Friday, August 03, 2007

Level premium for Shield plan

Dear Mr Tan,

I understand that the premium for the Shield plan varies according to the current age. It means that I have to pay a higher premium when I grow older. The increase can be quite steep. Is it possible for me to pay a level premium?

REPLY:

It is true you have to pay a higher premium when you grow older. To get an idea about the likely amount, you can refer to section 15 of this FAQ.

It is not possible for the insurance company to charge a level premium, as the premium rate has to be revised according to the claim experience. It is likely that the cost of treatment will increase in the future, due to new technology and more sophisticated method of treatment.

The premium will increase due to two factors - increase in your age (as older people need more treatment) and escalation of treatment cost.

Although you pay an increasing premium, you can use your CPF Medisave account to level out the cost. You should keep sufficient money in this account to pay for all of your future cost. It allows you to earn interest on the balance in your account.

You also have the choice to downgrade to a less costly plan, when you grow older. This option is available only if you have a plan with a yearly adjustible premium.
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2 comments:

Anonymous said...

By the way, I just want to enquire why do I need to inform NTUC Income in the event that I need to be hospitalised for treatment?

Will NTUC Income be recommending the "cheapest" treatment available? What are the consequences in the event I forget to inform NTUC Income of my upcoming treatment? Will I still be able to make a claim under EnhancedIncomeshield?

August 06, 2007 12:26 AM
Khiat Han Hwee Adrian said...

I advise you to talk to your NTUC Income advisor for the answer.

If I remembered correctly, NTUC Income have more than 500,000 policyholders under Incomeshield. The 4 days prior notice for non emergency hospitalisation was implemented since May06 for their Enhanced Incomeshield. I understand their reasons to do it and its too long for me to answer here.

They should be handling hundreds of claims daily. Btw, have you heard any complains that NTUC do not pay claims due to not giving the prior hospitalisation notices? I've worked in the industry for years, I have not heard of it yet.

August 07, 2007 12:09 AM

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