Private insurance plans

NOTICE PAPER NO. 2337
NOTICE OF QUESTION FOR WRITTEN ANSWER
FOR THE SITTING OF PARLIAMENT ON OR AFTER 7 NOVEMBER 2023

Name and Constituency of Member of Parliament
Ms Hazel Poa
Non-Constituency MP

Question No. 5126

To ask the Minister for Health (a) whether the Ministry has studied how private insurance plans, such as Integrated Shield Plans, can remain sustainable without having to reject new applications based on pre-existing conditions; and (b) whether there are any plans to explicitly forbid private insurance companies from rejecting new applications for insurance plans based on pre-existing conditions and, if not, why not.

Answer

1     For insurance plans to remain sustainable without rejecting individuals with pre-existing conditions, a large risk pool comprising both healthy and unhealthy individuals is necessary. This is why MediShield Life (MSHL), our national health insurance scheme, was designed to cover all Singapore Residents from birth, regardless of pre-existing conditions.

2     Integrated Shield Plans (IPs) and other private health insurance plans offer optional coverage on top of MSHL. As these are private products, underwriting decisions are subject to insurers’ commercial and actuarial considerations.

3     If insurers cannot reject applicants with pre-existing conditions, they may have to increase premiums for all policyholders to ensure that their insurance risk pool remains sustainable.

4     Depending on their underwriting practices, insurers may still offer coverage to applicants with pre-existing conditions, but with exclusions or risk loading (i.e., higher premiums). This allows such applicants to benefit from some coverage without adversely affecting other policyholders.