Buy medical cover while still working

26 May 2007, The Straits Times

Question

Name of the Person: Paul Chan Poh Hoi

Insurance cover: Why the bias against retirees?

I AM thankful to the Ministry of Health (MOH) for the response, 'More insurance cover? Buy enhanced Medi- Shield' (ST, May 12), to my letter, 'Allow claims for pre- and post-ops claims' (ST, May 5). Perhaps MOH could enlighten me whether it would have been better for me to buy enhanced MediShield during my working years before retirement at 68.

When my company's comprehensive hospitalisation and surgery (H&S) insurance policy covered my spouse and me adequately, should I have bought more policies? Would enhanced MediShield or additional coverage have got me more payments in claims?  The answer is apparently 'no'. Despite my surgical operations, I continued to enjoy coverage under the company's H&S policy with exclusion clauses. When I was about 64, I was rejected by MediShield Plus.

Now I am 70 and not covered by any company - all the goodwill of my insurance cover from those years has gone down the drain. No insurance provider accepts me under any privatised 'Shield' protection plan.  I am sure there are many like me. Perhaps MOH can explain why insurance companies refuse insurance cover and discriminate against the elderly once they retire.

First, why are these loyal customers turned down when they reach old age? Didn't they contribute faithfully via their company and thus shouldn't they be considered policyholders from a young age with a complete medical history? Don't they deserve continued insurance protection under their individual name?

Second, do middle management staff under adequate H&S insurance cover by their employer need to put in extra money to buy enhanced MediShield or other insurance until they reach retirement age? If so, where is the need and who benefits most - the insurance companies or the individual?

Third, what is the rationale for not counting premiums paid during employment until retirement?  Insurance protection is bought on a needs basis.  Policyholders insured under their company or individually should follow their own name within the pool of funds from various insurance providers over the years. In this way, insurance cover can be made portable and ensure policyholders do not lose out in case of job change or retirement.

Is there any valid reason to treat them as new cases when they apply for coverage with the same insurance company when they retire?  It is not a simple case of 'More insurance cover? Buy enhanced MediShield'. Rather, it is a dilemma for those covered adequately when young on the basis of needs yet denied insurance cover when they need it most when old.

Reply

Reply from MOH 

Buy medical cover while still working

In “Insurance cover: Why the bias against retirees?” (ST, 17 May), Mr Paul Chan asked why insurance companies do not provide  medical insurance cover for the elderly once they retire.

The Medisave-approved private medical insurance (PMI) plans accept new applicants who are elderly. They also guarantee renewability. However, they may not offer insurance to new applicants if they suffer from pre-existing diseases so as to prevent anti-selection. Hence, if a retiree does not have pre-existing illnesses at the point of application, he would have been able to purchase insurance upon retirement.

However, as Mr Chan rightly pointed out, many working Singaporeans would not plan for long-term coverage when they enjoy employer health benefits. As a result,  when they lose their benefits upon retirement , they may  find it difficult to purchase health insurance , especially if they have pre-existing illnesses.

We therefore urge Singaporeans to  consider whether they will need additional insurance cover after retirement and  buy it early, even while still working.  Employers should also  consider purchasing insurance that will benefit their employees both in the short and longer term.  For example, employers could provide insurance that can then be renewed (and paid) by their employees after they retire.