Why are the accumulated surpluses of ElderShield not public information?

I refer to the Ministry of Health’s (MOH) reply “ElderShield premiums collected meant to support future claims” (Straits Times Forum, Jun 4) to Mr Cheng Choon Fei’s letter (Current ElderShield insurers should return surplus premiums to MOH, May 31).

It states that “Long-term care insurance like ElderShield works by pooling together premiums paid by policyholders in their younger years while most are still working.

These funds are collected and invested, so that they are available in future years, when policyholders are no longer paying premiums and are more likely to suffer from severe disability.

Premiums collected under ElderShield currently exceed the claims paid out because the age profile of ElderShield policyholders is relatively young, with a median age of 52.

The premiums collected are not surpluses. They are meant to support future claims, when ElderShield policyholders become older and more of them become severely disabled and start to make claims.”

Arguably, a very important piece of information is missing from the subject reply – what is the accumulated surplus now (excess of premiums to claims plus interest over the years)?

As to “To illustrate, annual claims paid out have risen by 12 per cent per year from 2013 to last year, much faster than the 3 per cent increase per year in premiums collected over the same period.

We expect this trend to continue, in tandem with the ageing demographic profile of policyholders” -  if we assume that the accumulated surplus is now $3.6 billion and the claims last year was $30 million – using the calculator at http://financeformulas.net/Present_Value_of_Growing_Annuity.html - the projected number of years into the future for the accumulated surplus (assuming 4% interest and 12% increase in claims per annum) to run out is about 32 years.

However, the above does not account for the current 3% rate of increase in the premiums collected. So, how much longer may it be if this is included – about 40 years?

Also, given that the Government does not spend any money on ElderShield – why are we collecting such arguably, high premiums now and in the past?

With regard to “The Government will be administering CareShield Life on a not-for-profit basis. Any surpluses generated will stay within the fund and go towards benefiting policyholders through higher payouts or premium rebates” – to what extent will CareShield Life be like ElderShield in respect of premiums, claims, surpluses, etc?


Leong Sze Hian



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6 Responses to “Why are the accumulated surpluses of ElderShield not public information?”

  • Solution is regime change:

    Why? Because PAP is not open and transparent AND Singapore is not a REAL democracy. The only solution is regime change just like in Malaysia.

    GD Star Rating
  • "Not for profit"? HA:

    When the government says “not for profit”, do you believe?
    They run CPF not for profit also. How much investment return is kept away from CPF members? They just don’t call it profit, but lots of money go elsewhere.

    GD Star Rating
  • SMLJ also Accept:


    Every WHY is answered by :
    Because Simi Lan jeow singkies also dare not reject.
    53 years in a row. Towards a century!

    GD Star Rating
  • HarderTruths:

    Mr Hian – you know the answer as well as everyone else here.

    This is another money-grabbing exercise.

    After all – who is going to stop this?
    Ownself arrest ownself is not a likely solution.

    GD Star Rating
  • Parliament reboot !:

    The only WAY Singaporeans and NEW citizens are ensured of being treated fairly instead of being marginalized is………….. to


    One party system is a double edged sword in the long run.

    One party system is good for the pathing during early independence BUT

    will hurt the future generations in the long run.

    Our parliament needs some “catfish effect” to truly curb complacency, elitism and reactive mindsets among any leaders.

    Malaysia had proven to the world that even with the ruling party being brought down overnight, things are still running as usual and it’s “rebooting” for the better ! Malaysian are coming together and loyalty is growing !

    Compulsory increasing national premiums and costs of living are the fruitions of a ONE party system.

    Wake up before it turns into a nightmare !

    GD Star Rating
  • Leong, SG needs you..:

    Stand as an Independent if you do not wish to join any opposition party.

    Commenting in TRE is helpful but you need to stand up for what you believe in!

    GD Star Rating

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