Congrats on getting your first job! The first step to adulthood is securing a job and becoming financially independent. Once you start earning income, you are responsible for your own money and making decisions with it. It is a liberating feeling to be in charge of your personal finances, and it will be wise to take this opportunity to start planning for your future by considering purchasing insurance plans for yourself. In a survey Prudential conducted among 250 customers, the majority commented that a change in life stage such as entering the job market is the major trigger for purchasing health insurance.
Importance of having insurance
Before jumping into wealth accumulation insurance plans to build your savings or retirement plans for specific financial goals, consider protecting yourself and your finances first. Having protection plans provides a financial safety net in case of medical emergencies or unfortunate circumstances. With the help of the right basic protection plans, you would not have to worry about cash flow in case of emergencies. There are so many types of insurance available in the market and it can be quite daunting. As someone in your early 20s who is new to the workforce, what is the first insurance plan you should consider getting?
An Integrated Shield Plan
All Singaporeans are protected by the government’s basic health insurance plan called MediShield Life. Large hospital bills and selected outpatient treatments are covered under this insurance plan.
You may wonder why you need additional hospitalisation coverage from an Integrated Shield Plan when you already have MediShield Life health insurance coverage.
With MediShield Life, only a portion of your medical bill will be covered if you choose to get the treatment done at a private hospital or high-tier ward. There will be additional pre- and post-hospitalisation expenses that you are required to pay from your own pocket such as diagnostic tests, investigative procedures, medication and follow-up consultation. The last thing you want is to use your precious savings to pay for all these medical bills and expenses.
An Integrated Shield Plan is a private health insurance plan provided by insurance companies that helps boost the coverage provided by government-mandated MediShield Life. It is designed to complement your MediShield Life to provide coverage on top of what you’re already getting from MediShield Life.
So why should an Integrated Shield Plan be the first insurance plan you buy?
Medical inflation is expected to hit 10%1 in 2023 and 2024, leading to a 60% increase in hospital bills over the next 5 years2. The average cost of cancer treatment per month is estimated to be between $8,000 to $17,000. Having adequate hospitalisation coverage protects you and your family from unexpected medical expenses so you don’t need to dip into your savings – making an already difficult situation less stressful. Most importantly, it helps to relieve the burden on your family if they are the ones expected to pay for your medical bills. Therefore, it is important to have your basics covered with an Integrated Shield Plan before considering other insurance plans such as savings, investment or life insurance.
Generally, younger people have fewer health issues than older adults. Getting an Integrated Shield Plan when you are young and healthy allows you to enjoy the maximum coverage, without being subject to coverage exclusions due to pre-existing medical conditions. This way, you can protect yourself from the rising cost of medical expenses as early as possible.
PRUShield – Better healthcare coverage, for better lives.
PRUShield is one of the most popular MediSave-approved Integrated Shield Plans that provides affordable and comprehensive healthcare coverage payable with MediSave. It gives you access to Singapore’s private or public providers. You can also opt for supplementary benefits for extra protection to cover deductibles (the amount you need to pay before PRUShield benefits are paid out) and co-insurance (a percentage of the claimable amount you need to copay or share after you have paid for the deductible) to reduce your out-of-pocket expenses. You deserve the choice for more medical treatments options without worrying about medical expenses so you can focus on recovery and your loved ones can have a peace of mind.
The plan offers more affordable and competitive premiums with its first-in-industry (Prudential is the first to launch this in 2019) claims-based pricing on eligible PRUExtra supplementary plans when you stay healthy and don’t make claims, because your premiums will be determined by your claims activities in the year before.
In addition, policyholders with eligible PRUExtra supplementary plans can get seamless access to quality healthcare with PRUPanel Connect, a suite of value-added services at Prudential’s participating hospitals and specialists. With PRUPanel Connect, you can enjoy benefits such as appointment bookings, cashless transactions, concierge services and more.
Once you have secured the basic medical insurance coverage, you can look into other insurance options such as savings, retirement or investment to work towards your other financial goals. You can also further protect yourself with other health protection plans such as accident insurance, critical illness insurance, life insurance, etc.
Find out more on PRUShield and other insurance by speaking with a Prudential Financial Consultant for a non-obligatory consultation where they can guide you in finding insurance products that meets your needs.
1AON 2021/2022 Global Medical Trend Rates Report and Mercer Marsh Benefits Medical Trends.
2Calculated based on a year-on-year compound rate of 10%.
Disclaimer:
This article is for your information only and does not consider your specific investment objectives, financial situation or needs. We recommend that you seek advice from a Prudential Financial Consultant before making a commitment to purchase a policy. Information is correct as at 31 July 2023.