‘Don’t be Fomo’, wait for clarity on revised premiums before renewing IP riders: advisers

[SINGAPORE] Consumers should not be gripped by “fear of missing out”, or Fomo, and should adopt a wait-and-see approach when deciding whether to renew or sign up for existing Integrated Shield Plan (IP) riders, industry players said.

They spoke to The Business Times ahead of the Ministry of Health’s announcement on Wednesday (Nov 26) that insurers will no longer be allowed to sell riders that fully cover a patient’s minimum deductible from Apr 1, 2026.

Existing policyholders – riders are typically renewed yearly – will not be affected for now. Insurers may continue selling current riders until Mar 31, 2026, though all affected policyholders must transition to the new requirements by Apr 1, 2028.

Riders, which are paid fully in cash, are optional add-ons that reduce out-of-pocket costs by covering deductibles and co-payments.

Under the revised rules, premiums for new riders are expected to fall by about 30 per cent, ministry estimates showed. This translates to average annual savings of about S$600 for private-hospital IP rider policyholders and S$200 for those on public-hospital riders.

Given these pending changes, consumers should wait for insurers to roll out updated premiums before committing, said Alex Lee, president of the Singapore Actuarial Society.

“Don’t be Fomo,” said Lee. “Even if you get better terms from (existing riders), eventually, by 2028, it will revert to the new rules.”

He said consumers can take the savings from the cheaper riders to pay future deductibles, which will no longer be covered once the new regime takes effect.

Still, the transition could feel like a downgrade for some policyholders, said Paul Wong, a financial adviser at IPP Financial Advisers – particularly for those who have paid premiums over many years without making a claim.

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“I don’t know how the premiums will change, but one thing is for sure – it will be very uncomfortable in the beginning to have these conversations (with clients),” he said.

Financial adviser Chia Xian Min, speaking in her personal capacity, agreed that some clients may be “unhappy”, especially those who have “been paying premiums all this while and expecting a certain kind of coverage, and they have never claimed” previously.

Riders that cover the deductible are “very popular” among her clients, she noted.

This is especially common among parents with young children – such as Chia herself – nearly all of whom opt for full-deductible coverage for the “peace of mind” it offers.

For instance, some parents request overnight admissions for their child even when a ward stay is not medically necessary.

Advisers will now need to explain the revised requirements clearly, said Chia, with an emphasis that this is a “national-level” shift affecting all policyholders.

For Wong, the shift is also an opportunity to reframe the role of insurance. He said clients should view insurance for its core purpose as a risk-pooling mechanism, rather than something for one “to enjoy”.

“If you don’t use it, it’s actually a good thing,” he added.