Private shield and employer benefits

In an article in the Sunday Times, the editor recommended that the consumer should buy a Private Shield now, even if the consumer is provided with medical benefits by the employer. I find this to be a wasteful practice.

If the private shield cost $300 a year, the total premium, including interest at 4% per annum payable on the Medisave account, will amount to $22,000 at the end of 35 years. This is a lot of money to give away to a cover that is not really needed.

Although the Minister for Health did make a claim of $20,000 on his Private Shield policy, this is not a common case. For each person who makes a claim, there must be 10 other people who did not make the claim. The Minister is not covered for medical benefits by the employer, so a private shield is necessary.

This is not the case for many people in the private sector who are provided with medical benefits by the employer. Do not waste your money.

The consumer is told by the insurer or the agent that if they buy the private shield at a young age, they are guaranteed with the cover when they grow old. This is only partly true. The cost of private shield above age 65 is so costly (maybe $2,000 or more a year) that many retirees cannot afford it. They are likely to downgrade to Medisheld at that time. So, the consumer will be wasting $22,000, but it will be a lot of commission and profits for the agent and the insurer.

Read my articles in www.tankinlian.com/ask.aspx. Search for "Shield". Remember - even if you pay the premium, you will not find it easy to make a claim under some situations.

Tan Kin Lian