MediShield Life review: Allow insurers to cover pre-existing conditions

SINGAPORE - When MediShield Life kicks in next year, those with pre-existing conditions not currently covered under MediShield should have to pay an extra 30 per cent in premiums for 10 years.

This is to compensate for their higher risks. From the 11th year, they will pay the same premiums as other policyholders in the same age band, said the MediShield Life review committee on Friday.

The committee also urged the Government to let private insurers manage those with pre-existing conditions differently from their healthy counterparts. This includes allowing for risk-loading - that is, charging such people higher premiums, but also insuring their pre-existing conditions.

Doing so would cost more, but would also give people the assurance that their conditions are covered.

Currently, private insurers are allowed to exclude pre-existing conditions in a policy or deny applicants coverage. However, they are not allowed to offer risk-loaded policies.

To help applicants make informed choices, the committee suggested that insurers be required to inform potential policyholders how estimates of their risk-loaded premiums compare to standard policies that are not risk-loaded. However, the committee also noted that it would not be desirable to make it compulsory for private companies to cover pre-existing conditions in the interest of long-term financial sustainability.

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