Insurance co-payment may not solve issue of over-consumption

THE Singapore government's plan to mandate a minimum 5 per cent co-payment for new Integrated Shield Plan (IP) riders was a big talking point in the industry when it was announced in parliament last week.

Under revised guidelines that took effect on March 8, those who purchase new IP riders will no longer enjoy zero co-payment coverage. Insurers selling these riders must incorporate a co-payment of at least 5 per cent by the policyholder, with the quantum of co-payment capped at S$3,000.

While the new riders will be available from April 1 next year, insurance firms are allowed to sell their existing rider plans but will have to inform their customers that they must transit to the new scheme from April 1, 2021.