Healthcare: Importance of health insurance

The rising cost of healthcare is a major concern in Singapore.

Aside from an increase in government spending on healthcare, insurers have also been increasing their premiums for private integrated shield plans due to the rising cost of hospitalisation treatments. Below are the top 5 causes of hospitalisation in Singapore and their respective costs.

Accidents can result in many kinds of injuries and thus, it is rather difficult to average out the cost of hospitalisation and treatment. In the table below, we have listed down the current average cost of hospitalisation for the rest of the 4 conditions of hospitalisation. Data is from the Ministry of Health.

Despite cancer being one of the most common ailments among Singaporeans, information on the average cost of treatment is not easily available online.

Importance of insurance

Healthcare in Singapore is no doubt expensive however, the government provides heavy subsidies of up to 80% of the total bill in public hospital wards. It is important to keep in mind that the subsidies are also based on income brackets and the ward type (A, B1, B2 or C). These subsidies are not enough to keep your funds safe as they do not provide you with full medical coverage.   

Purchasing healthcare insurance is one of the most important things you ought to do for yourself as well as your family members. It is better to plan ahead and prepare yourself for unexpected situations. Save yourself the hassle of scrambling to find solutions to cover the medical costs. We spoke to Jason Tan, a Financial Services Manager from an Independent Financial Advisory Firm about three important things that one should note before buying health insurance.

Awareness

Being aware of your current health conditions – whether you have any pre-existing illness or on any long-term treatment or medication – is important when buying a health insurance.  Pre-existing condition refers to any illness or injury that you have prior to purchasing an insurance plan. Often, you’ll see pre-existing conditions listed as a common exclusion in plans. Do keep that in mind when purchasing your insurance plans.

Information

Due to insurance being a competitive market, insurers create their unique selling point (USP) by having different benefits to their policies. Some insurers cover longer pre- and post-hospitalisation periods while some offer free coverage for children under 21 years of age provided both parents are insured. Be well-informed of the coverages provided by your insurer. Ask questions about the coverage before deciding to purchase a policy.

Comparison

After you have completely comprehended the scope of the policy, compare the benefits offered with your current situation. The benefits should be relevant to you. Check the list of network hospitals and see if it includes the facilities that you often visit.

It is best to consult license independent financial adviser representatives and generally, it is better to apply for the riders and deductibles to ensure you’re covered from the first dollar. It makes every sense to pay a small amount or a premium to cover the potential claim and risk. – Jason Tan, Financial Services Manager, Independent Financial Advisory Firm

 

Visit sgfinancialplanner.com or their Facebook page to read more on personal finance from Jason Tan.

 

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