What are the considerations when buying a private medisave-approved integrated shield plan?

When applying for a medisave-approved integrated shield plan, you should consider whether the product:

1. Covers congenital conditions and if so under what terms and conditions; and
2. Whether it covers pre-existing conditions and if so under what terms and conditions.

If you already have an existing pre-existing conditions and you have never been considered as under a sub-standard case in any other insurance application, your only chance at this moment is to apply for Aviva’s Myshield under Moratorium Underwriting. If you apply for other insurance and is declined or postponed, you are automatically not eligible to apply for Aviva’s Moratorium Underwriting.

If you do not have any known condition, you can “shop” around but do remember that any pre-existing condition (even if it is unknown) is usually excluded for medisave-approved interegrated shield plan. Some considerations for selecting a medisave-approved intergrated shield plan are:

1. The size of the existing policy base. The larger the policy size the greater the economy of scale and longer term viability;
2. The reputation of the insurer – whether do they have a reputation of emphasizing on maximizing shareholders’ value at the expense of policyholders. You should not ask any financial advisers on the reputation of the insurers due to the conflict of interest. However, you can do your own research on the Internet etc. You will find a handful of insurers which are well known to have very bad reputation.
3. The size of the premium especially when you get older. You do not want to lose your insurance cover just because you cannot pay it when you are old as your greatest need occurs when you are old.

If you already have an existing medisave-approved integrated shield plan, it is best not to replace it unless the replacement product offers benefits that are highly compelling. Do note that if you are already insured with a “as-charge” shield plan, any shield plan you want to buy could only offer you marginal benefit. The risk of policy replacement is the exclusion of pre-existing illness (even those you do not know). The marginal benefit is usually too little to offset the greater risk of the exclusion.

Finally, commission payable under a medisave-approved integrated shield plan is so small that many financial advisers are not too keen focus on it although the shield plan is the most important insurance. You should always remember this.

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