Long-term care planning is increasingly vital for Singaporeans, especially with our rapidly ageing population. Two primary insurance schemes, ElderShield and CareShield Life, provide support for individuals with severe disabilities. Here’s a clear breakdown of how these two plans differ and their impact on your financial planning.
What is ElderShield?
Introduced in 2002, ElderShield is a basic severe disability insurance scheme providing financial assistance to those unable to independently perform daily activities. Although closed to new entrants since 2020, ElderShield remains active for existing policyholders.
Key Features:
- Automatic enrollment at age 40 for Singapore Citizens and Permanent Residents.
- Monthly payouts fixed at either S$300 (up to 60 months) or S$400 (up to 72 months).
- Eligibility requires inability to perform at least 3 of the 6 Activities of Daily Living (ADLs).
- Premium payments from age 40 until age 65.
What is CareShield Life?
CareShield Life, launched in 2020, is an enhanced long-term care insurance scheme designed to provide more extensive and lasting financial protection.
Key Features:
- Compulsory enrollment at age 30 for those born in 1980 or later.
- Lifetime monthly payouts starting at S$600 (in 2020), with an annual increment of 2% until age 67 or upon claim.
- Premium payments span from age 30 to 67, with subsidies of up to 30% available for eligible individuals.
- Lifetime coverage ensures ongoing financial support.
Comparison at a Glance
| Feature | ElderShield | CareShield Life |
| Enrollment Age | 40 | 30 |
| Monthly Payout | Fixed S$300–400 | Starts at S$600, increasing yearly |
| Payout Duration | 5–6 years | Lifetime |
| Premium Payment Period | Ages 40–65 | Ages 30–67 |
| Subsidies | None | Up to 30% |
| Availability | Closed to new entrants | Open and compulsory |
The True Cost of Long-Term Care
Long-term care expenses in Singapore are substantial and frequently underestimated.
Average Monthly Costs:
- Home caregiving services: S$1,200 – S$2,000+
- Home nursing or physiotherapy sessions: S$60 – S$150 each
- Private nursing homes: S$2,000 – S$4,500
The average monthly long-term care cost is estimated at around S$2,952. CareShield Life’s anticipated payout of about S$662 per month in 2025 covers roughly 22% of these costs.
Addressing the Financial Gap
To adequately bridge this financial gap, additional measures should be considered:
- CareShield Life Supplements: Private insurance enhancements that provide higher monthly payouts.
- Government Grants: Such as the Home Caregiving Grant (S$400 monthly) and other means-tested assistance schemes.
Upgrading from ElderShield to CareShield Life
For Singaporeans born in 1979 or earlier and currently on ElderShield, upgrading to CareShield Life provides:
- Lifetime coverage with higher and escalating payouts
- Government-supported premium incentives and subsidies
- Gradual premium adjustments spread over 10 years
Personalised Financial Advice
Choosing or upgrading your long-term care insurance is an important decision. For personalised guidance tailored to your unique needs and circumstances, please reach out to me. Let’s ensure you are comprehensively covered for a secure financial future.
