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Brandan Chen

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Stand a chance to win prizes by reading the article below and answering the question within. T&Cs apply.

Education

Want to Know How Much You’ll Spend on Critical Illness Care Without Proper Coverage?

If you were to fall critically ill, do you know whether your health insurance would cover all the incurred medical bills? And beyond the medical expenses, how would your plan cover your daily living expenses or loss of income while you can focus on the recovery? These are questions that many individuals hope they never need to find out, but many unfortunately will be faced with difficult decisions to make it through a chronic illness or injury.

Did you know that a patient in Singapore will spend an average $32,000 for critical illness treatments? In a December 2019 survey, Manulife found that Singaporeans spent an average of $32,000 treating critical illnesses, while 15% of those surveyed spent more than $50,000 (Manulife 20204).

It’s important to understand that skipping critical illness insurance can be a costly mistake, no matter the age or stage of your life. While we often consider what would happen to our families if we were to die prematurely, we rarely consider the physical and financial toll critical illness would take on our loved ones if we were unprepared. Here are things to consider if you’re still unsure of the importance of critical illness coverage.

The Chances of Being Diagnosed with A Critical Illness is High (NRDO (June 2017)5

The National Registry of Diseases Office estimates one in every four or five Singaporeans are at risk for developing cancer (NRDO 20175). 25% of women and 20% of men on average will either suffer from cancer or a heart attack before retiring (Money to the Masses 20201). Since critical illness coverage is often available for people between the ages of 17 and 70, the earlier you get covered, the sooner you will be financially protected.

Standard Health Insurance Will Not Cover All Expenses Accrued from A Critical Illness (Kumok, Zina (June 2019)2

A critical illness plan can often bridge the gap for what your health insurance can’t cover – including lost income, personal expenses, and more. It’s unlikely that you would be able to continue working for a period of time after getting inflicted by a serious illness (e.g. stroke) or during intensive cancer treatments, so a critical illness policy will cushion your loss of income and incurred personal expenses with a lump sum. This will also protect your family, as it can be used to cover important monthly bills that they may depend on for housing and food.

Chronic Illnesses or Conditions Will Drain Your Savings Account Over Time (LIA Singapore (October 2018)3

A 2017 Protection Gap Report found that Singaporeans require an average of 3.1 times their annual income in order to adequately meet their critical illness needs – paying that out of pocket will drain your savings over time (LIA Singapore 20183). The pay-out of critical illness policy will come in handy for extra help, covering the medical bills as well as the potential loss of income during recovery. Most importantly, it gives yourself and your family the peace of mind necessary to focus on optimizing your recovery in these situations.

The type and amount of critical illness coverage you may need will vary from person to person, so be sure to research and understand the options available before making a decision. We recommend that you seek advice from a Financial Consultant before making a commitment to purchase a policy.

This article is a part of Answer & Advance, our 8-week contest series where you can stand to win awesome prize reading the article above and answering a simple question. Answer the question correctly and join in others to unlock the next tier of prizes! Find out more about the contest here.

Learn more about the importance of understanding Critical Illness, Savings, Investments and Financial Planning with me. Participate, share and unlock up to a total worth of S$20,000 e-vouchers in the 4 different tiers along the way! T&Cs apply. Find out more here.

Week 3

How much on average does a patient spend on Critical Illness treatment?

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Alternatively, you may contact us at brandan.chen@manulife.com.sg.

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Content Sources
1 - Fahy, Damien (April 2020), Critical illness insurance – what is it, and is it worth having?, retrieved from Money to the Masses
https://moneytothemasses.com/quick-savings/insurance-2/critical-illness-insurance-what-is-it-and-is-it-worth-having
2 - Kumok, Zina (June 2019), Critical Illness Insurance: What Is It and Who Needs It?, retrieved from Investopedia
https://www.investopedia.com/articles/personal-finance/010416/critical-illness-insurance-who-needs-it.
3 - Life Insurance Association Singapore (April 2018), 2017 Protection Gap Study – Singapore, retrieved from LIA Singapore
https://www.lia.org.sg/media/1332/protection-gap-study-report-2017.pdf
4 - Manulife (February 2020), The Real Cost of Being Critically Ill in Singapore, retrieved from Manulife
https://www.manulife.com.sg/en/about-us/newsroom/manulife-survey-1-out-of-3-critical-illness-patients-have-used-up-most-or-all-their-savings.html
5 - NRDO (June 2017), Singapore Cancer Registry, retrieved from National Registry of Diseases Office
https://www.nrdo.gov.sg/docs/librariesprovider3/Publications-Cancer/cancer-registry-annual-report-2015_web.pdf?sfvrsn=10