Severe Disability: Are Singaporeans Unprepared?

An Aviva survey recently revealed that 95% of Singaporeans think severe disability can happen at any time and to anyone. Yet 50% believe they will continue to stay healthy and are unlikely to need long-term care.

Severe disability: a definition

Severe disability is defined by the inability to perform three or more activities of daily living (ADL). These are are basic self-care tasks such as washing, feeding, toileting, dressing, transferring and walking. Disabilities related to performing ADLs are expected to increase from 9% in 2014 to 15% in 2050.

severe disability

90% of respondents are worried about how they might finance their long-term care needs in the event they become severely disabled. 69% lacked confidence in their or their families’ ability to pay for the necessary healthcare. 64% doubted they could continue to afford daily expenses if they were to become disabled.

How much will it cost to finance long term care needs?

Note that Aviva’s 2018 Long-term Care Study revealed that the average monthly cost amounts to $2,324 (and likely to increase further with inflation). This includes:

  • aids to help in daily living,
  • everyday living expenses,
  • care-giver expenses,
  • medication and
  • therapy and miscellaneous expenses.

severe disability

Where will the money come from?

68% of Singaporeans feel that the individual is responsible for financing, while 83% of these respondents intend to finance their long-term care needs through MediSave.

Currently, Singaporeans aged 30 and above can:

  • withdraw up to $200 per month to supplement their long-term care needs from their MediSave Care account.
  • choose to use up to $600 a year from their MediSave to pay for CareShield Life Supplements to obtain higher coverage, and 86% say they are likely to do so
  • withdraw at least $600 a month from CareShield Life (amount increases if payouts start later)

However, this is far from the $2,324 figure highlighted by Aviva.

severe disability

What we can do, is get disability insurance during our working years, because according to Aviva article:

  • it’s easier to secure coverage because of your age and state of health
  • premiums are cheaper when you’re younger
  • you have the income to pay premiums
  • you have dependents who rely on your income to get by should the unexpected happen

severe disability

Other options are:

  • upgrading to Careshield Life (if you’re a Singapore Citizen or PR born in 1979 or earlier, you may choose to join CareShield Life from end-2021 onwards if you are not severely disabled)
  • adding long-term care costs into your financial planning goals
  • looking after your health (physical, emotional and mental well-being) on a regular basis e.g. exercising and eating well,
  • settle your Lasting Power of Attorney (LPA), will (and decide on guardianship for your children) and CPF nomination in advance

Special thanks to Aviva for the information.

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