If you look around you, you'll realize that disability isn't just a problem that solely affects the elderly; it can happen to anyone. Even young, healthy people can become incapacitated overnight and become fully reliant on others for the most basic activities– whether it’s due to an accident or a sudden illness.
Many of us had the misconception that only the elderly experience disability. However, it appears that this is not the case, as the three leading causes of impairment in Singapore— accidents, disease, and old age are not only based on a person’s age at all.
And that’s when we come to realize that, just as the healthiest person might be diagnosed with cancer out of the blue, the unluckiest person can become crippled overnight.
A young man in his 20s became totally dependent on a caregiver, at an age when impairment is least likely to strike. He was involved in an automobile crash that left him with lasting injuries.
Another example: a lady in her mid-30s who was the family breadwinner, yet is now undergoing therapy at a hospital after slipping down the road and suffering a stroke.
Sure you can imagine how hard it can be for someone suffering from a disability to pick themselves up from the situation, and how much more difficult it would be for them if they also face financial difficulties. It will be even more stressful, not only for the victim but also for their loved ones, who may now have to be the primary caregiver, footing the additional expenses, and taking on other responsibilities.
Assess your household expenses
This is why it’s important for partners to have an in-depth conversation regarding long term care. Assess your current household expenditures and consider this scenario: If one of you were to quit contributing your income, then you would eventually be facing difficulties because your emergency funds can only last us up to a year of spending.
So now take time to review your insurances and make sure that the basics (health, life, critical illness) are covered. Long-term disability insurance is something that needs to be discussed well with your partner.
Protect yourself from unanticipated events
In life, we all experience our share of highs and lows. Some situations may be positive, while others may be negative. Things can eventually go wrong, but we can take actions to protect ourselves and the people we care about as much as possible.
Having a savings cushion in case of an unexpected expense is essential. These will help you get by in the event of an emergency, such as losing your job or incurring an expensive medical bill. In addition, insurance plays an important role in saving you from any financial risks.
Let’s say, you and your partner have 5 kids and are struggling to make ends meet after one of you loses your job. As you lose another source of income, your budget allotted for the family is also reduced. While you can’t afford to mess things up and face the risks, you can consider some types of insurance like life & health insurance. Don’t forget the long-term disability insurance if you don’t want to burden your kids financially in the future.
The truth is that we should be carefully planning for our children’s education, parent’s retirement, and our own, since any significant and unexpected hit might potentially ruin our entire plan.
This emphasizes the need of insurance in protecting against potential loss of income due to unforeseen circumstances. Furthermore, disability is another situation that is extremely grave and should not be overlooked.
Does one require disability insurance?
Take a look at these facts and make up your own mind:
- Stroke can affect even the young and healthy people. In fact, according to StraitsTimes news (2017), a Singaporean teenager, 19 years of age, spent a whole year rehabilitating from his stroke before he was able to walk without assistance.
- The number of stroke patients in Singapore between the ages of 15 and 49 has increased by over 20%, with a particularly sharp rise among those between the ages of 15 and 29.
- Some stroke victims are unable to function independently even after a decade, which is due to the long-term effects of a stroke. This adds huge expenses on the victim’s side and their family.
You might want to answer these yourself:
- Do you have sufficient resources to cover the cost of long-term care (including medical and caregiver expenses) plus the inflation?
- What happens if you get disabled and are unable to work?
- Is it possible that your family may have to shoulder the financial burden? What if your kids are still in elementary school, though?
While many take their health and mobility for granted, accidents and illnesses are the leading causes of disability among Singapore’s younger population. It is possible to get struck by a careless rider and fall to the ground while strolling on the sidewalk, be involved in a car accident (due to reckless driver), or suffer a stroke suddenly and unexpectedly.
If we take a look at statistics, the prevalence rate of individuals with disabilities aged 18–49 is over 3 in 100, according to a local 2015 NCSS sample. This means that there is still a chance the young individuals can become disabled at a young age.
Is CareShield Life not sufficient?
Based on the expenses related to long-term care, CareShield Life is not and will not be adequate coverage.
With the current payout rate of $612 per month, there isn’t enough money for basic necessities like food and transportation, let alone medical expenses and rehabilitation services.
Even with the levy concession (paying $60 per month instead of $300), the average cost to employ a foreign domestic helper is $700.00 per month. On the other hand, hiring more competent and experienced workers will cost you a higher price.
What more if you’re required to stay in a nursing home, it can quickly add up to several thousand dollars.
The national insurance scheme may help us ease our long-term care but only to some extent. Since what they provide us is just the basics, it is our individual obligation to supplement it with private insurance and/or sound financial planning.
Ask yourself whether $600 would be enough for you to spend on today’s healthcare expenses.
If you answered “NO,” you should consider beefing up your security measures and start upgrading your current Careshield Life through these 3 private insurers: Singlife with Aviva, The NTUC Income, and Great CareShield.
How much do I need?
It is best to start by calculating how much money you will need for long-term care in the event of a disability. You should include in the costs of hiring a caretaker, receiving medical care (especially if it’s not covered by your health insurance), and rehabilitation therapy.
As an alternative, you can use Great Eastern’s disability calculator to get a better estimate for your potential financial support needs:
You may or may not require more than that, depending on your own preferences and the severity of your condition.
As much as we would like to have our income protected and our long-term care expenses covered, we also place a high importance on having access to treatment and rehabilitation services as soon as we become unable to do even one of the activities of daily living (ADLs).
With so many people counting on us financially, it seems almost futile for one of us to take on the role of primary caretaker rather than both of us continuing to work to make up for the income gap. Therefore, it is preferable to have supplementary benefits that can help support a caregiver, together with the dependents.
While some insurance policies may provide for as much as $5,000 per month in benefits, you can settle on a more modest sum of at least $2,000 per month to cover your long-term care expenses for the time being. If expenses go up more quickly than expected, you may look into purchasing additional insurance later on.
Conclusion
Getting insured against the possibility of disability is a must for everyone, regardless of age or marital status.
The national insurance scheme, CareShield Life, may provide us just the basics and won’t be sufficient for our long-term care needs. Thus, it’s our responsibility to supplement it to provide us the best coverage should we become disabled.
If money is a concern, you reduce your coverage to a level you can afford and consider increasing once your finance and circumstances allow you to.
This way, if the worst should happen, you won’t have to worry about burdening your family financially while they deal with your recovery.