Integrated Shield plan riders look set to continue

LIA says working committee to work with insurers to tackle escalating claims costs

People waiting for their turns at a waiting room at Tampines Polyclinic.
People waiting for their turns at a waiting room at Tampines Polyclinic. PHOTO: ST FILE

Consumers who have bought Integrated Shield plan (IP) riders that enable them to get away with paying nothing towards their own medical treatment will continue to enjoy the advantage.

Yesterday, the Life Insurance Association (LIA) said insurers cannot collaborate with one another to pull out such riders.

This was in response to market observers who have suggested that removing such riders would be one way to offset rising claims. Patients with riders generally have bills that are 20-25 per cent higher than those who have to bear a share of the cost.

"Consumers want choices and options, and some prefer to have their coverage fully taken care of," said Dr Khoo Kah Siang, LIA's president, yesterday at the quarterly results briefing. He added that the association will work with stakeholders to tackle the issue of rising claims rates of IPs.

Last month, the Health Insurance Task Force (HITF) issued recommendations aimed at reining in the escalating claims costs.

LIA yesterday said that a working committee has been set up to review them. Its objective is to provide guidelines for individual insurers to adapt and consider for their own implementation plans.

The insurance-specific HITF recommendations include a pre-authorisation framework, having a panel of preferred doctors, and product design to include deductible and/or co-insurance components. LIA expects to report on its review in six months.

Health insurance continues to be a top priority for Singaporeans. From July to end-September, about 10,000 more Singapore residents obtained additional health insurance coverage, mostly through IPs and/or IP riders.

In all, new health insurance premiums totalled $172 million for the nine months ended Sept 30, of which IP premiums and IP riders accounted for 85 per cent ($146 million). The remaining $26 million was contributed by other medical plans and riders.

As at Sept 30, about one in two individuals in Singapore (2.87 million lives) are covered by health insurance with total premiums amounting to $1.37 billion.

For the first time, LIA shared data on the uptake of products that provide regular payouts from retirement age. This is in the light of Singapore's ageing population and the increasing importance of retirement planning.

The new data shows that such plans accounted for about 5 per cent of the total weighted premiums for the three quarters ended Sept 30. A total of 14,519 policies were sold, with about $116 million of weighted new premiums recorded.

"LIA Singapore is including the additional data to highlight the importance of planning adequately for retirement in a nation with one of the fastest ageing populations in the world," said Dr Khoo.

The LIA posted flat growth in weighted new business premiums, which declined 1 per cent to $808.2 million in the quarter ended Sept 30. Weighted single premium product sales declined 14 per cent to $232.8 million while annual premium products rose 6 per cent to $575.4 million. The picture is rosier for the nine months ended Sept 30. Total weighted new business premiums grew 8 per cent to $2.33 billion, compared to the same period last year. Weighted single premium products grew 11 per cent to $730.8 million while annual premium products recorded $1.6 billion in new sales, up 6 per cent.

A version of this article appeared in the print edition of The Straits Times on November 09, 2016, with the headline 'IP riders look set to continue'. Subscribe