Commentary

If you’re looking to review whether your health insurance coverage is sufficient or too much, here are three questions to ask yourself, says financial adviser Grace Tay.

Those who buy new Integrated Shield Plan (IP) riders from April 2026 will bear more out-of-pocket costs when making claims. (Photo: iStock/Ziga Plahutar)

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22 Jan 2026 06:00AM

SINGAPORE: A major change in health insurance plans is coming up in April 2026. Those who buy new Integrated Shield Plan (IP) riders will bear more out-of-pocket costs when making claims, as the deductible will no longer be covered and the annual co-payment cap will be raised.

Those who already have existing riders won’t be directly affected by the changes. But given about 100,000 people cancel or downgrade riders every year due to rising premiums, this may be a good opportunity for all to review assumptions of our anticipated healthcare needs and future ability to afford private care.

The cost pressures on Singapore’s healthcare system have been building up over recent years, driven by a combination of rising land costs, an ageing population, and the growing number and size of claims on insurance plans. The upcoming IP rider changes reflect a growing emphasis on shared responsibility and cost-conscious healthcare.

In June 2025, insurer Great Eastern caught policyholders by surprise when it suspended preauthorisation claims (approval of coverage before treatment) for Mount Elizabeth hospitals, based on observations of consistently higher charges for similar treatments. Insurers have also been shifting away from “comprehensive for life” coverage, and quietly adjusting benefits, even for older policies.

HOW IP RIDER CHANGES AFFECT YOU

The changes don’t reduce the conditions or benefits the IP riders cover; they shift how the costs are shared.

Patients will face more out-of-pocket payments if they require hospital care: They will have to pay the minimum deductible – which ranges from S$1,500 to S$3,500 depending on ward class – before insurance kicks in, and co-pay at least 5 per cent of the remaining bill up to a higher S$6,000 minimum cap in the same policy year, even if across different bills.

While co-payment can be covered by MediSave, this is subject to withdrawal limits. If these limits are exceeded, especially for costlier treatments, patients will have to top up with cash.

But annual premiums for the new riders are expected to drop by about 30 per cent, compared to those offering maximum coverage. Premium savings can add up, when current riders can go for an average of about S$3,400 per year for a 40-year-old and S$9,500 per year for a 60-year-old. While premium inflation will still occur over time, it now starts off from a lower price point.

Consumers will need to ensure they have enough to defray premium inflation over the years, and also enough cash or MediSave to cover deductibles and co-payments in a claim year.

FINANCIAL ADVISORY INDUSTRY’S ROLE IN LOWERING COSTS

But patients can ultimately only choose from insurance products the financial advisory industry puts on the market.

Mr Ong has described the current situation as a “knot” that private health insurers and private hospitals are “tied up in… to the detriment of all stakeholders, including patients”, that came about largely due to generous products designed to win market share.

To tackle this “knot”, Singapore’s financial advisory industry needs to shift from a product-led culture to a needs-led culture. Instead of promoting overly complex or excessive coverage, advisers should take a more strategic approach to long-term protection.

There must also be greater transparency in financial advisory. Consumers should be equipped to ask: “Is my adviser recommending this because it’s best for me, or because they are limited by product range?”

Understanding the breadth of solutions an adviser is equipped to offer, and seeking out a second opinion allows consumers to make informed choices about financial planning.

STRESS-TEST INSURANCE COVERAGE

If you’re looking to ensure coverage is sufficient for you and your family, here are three things to do.

First, evaluate if your plans fit with your life stage and goals. Your needs will have changed if your policy was passed down from your parents, or if there are major changes in family planning and career priorities.

Second, review your liquidity in light of the shift towards co-payment. Assess your tolerance for paying out-of-pocket, and whether your family will have sufficient resources to tide through a period of unemployment or no-pay leave, if needed for recovery. Even when you are healthy and don’t have hospital bills, premiums will still go up in the long run. Buffer enough resources, lest you lose your coverage when you most need it.

Third, think of insurance as part of a financial strategy. Most people accumulate insurance, investment and savings products over time without a coordinated financial strategy. Overlapping products can add unnecessary costs or lock up funds that could go towards saving for retirement or paying for healthcare.

Beyond costs, treatment preferences remain a key consideration regardless of policy structure. Whether it’s access to a specific hospital, doctor, or alternative treatment options like TCM, more out-of-pocket exposure means preferences will have financial implications.

Don’t overlook hidden costs like transport and caregiving. Major illnesses or accidents could require significant post-hospital care that may not be covered by insurance: Care in a nursing home, for instance, can cost S$3,000 to S$5,000 per month and persist for years.

THREE QUESTIONS TO ASK YOURSELF AND YOUR FINANCIAL ADVISER

If these steps still seem daunting, you can start by asking yourself these questions:

• When was your last policy review? If it was more than five years ago, it might be time to revisit.
• What are your non-negotiables if you contract a serious illness or disability? Do plans reflect your current health, life stage and treatment preferences?
• Have you budgeted for cash or MediSave to cover potential out-of-pocket costs?

Next, ask your financial adviser these other questions:

• What are the plausible scenarios to stress-test your coverage and the daily financial realities in each case?
• What are all the plan options available to you, and what are their differences in terms of premiums and coverage?
• If you are speaking to a tied agent who sells and advises on products from only one insurer, how do these options compare against other brands in the market?
• How often have premiums been adjusted over the past years and what rate of projection should I be using to estimate premium increases moving forward?

Ultimately, the right coverage gives you the confidence to navigate life, not just illness, with peace of mind.

Grace Tay is an associate director with finexis advisory, which is not affiliated with any insurer.

Source: CNA/ch