No more full rider policies for health insurance

From today, all new IP rider policies will require a co-payment of 5 per cent or more.

Existing full-rider policyholders will not be affected.

The IP is a consolidated insurance plan made up of two components – Medishield Life, a health insurance run by the government’s Central Provident Fund (CPF) Board, and private insurance.

Riders are optional add-ons on top of IPs. Currently, 29 per cent of Singaporeans are on full-rider policies.

About 100,000 of such policies are sold each year.


While Medishield Life and IP premiums can be paid for by Medisave, riders are paid out-of-pocket.

Although co-payment will be introduced for new rider policies, there will be a cap on the co-payment amount each year at $3,000 or more, ensuring that in the unlikely event of very large bills, policyholders minimise their risk exposure.

Medisave can also be tapped on to pay for co-payments under these new riders.

Minister of State Chee Hong Tat, who unveiled these changes at the Ministry of Health’s (MOH) Committee of Supply debate yesterday, explained that these changes are to avoid “disturbing” instances of over-consumption and over-servicing that leads to higher healthcare costs.

According to statistics provided by MOH, 97 per cent of full-rider policyholders are below the age of 65, but have higher bill sizes at 60 per cent more than the average bill size for policyholders without riders, indicating a lack of prudence in medical spending.

Mr Chee raised the example of a patient who opted for a $70,000 surgery for a breast lump removal despite there being a $5,000 alternative that is equally effective.

Such “buffet syndrome” use of rider policies has led to claim escalation – total claims for IP and riders increased 22 per cent in a year – from $858m in 2015 to $1.05b in 2016.

As costs of claims are shared across the framework of Medishield Life, IP and riders, rider-free policyholders are also affected by the rise in claims.

Mr Chee said: “It is clear that full riders have a detrimental impact on overall healthcare costs in Singapore.”

To provide time for insurers to develop their new products, new rider policies will only have to be available by Apr 1 next year.

In the meantime, insurers can keep selling their existing rider policies but buyers will have to be informed that they have to switch to the new rider policies by Apr 1, 2021 with the option to switch earlier once the new policy is available.

Mr Chee added: “We expect the new riders to have lower premiums than full riders, so the switch will result in premium savings for policyholders.”



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