Insurers pledge not to raise top-up portion of Integrated Shield premiums

SINGAPORE — The five insurers offering Integrated Shield plans yesterday pledged not to increase the top-up portion of premiums for plans that cover B1 and A Class wards in public hospitals for a year after MediShield Life kicks in at the end of next year.

This means any increase in premiums for such Integrated Shield plans during this one-year period will be due to MediShield Life.

Dr Khoo Kah Siang, president of the Life Insurance Association, Singapore, said this would allow for a smooth transition of renewals of Integrated Shield plans, after which insurers will reassess the plans based on actual experience and claims.

The commitment from the insurers — which Dr Khoo said was based on the “assumption that there is no significant change to the regulatory and competitive environment” — excludes Integrated Shield plans covering private hospitals. He said current Class B1 plans, including the top-up premiums, were subject to review, in consultation with the Ministry of Health (MOH) and other authorities as part of deliberations to develop key features for a standardised Integrated Shield plan focused on Class B1 coverage.

The insurers’ announcement yesterday came as Health Minister Gan Kim Yong said, during the parliamentary debate on the report by the MediShield Life Review Committee, that the Government would study the committee’s suggestion to strengthen the regulatory and accountability framework for these insurers.

Six in 10 Singaporeans have Integrated Shield plans, and some have noted that consumers tend to purchase the plans when they are young and working, but could face problems in affording steeper premiums when they are older. Tanjong Pagar GRC Member of Parliament (MP) Lily Neo said this could mean that many pay for private insurance when young and healthy, making few claims, but switch to MediShield Life when they are older and likely to claim more due to illnesses. Private insurers could avoid older age groups and divert them to MediShield Life by raising premiums, and Dr Neo questioned how the MOH planned to “minimise this occurrence”.

Potong Pasir MP Sitoh Yih Pin suggested that the standard B1 plan could be offered by a single insurer for better risk-pooling. The Government could administer the B1 plan, leaving private insurers to concentrate on products for A Class and private hospital wards, he said.

Mr Gan said the MPs’ suggestions would be considered when designing the B1 plan.