Get ready for pricier private hospital Shield plans and riders

IF you are Singaporean or a resident with a CPF account, you will surely have hospitalisation insurance in the form of MediShield Life, and most likely also a private Integrated Shield plan (IP). It is estimated that nearly 4 million people are in the MediShield scheme as at 2016, and two-thirds have an Integrated Shield plan.

Yet even with the sizeable numbers, navigating the IP landscape isn't as straightforward as it should be. This is due to a number of sobering trends. One is that premiums have escalated through the years, as insurers have increasingly found themselves grappling with mounting underwriting losses. Based on data by Wen Research for 2017, virtually all insurers in the scheme incurred underwriting losses. Losses of S$146 million were estimated in 2017, compared to under S$100 million in 2016.

For policyholders this presents a discomfiting dilemma, as the premium escalation is by no means even among the insurers. Some have hiked premiums more steeply particularly for older ages. As a policyholder ages, it becomes less easy to switch insurers as he or she may have developed health conditions that may be excluded by a new insurer. In addition, it is very difficult at the outset to have any visibility as to an insurer's portfolio of risk and the likelihood and extent of premium rises.