for policyholders to CareShield Life
From 2021, the Government will take over the administration of ElderShield, the optional severe disability insurance scheme, which is currently being run by three private insurers.
The Ministry of Health (MOH) said in a statement yesterday that it had reached an agreement with the insurers - Aviva, NTUC Income and Great Eastern. The three insurers will transfer the liabilities, and corresponding assets backing these liabilities, for all ElderShield policies to the Government.
This is valued at around $2.9 billion.
There are currently 1.3 million ElderShield policyholders.
The move is meant to coincide with the period when people born in 1979 or earlier are able to join the new CareShield Life scheme, and the Government's takeover of ElderShield will allow for a smoother upgrading process for ElderShield policyholders that make the switch, the ministry said.
CareShield Life, a compulsory government-run scheme, will be implemented from 2020 for everyone between the ages of 30 and 40 and is intended to replace the optional ElderShield.
Subsequent future cohorts will join the compulsory scheme when they turn 30.
Those over 40 years old in 2020 can stick with ElderShield or upgrade in 2021 by topping up their premiums.
Those that do not make the switch will remain covered by their existing ElderShield policies and will benefit from the improvements to the claims assessment process that will be implemented for CareShield Life.
For example, cognitive impairments will be taken into account in a new assessment framework.
When it takes over, the Government will run the scheme on a not-for-profit basis and there will continue to be premium rebates, MOH said.
The ElderShield Review Committee, which had recommended a compulsory, government-run national disability scheme, welcomed the announcement.
Chairman Chaly Mah said in a statement that having all ElderShield and CareShield Life policyholders serviced by the same administrator will ensure consistency, something that the committee had noted in its report, submitted to Health Minister Gan Kim Yong last May.
MOH said yesterday that at this point, existing ElderShield policyholders do not need to take any action.
Holders of ElderShield Supplements will not be affected and will continue to be served by their existing insurers.
The three current ElderShield insurers will also continue to issue new policies and serve existing ones until the transfer is completed.
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