Navigating through CareShield Life Supplements

What is a CareShield Life Supplement Plan?

CareShield Life started on 1 October 2020 as a replacement of its predecessor, ElderShield 400, in a feat to tackle costs involving long term care. 

READ MORE: All About CareShield Life (The New Version of ElderShield) 

As the pay out from the basic CareShield Life predominantly covers the baseline and may likely not be enough to pay for the necessary expenses, we can add a CareShield Life Supplement plan to our portfolio to increase our monthly pay out by up to $5,000 per month. 

Premiums for the supplement plan can be paid using:

  • Your own MediSave account or your family members’ (spouse, parents, children, siblings, or grandchildren). You can deduct up to a maximum of $600 for every calendar year per insured, and the balance of the premiums would have to be paid in cash. The timing of signing up for the plan is important to ensure that you enjoy the lower premium if you are signing up closer to your birthday. As insurers have specific time frame of submitting to CPF Board for deduction, you may find yourself having two deduction attempts in the same calendar year, in which case you may not be able to utilise your MediSave on the second year if it is not properly planned out.
  • Cash only. You can opt to utilise only cash if this is something you prefer.

CareShield Life supplements are offered by three private insurers that provide pay out that complement the CareShield Life, namely NTUC Income, Great Eastern Life and Aviva. To add on a supplement plan, you must be either a CareShield Life or an ElderShield policyholder. If you have opted out of ElderShield previously, you can do either of the following: 

  1. Sign back up for ElderShield from now until the conversion exercise takes place at the end of 2021, subject to your current medical condition. Once this is done, you can purchase the supplement plans. Once the conversion exercise starts, your ElderShield 400 will be converted to CareShield Life. 
  2. Or wait till end of 2021 to sign up directly to CareShield Life. However, you may end up paying more if the conversion takes place after your birthday. 

These supplement plans provide additional features such as higher monthly payouts, reduced criteria for making claims, and extra perks such as waiver of premium in the event of major disability, dependent benefit, and caretaker benefit.

Outline of CareShield Life Supplement Plans

There are currently three private insurers that offer the CareShield Life supplements, and they are NTUC Income, Great Eastern Life and Aviva. The setup of the plans are predominantly different between NTUC Income and, Great Eastern Life and Aviva. The diagram below illustrate this point.

CareShield Life Supplement Plan Diagram

The pay out for NTUC Income’s Care Secure plan includes pay out from CareShield Life, whereas Great Eastern Life’s Great CareShield and Aviva MyLongTermCare and MyLongTermCarePlus plans pays on top of CareShield Life. Not one is better than the other, rather it depends on your needs and the type of cover that you are looking at.

If you are an existing ElderShield policyholder, you can refer to What are CareShield Life Supplements for more information.

NTUC Income Care Secure

As mentioned above, the pay out of this plan include those from the CareShield Life. This plan pays out from moderate disability onwards. This is defined as the inability to perform 2 out of 6 ADL, and pays out a monthly benefit of between $1,200 to $5,000.

Highlights of the plan include: 

  • Initial lump sum pay out of a support benefit of 300% or 600% of the monthly benefits depending on the severity
  • Dependants benefit of 25% extra per month for up to 36 months 
  • Lump sum pay out of a death benefit of 300% of the last drawn monthly benefit

The interesting thing here is the dependants benefit whereby it is defined as any of the following:

  • your child (or children) below 21 years old
  • your husband or wife
  • your parents (biological parents, step-parents, or parents who legally adopted you)
  • your parents-in-law

This is the only plan on this list that does not allow existing ElderShield 300/400 policyholders to enrol simply because the payout include the base cover, and ElderShield 300/400 is structurally different from CareShield Life.

Great Eastern Life Great CareShield

Great Eastern Life has two plans in place; GREAT CareShield Enhanced and GREAT CareShield Advantage. The differences between the two plans are as follow: 

  • Unfit to do 2 of 6 ADL, Enhanced pays 50% of the monthly pay out whereas the Advantage plan pays 100%
  • Advantage pays out an initial lump sum of 300% of the monthly benefit if you are unfit to do 1 out of 6 ADL

Your premiums will waived if you are unable to perform at least 1 ADL regardless of which plan you are subscribed to.

This plan is applicable for CareShield Life or ElderShield policyholders as the pay out is on top of what these schemes pay. 

Right now, Great Eastern Life is providing a first year discount if your annual premium exceeds $750 per annum.

Aviva MyLongTermCare / MyLongTermCarePlus

The last on the list is Aviva’s MyLongTermCare and MyLongTermCare Plus. You can choose to purchase additional coverage of any amount in incremental of $100 from $200 to $5,000 per month, that is payable on top of CareShield Life pay out. There are 3 different types of plan under each category:

  • Level pay out and premium throughout the term
  • Increasing pay out and premium at 2% per annum
  • Increasing pay out and premium at 3% per annum

The differences between MyLongTermCare and MyLongTermCarePlus are:

  • MyLongTermCarePlus pays out from the time where the insured is unfit to do 2 ADL onwards
  • MyLongTermCare has a similar criteria as CareShield Life and only pays out if insured is first unfit to do 3 or more ADL. However if the condition improved from 3 ADL to 2 ADL, the pay out will be 50% every month instead.

Highlights of both plans include: 

  • Initial lump sum pay out of a support benefit of 300% of the monthly benefits
  • Dependants benefit of 20% extra per month for up to 36 months in your lifetime where child or children are below 21 years old
  • Caregiver relief of 60% extra per month for the first 12 months
  • Lump sum pay out of a death benefit of 300% of the last drawn monthly benefit

Right now, Aviva provides a perpetual 20% off for premium of at least $500 per annum for both plans.

Which CareShield Life Supplement should you go for?

Confusion about CareShield Life Supplement Plans

Creator: Pexels | Source: Pixabay

There are a few factors that determine which CareShield Life supplement plan suits you more. These include the ability to cover for a less stringent criteria (ie 2 ADL), or which fringe benefits are more important to you. Another consideration is that you may have existing plans that cover for this. Certain retirement plans provide complimentary cover for ADL as well. There are definitely many ways to look into this. 

If you are looking at plans with increasing pay out such as the one by Aviva, you will need to consider the fact that the premiums increase every year and that in your later years, the premiums may be high. If this is something that matters to you, you may wish to go for the level premium option. 

Long term care is a real threat to our finances, especially when you are at the retirement age where you could no longer work in the future. In addition, there have been more cases of claims happening earlier – in 50s or 60s. The government did a fine job revamping the older plan, with allowance for you to increase your coverage. Ultimately, it is your responsibility to safeguard your personal retirement funds, and not burden your loved ones as a consequence of a severe disability. 

Disclaimer: Information written is to my best knowledge as per the date posted and has no legal rights. It represents my personal opinion, which may be different from yours, and that’s totally cool. It is important to read the policy contract and documents for the full terms and conditions. This post does not constitute a recommendation. Please seek professional advice before committing to a plan as it is a long term commitment.

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Adrian Chen

Adrian chanced upon into this industry by chance; as a caregiver of someone who suffered from critical illness. The incident gave him a whole new perspective into financial planning. As an independent financial advisory representative, he looks to give his very best for his friends and clients.

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