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Singapore Insurance: 6 Key Differences Between Critical Illness Insurance and Medical Insurance (5-Min Read)

Many people often confuse critical illness insurance and medical insurance, thinking they are the same thing. They may assume that one insurance policy is enough, but that’s not the case. Let’s break down the 6 key differences between critical illness insurance and medical insurance.

Critical Illness Insurance (often called Life Insurance with Critical Illness Coverage in Singapore)
Medical Insurance (also called Hospitalisation Insurance or Integrated Shield Plan in Singapore)

1. What’s the difference in function?

  • Critical Illness Insurance: Provides a lump sum payout upon diagnosis of certain major illnesses (such as stroke, heart disease, cancer, etc.), helping the patient and their family through difficult times.
  • Medical Insurance: Covers hospitalization and surgery costs, including pre- and post-surgery outpatient treatments. It reimburses based on actual expenses.

2. Will premiums increase every year?

  • Critical Illness Insurance: Premiums are based on your age when you buy the policy and remain fixed for the duration. The older you are, the higher the premiums will be, but they won’t increase year after year.
  • Medical Insurance: Premiums are affected by your age and the type of hospital coverage you choose. They will rise as you get older.

3. Who should buy Critical Illness Insurance and Medical Insurance?

  • Critical Illness Insurance: Essential for the main breadwinner in the family, especially if you have dependents—elderly parents, children, or a spouse who relies on you.
  • Medical Insurance: A basic necessity for everyone, as everyone has a chance of getting sick.

4. How much coverage should you have?

  • Critical Illness Insurance: The coverage should be at least 5 years of your annual income, as recovery from a major illness typically takes 5 years. This ensures you can focus on getting better without worrying about living expenses.
    Example: If your annual income is SGD 100,000, it’s recommended to have a critical illness coverage of at least SGD 500,000.
  • Medical Insurance: Coverage is determined by the insurance company based on the level of hospital and treatment options, with a maximum coverage of up to SGD 2 million per year.

5. What should you look out for when choosing Critical Illness Insurance and Medical Insurance?

For Critical Illness Insurance, consider these three points:

  • Whole Life vs Term Life: The duration of coverage varies.
  • Cash Value vs No Cash Value: Some policies offer a savings component, while others are pure coverage.
  • Stage of Illness: Coverage may vary depending on whether the illness is in its early, middle, or late stage.

 

For Medical Insurance, keep these two points in mind:

  • Nationality:
    • Singapore Citizens and Permanent Residents (PR) already have Medishield Life, with the option to upgrade to an Integrated Shield Plan.
    • Foreigners need to directly purchase an Integrated Shield Plan.
  • Do you prefer private or public hospitals?
    • The private hospital plan covers both private and public hospital services.
    • The public hospital plan primarily covers public hospital services. If you end up in a private hospital, the insurance company will reimburse based on public hospital rates (pro-rated).

6. Is the claims process the same?

  • Critical Illness Insurance: No matter where you are, you can file a claim with a doctor’s certificate or memo (in English). The insurance company will pay you a lump sum in SGD (policy currency).
  • Medical Insurance: Singapore Citizens and PRs can use the e-filing system to register for hospitalization and don’t need to pay upfront. Foreigners must pay the medical expenses first and then claim reimbursement from the insurance company, or they can request a Letter of Guarantee for approval before hospitalization to avoid paying out of pocket.

What’s Next?

These two types of insurance complement each other. It’s not enough to buy just one. The purpose of insurance is to help you face unexpected events or illness without panic. For just a small portion of your salary, you can transfer the risk of a serious illness to the insurance company. It’s important to secure your basic coverage so that you can focus on work and live with peace of mind.

Curious about which insurance suits your needs? I’m here to help! Feel free to reach out.

📞 WhatsApp: +65 86802340
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Important: The information and opinions in this article are for general information purposes only. They should not be relied on as professional financial advice. Readers should seek independent financial advice that is customised to their specific financial objectives, situations & needs. This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.

Published By:

Lidwina Teo 维娜

With over 5 years of experience in client service industries, I come to understand and appreciate the importance of high-quality customer service and customer experience. The key is to always prioritize the best interests of customers, ensuring their needs and expectations are met with professionalism.

The passion for client service extends into my current role where I strive to deliver personalized financial planning services. With more than 150 business partners in our company, I can help you achieve your financial goals by analyzing various financial products and offering tailored financial advice. 

Contact me now to request for a quotation or schedule a coffee session for further discussion. See you soon!

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In compliance with the Personal Data Protection Act, Financial Alliance Pte Ltd (“FAPL”) seek your consent to collect and use your personal data (e.g. name, NRIC, contact numbers, mailing addresses, email addresses and photograph) for the purposes of and in accordance with FAPL’s Data Protection Policy, which can be found on FAPL’s website at https://fa.com.sg/data-protection-policy/.

根据《个人数据保护法》，鑫盟理财私人有限公司征求您的同意向您收集并使用您的个人信息。鑫盟理财将根据公司的个人数据保护政策所阐述的用途使用您的个人资料（例如姓名，证件号码，联系电话，邮寄地址，电邮地址和照片）。 该政策可在本公司网站上查寻，网址为 https://fa.com.sg/data-protection-policy/.

By submitting this form, you are deemed to have read and understood FAPL’s Personal Data Policy.

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  • I have read and understood FAPL’s Personal Data Policy, and hereby give my acknowledgement and consent to FAPL to use my personal data in accordance with FAPL’s Personal Data Policy.
  • 我已阅读并理解鑫盟理财私人有限公司的个人数据保护政策，并同意鑫盟理财私人有限公司根据个人数据保护政策所阐述的用途使用我的个人资料。
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  • I have not been directly contacted or approached by any representative or employee of FAPL with an offer or solicitation to apply for any financial products not offered in my home country.
  • 鑫盟理财私人有限公司的代表或员工并未直接与我联系或提出要约或招揽购买我原居住国境内所不提供的任何金融产品.
  • Financial Alliance Pte Ltd ( “FAPL”) is licensed by the Monetary Authority of Singapore (“MAS”) and allowed to conduct financial advisory activities in accordance with the Financial Advisers Act (Cap. 110) (“FAA”) and the Securities & Futures Act (Cap. 289) (“SFA”) within the jurisdiction of the Republic of Singapore and in accordance with the licenses granted by MAS
  • 鑫盟理财私人有限公司( “鑫盟理财”)持有由新加坡金融管理局(“MAS”)所颁发的牌照，并许可在新加坡共和国境内依据财务顾问法（第110章）和证券与期货交易法（第289章）进行财务咨询等相关业务
  • Any services provided by FAPL to persons not ordinarily resident in Singapore are provided solely on an offshore basis from Singapore, resulting from direct enquiry on the part of the foreign residents.
  • 鑫盟理财为非新加坡居民所提供的任何服务仅限于直接向鑫盟理财发出咨询请求的国外居民。
  • As an integral part of the provision of such services, FAPL may from time to time make available to such residents, documents and information making reference to capital markets products (for example, in connection with the provision of fund management or investment advisory services outside of the foreign jurisdiction).
  • 作为提供此类服务的一部分，鑫盟理财会不时向此类咨询者提供有关产品的参考文件和信息（例如，关于海外司法管辖区以外的资金管理或投资咨询服务等信息）。
  • Such documents and information are provided by Financial Alliance Pte Ltd (“FAPL”) is for general information only and is not intended for anyone other than the recipient.
  • 此类由鑫盟理财所提供的文件和信息仅供收件人做一般信息参考。
  • It does not take into account the specific investment objectives, financial situation or particular needs of any particular person.
  • 此类文件和信息不会把-个人投资目标，财务状况或其特定需求等考虑在内。
  • It does not constitute the making available of, or an offer or solicitation by FAPL to buy or sell or subscribe for any such capital markets product or to enter into a transaction or to participate in any particular trading or investment strategy nor an advice or a recommendation with respect to such financial products.
  • 鑫盟理财向该人士提供此类文件和信息将不构成要约或招揽购买或出售或认购任何此类资本市场产品，或达成交易或参与任何特定的投资策略，也不构成有关此类金融产品的建议或推荐。
  • These documents may not be published, circulated, reproduced or distributed in whole or in part to any other person without FAPL’s prior written consent.
  • 未经鑫盟理财的事先书面同意，不得将这些文件全文或部分发布，传播，复制或分发给其他人。
  • This document is not intended for distribution to, publication or use by any person in any jurisdiction, where such distribution, publication or use would be contrary to applicable law or would subject FAPL and its related corporations, connected persons, associated persons and/or affiliates to any registration, licensing or other requirements within such jurisdiction.
  • 鑫盟理财无意在分发，出版或使用此类文件可能违反当地法律，或本公司及关联公司或关联人士需要注册，获得许可或符合规定的司法权区向当地人士分发、出版此类文件或供其使用。
  • You shall ensure that you have and will continue to be fully compliant with all applicable laws in your home country when entering into discussion or contracts with FAPL.
  • 在与鑫盟理财进行讨论或签订合约时，您应确保您已完全遵守并将继续遵守您所在原居住国的所有适用法律及条规。

In compliance with the Personal Data Protection Act, Financial Alliance Pte Ltd (“FAPL”) seek your consent to collect and use your personal data (e.g. name, NRIC, contact numbers, mailing addresses, email addresses and photograph) for the purposes of and in accordance with FAPL’s Data Protection Policy, which can be found on FAPL’s website at https://fa.com.sg/data-protection-policy/.

根据《个人数据保护法》，鑫盟理财私人有限公司征求您的同意向您收集并使用您的个人信息。鑫盟理财将根据公司的个人数据保护政策所阐述的用途使用您的个人资料（例如姓名，证件号码，联系电话，邮寄地址，电邮地址和照片）。 该政策可在本公司网站上查寻，网址为 https://fa.com.sg/data-protection-policy/.

By submitting this form, you are deemed to have read and understood FAPL’s Personal Data Policy.

提交此表格，即表示您已阅读并理解鑫盟理财私人有限公司的个人数据政策