Most Singaporeans are unprepared and underinsured for long-term care: Singlife
While long-term care costs close to S$3,000 a month on average, the insurance provider finds that more than half of those surveyed underestimate the amount
[SINGAPORE] Only one in three Singaporeans have taken out additional insurance to cover the cost of long-term care, and more than half of them underestimate actual expenses, revealed a white paper by financial services provider Singlife.
“This is alarming, especially when the numbers have shown that more than half of those over 65 will likely need some form of long-term care in their lifetime,” said Pearlyn Phau, group chief executive of Singlife, at the launch of the white paper on Friday (Jul 25).
Singlife is one of three private long-term care insurance providers in the Republic. Long-term care refers to services typically required by individuals who need further care after being discharged from an acute hospital, as well as the help that the elderly may need with daily needs.
Phau noted that as the life expectancy of Singaporeans rises, a longer lifespan can bring new and complex challenges – not just financial, but also emotional ones, for individuals, families and society at large.
This inspired Singlife to delve deeper into the realities of long-term care and publish the paper, titled From awareness to action: securing long-term care for a super-aged society, which presents findings drawn from its long-term care insurance claims data from 2010 to 2024.
The paper incorporates insights from two in-house research studies which surveyed 1,005 Singaporeans and permanent residents (PRs) aged 18 to 65 on perceptions for long-term care, as well as 1,075 Singaporeans and PRs – including 249 caregivers – to better understand experiences and challenges in dementia caregiving.
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“This white paper is a call to action for individuals, families and institutions to plan proactively, because the long-term care challenge is already at our doorstep,” added Phau.
Long-term care coverage is strategic to Singlife and a crucial component of its product suite, said Helen Shen, group head of products, in an interview with The Business Times on the sidelines of the event.
Phau said such coverage would protect one from youth all the way to retirement, so Singlife’s suite of such products are “highly critical” for the insurer.
Significant gaps
Singlife’s research revealed a significant gap in both awareness and financial preparedness among Singaporeans regarding long-term care.
While long-term care costs close to S$3,000 a month on average, Singlife found that more than half of those surveyed underestimated the amount.
Since a similar study in 2018, costs have increased by S$628, reflecting an annual inflation rate of around 4 per cent. Given the prolonged nature of care and compounding inflation, these costs are likely to go up further.
However, Singapore’s national insurance schemes, ElderShield and CareShield Life, offer coverage of only up to S$662 a month. This leaves a significant shortfall that could be bridged by private long-term care supplementary insurance plans.
Yet, two-thirds of Singaporeans aged 30 and up have not taken up such coverage and may have to rely on personal savings or family support, potentially placing additional strain on their retirement funds.
This lack of preparedness is especially concerning, given the typical duration of care. Singlife’s claims data from 2010 to 2024 showed that individuals required long-term care for an average of 10 years; Singlife’s longest active claimant has been receiving monthly payouts for more than 15 years.
Long-term care is not limited to seniors either, given the youngest claimant was just 32 when making the claim.
Being prepared
In light of these findings, the white paper puts forward a series of recommendations, including a renewed focus on early detection, intervention and prevention of conditions such as strokes, which remain a leading cause of the need for long-term care.
At the launch event, Singlife also hosted a panel discussion on preparing for the rising demand for long-term care individually and collectively.
“You have to be prepared financially, and not think government grants will be enough, as healthcare costs are coming up quickly,” said panellist Jason Foo, chief executive at Dementia Singapore.
This is where insurance plays a key role in protecting oneself financially, he added.
The sum assured for Singlife’s long-term care products are as low as S$200, and premiums can be drawn from one’s Central Provident Fund, noted fellow panellist Shen.
She also highlighted that while many believe themselves to be too young to sign up for such coverage, it is more financially sustainable to get insured as early as possible.
“You are not just protecting yourself, you are also protecting your loved ones who will have to look after you,” added Shen.
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