As we age, our health needs evolve, and so do our health insurance premiums. In Singapore, understanding how age influences these premiums can help you make informed decisions about your healthcare coverage. This article explores the relationship between age and health insurance costs, providing insights into what you can expect as you grow older.

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Age – Banded Premiums

Health insurance providers in Singapore typically use age bands to determine premium rates. This means that individuals within a specific age range pay the same premium. However, as you move into a higher age band, premiums increase to reflect the higher risk associated with aging.

For example, according to the Ministry of Health (MOH), the additional private insurance component of Integrated Shield Plans (IPs) is payable by MediSave, but only up to the following Additional Withdrawal Limits:

• $300 per year for those aged 40 years and below on their next birthday
• $600 per year for those aged 41 to 70 years on their next birthday
• $900 per year for those aged 71 years and above on their next birthday

These limits indicate that as you age, not only do premiums increase, but the portion payable by MediSave also rises, acknowledging the higher costs associated with older age groups.

Premium Increases with Age

Premiums for health insurance usually increase with age. This is because older individuals are more likely to require medical services, leading insurers to adjust premiums accordingly. It’s important to note that these premiums are not guaranteed and are subject to change. Insurers may choose not to renew a plan or charge a higher premium when there are excessive claims.

For instance, a 25-year-old will usually pay 40% less than a 45-year-old for a health insurance plan. Premiums begin to skyrocket after the age of 65. A 75-year-old, for instance, might pay over SGD 200,000 per year for a health insurance plan.

Impact of Age On Different Insurance Plans 

Different health insurance plans in Singapore have varying structures for premium adjustments based on age:

• Integrated Shield Plans (IPs): These plans offer additional coverage beyond the basic MediShield Life. Premiums are typically structured in age bands, with increases as you enter a higher age bracket. For example, premiums may change when the insured moves from the 36-40 age band to the 41-45 age band.
• Group Health Insurance Plans: Employers often provide group health insurance with premiums based on the collective risk profile of the group. However, individual premiums can still increase as employees age, especially when they move into higher age bands.

Planning for Future Premiums

Given that health insurance premiums increase with age, it’s crucial to plan ahead:

• Start Early: Purchasing health insurance at a younger age can lock in lower premiums and provide coverage before age-related conditions develop.
• Review Your Coverage: Regularly assess your health insurance plan to ensure it meets your current and future healthcare needs. As you age, consider plans that offer more comprehensive coverage.
• Budget for Increases: Be aware of the potential for premium hikes as you enter new age bands and budget accordingly to avoid unexpected financial strain.