Ealth Nsurance: Chapter Review

Health Insurance Strictly for Internal Use Only
HEALTH INSURANCE
(6th Edition)
Supplementary Notes Version 1.1
Chapter Review
Chapters 1 to 14
Prudential Assurance Company Singapore (Pte) Limited 1

Produced in collaboration with Julia Sim. Based on 6th Edition, (Version 1.1)(12/6/17)
Chapter 1 – Overview of Healthcare Environment in

Singapore
1. Introduction
1. Rising healthcare cost is a concern for most governments. The challenge faced by most
governments is how to balance the rising expectations for quality healthcare, and yet
keep cost affordable.
2. Healthcare Philosophy
1. Singapore's healthcare system is designed to ensure everyone has access to different levels
of healthcare in a timely, cost-effective and seamless manner. Healthcare services are
accessible through a wide network of primary, acute and intermediate and long-term
care (ILTC) providers. It is designed to promote health, prevent and reduce illness and
ensure Singaporeans have access to good and affordable healthcare.
2. MOH has put together a "Healthcare 2020" Masterplan to improve healthcare services for
Singaporeans. It focuses on 3 strategic objectives to enhance healthcare, namely:
• accessibility;
• quality;
• affordability
A. Enhancing Accessibility
1. Healthcare infrastructure will be ramped up, with plans to increase acute-and community
hospital beds by 2020.
2. MOH is building up its manpower capability & building a strong core of healthcare
professionals to support infrastructure expansions eg:
• Providing flexi, part-time in the community through its Place & Train Programme;
• New remuneration framework for senior doctors to better recognize doctors in their
diverse roles in clinical care, education, research & administration.
• MOH actively drives innovation & productivity in both public & ITLC sectors to simplify
workflow process so that healthcare workers can focus on caring for their patients.
B. Enhancing Quality Of Care

1. MOH will move away from doctor-centric services & adopt a multi-disciplinary team approach
to enhance chronic disease management. Eg healthcare clusters.
2. Elderly people are more likely to than younger people to need hospital care. MOH will
enhance primary care as Singapore's population ages so that residents can be better cared
for in a community. Egs:
• Strengthening primary healthcare providers, such as polyclinics & GPs;
• Building more polyclinics.

C. Ensuring Healthcare To Remain Affordable

1. The Government has enhanced support for Singaporeans in the following ways:
• Increasing Government share of national healthcare expenditure - through enhanced

subsidies for services in SOCs & drugs in public hospitals and list of subsidized drugs;
• Medisave expanded to use for more types of outpatient treatment to reduce out-of
pocket costs for outpatient care.
• Enhancing collective responsibility for healthcare through MediShield Life.

The Government bears most of the cost of this universal coverage.
3. Healthcare System in Singapore

1. There are 3 main types of healthcare services, based on Western Medical Science. They are
namely:
A. Primary healthcare services;
B. Hospital Services;
C. ILTC Services.
There are also traditional medical treatments, such as Traditional Chinese Medicine (TCM).
2. MOH seeks to provide patients with holistic and integrated care. The Agency for Integrated
Care (AIC) was set up to smoothen the transition of patients from one care setting to another.
Each regional healthcare cluster is anchored by a regional hospital working with a variety of
primary, ILTC and support services to deliver patient-centric care.
A. Primary Healthcare
1. Provided by both public and private sectors. It involves provision of basic medical
treatment, preventive healthcare and health education.
2. In public sector, primary healthcare services are provided through network of

outpatient polyclinics . Under Community Healthcare Assist Scheme (CHAS),
lower-to-middle income household can receive subsidized treatments at GPs
and dental clinics, without the need to travel to Polyclinics.
3. The Scheme also covers treatment for Chronic Disease Management Programme
(CDMP) such as diabetes, hypertension, root canal treatment and crowning.
4. Patients under CHAS can also enjoy subsidized rates at Specialist Outpatient
Clinics.
B. Hospital Services
1. There are 9 public hospitals and within these public hospitals, choices of different
types of ward accommodation. 81% of public hospital's beds are B2 and C which
are heavily subsidized. 19% with lower subsidy at 20% for Class B1 and no
subsidy for Class A wards.
2. Government has restructured all its acute hospitals and specialty centres to run as
private companies, wholly owned by Government, to allow greater autonomy
and flexibility. Commercial Accounting Systems have been introduced to give a

accurate picture of operating costs, instilling greater financial discipline and

accountability.
3. Public hospitals received annual government subvention or subsidy for the provision
of subsidised medical services of patients. These are to be managed like not- for-
profit organisations. These public hospitals are subject to broad policy guidance
by the government through MOH.
C. Intermediate & Long Term Care (ITLC)

1. ITLC services are for people who need further care after discharge from acute hospitals
as well as community dwelling seniors who may need assistance with their activities of
daily living. This can be through:
a) Home-based services, which are provided within their homes of frail and home-
bound elderly.
b) Centre-based healthcare services, which cater to older persons who require care
services during the day, usually on a regular basis, located within the community.
This allows working caregivers to drop off their seniors, while they are working.
c) Residential ILTC services, comprises community hospitals, chronic sick hospitals,

nursing homes, inpatient hospices and sheltered home for the ex-mentally ill
patients.
4. Healthcare Financing
1. Singapore Healthcare financing framework comprises of Government subsidies, individual
savings and insurance.
Singapore Healthcare Financing Framework
Government Subsidies Individual Savings Insurance
Government provides Through the Medisave • MediShield Life

significant subsidies across all Scheme, it helps individuals • Medifund
healthcare settings to help with care for their own as well as • ElderShield
healthcare costs. immediate family's medical (cross ref - chapter 8)
expenses.
2. The Singapore Government provides universal coverage through these multiple layers of
protection:
a) Government Subsidies
• Government subsidies across primary, acute rehabilitative and nursing care; and
• Universal access, but no 100% subsidy to avoid over-consumption.
b) Compulsory Healthcare Savings

• Individual medical savings accounts - Medisave.

c) Risk-Pooling via Insurance Schemes

• National basic health insurance scheme - MediShield Life;
• Private health insurance for additional coverage - Medisave approved Integrated
Shield Plans (IPs); and
• Severe disability insurance for old age- ElderShield and ElderShield Supplements.
d) Ultimate safety net for the needy

Endowment fund set up by the Government for needy Singaporeans through Medifund.

Chapter 2 – Medical Expense Insurance
1. Health Insurance
1. There are broadly 3 categories of Health Insurance which can provide:
• A reimbursement for the cost of medical treatment or nursing care; or
• A periodic income upon disability or hospitalization; or
• A fixed cash amount upon disability or suffering from a major illness.
2. Insurers and their financial adviser representatives providing advice on or arranging

contracts of insurance or both, in respect of Health Insurance products must comply
with Notice No: MAS 117 on "Training and Competency Requirement : Health
Insurance". This Notice covers minimum examination requirements, and Continuing
Professional Development (CPD) requirements in respect of shield plans.
2. What is a Medical Expense Insurance (MEI)?

Also known as Hospital and Surgical (H&S) Insurance, which provides inpatient and some
outpatient benefits. Examples of MEI include MediShield Life, Private Integrated Shield
Plans and managed healthcare schemes.
A1. What Is Covered Under MEI?

MEI Plans in Singapore covers the basic benefits described below:
(i) Inpatient Expenses: (ii) Outpatient Expenses

 Daily room & board;  Pre-hospitalization diagnostic and
 Intensive care unit; laboratory tests charges;
 Short stay ward;  Pre-hospitalization specialist
 Hospital miscellaneous; consultation charges;
 Surgeon’s fees;  Post hospitalization specialist
 Anaesthetist’s fees; consultation charges;
 Surgical implant & prosthesis;  Accident & emergency (A &E)
 Confinement in community hospitals; treatment;
 Inpatient psychiatric treatment;  Emergency accidental treatment
 Congenital anomalies; charges.
 Inpatient pregnancy complications;
 Radiosurgery;
 Stem cell transplant;
 Emergency overseas inpatient treatment;
 Accident inpatient dental treatment;
 Major organ transplant;
 Living donor organ transplant.
(iii) Catastrophic Outpatient Expenses
 Outpatient kidney treatment charges;

 Outpatient cancer treatment charges;
 Major Organ transplant approved immunosuppressant drugs.

A2. Inpatient Expenses

a. Daily Room and Board Charges refers to the charges for standard room accommodation,
meals and general nursing services incurred while insured is hospitalized.
b. Intensive Care Unit Charges – charges incurred during the confinement in the ICU of the
hospital.
c. Short –stay ward – incurred during confinement in the short stay ward in an accident and
emergency dept of a hospital for inpatient monitoring and treatment up to 24 hrs to allow
doctor to decide whether to discharge the patient or further admitted as an inpatient.
d. Hospital Miscellaneous Expenses includes services and supplies (other than room and
board and general nursing care):
• Laboratory services;
• X ray examinations;
• Medicines and drugs;
• Surgical dressings;
• Operating room expenses;
• Oxygen and their administration; and
• Ambulance service.
e. Surgeon’s Fees – surgeon’s fees for surgery, includes day surgery and gamma knife.
f. Anaesthetist’s Fees – for the supply and administration anaesthesia.
g. Surgical Implant & Prosthesis - actual costs of surgical implant of artificial devices used to
replace missing part of a body.
h. Stay in Community Hospital – charges incurred for accommodation, meals and general
nursing services. A referral from the attending physician from the hospital is required and the
admission to the community hospital must be within a time frame following his discharge from
the hospital.
i. In-Hospital Psychiatric Treatment – must be received as an inpatient of the hospital.

A waiting period may apply. Treatment for self inflicted, suicide, drug addiction or abuse of
drug or alcohol is excluded.
j. Congenital Anomalies – inpatient treatment of any congenital anomalies, including

hereditary conditions. A waiting period apply.
k. Inpatient Pregnancy Complications – inpatient treatment for pregnancy complications.

Waiting period apply. This benefit may be restricted to the following pre- defined list of
complications:
• Ectopic pregnancy;
• Pre- eclampsia or eclampsia;
• Disseminated intravascular coagulation;
• Miscarriage after 13 weeks of pregnancy(not resulting from voluntary or malicious act);
• Antepartum haemorrhage;
• Intrauterine death;
• Choriocarcinoma and hydatidiform mole;
• Acute fatty liver pregnancy;
• Breech delivery and placenta previa and postpartum hemorrhage;
• Placenta previa; and
• Postpartum haemorrhage.

l. Radiosurgery
This refers to charges for Gamma Knife and Novalis radiosurgery (including day surgery) by a
surgeon in a hospital.
m. Stem Cell Transplant

Refers to charges for stem cell transplant surgery. All other costs incidental to the stem cell
transplant, as well as outpatient therapies, where there is no surgery or admission, are not
covered.
n. Emergency Overseas Inpatient Treatment

Refers to charges for inpatient treatment resulting from an emergency while overseas.
Pre- and Post hospital treatments which are given before and after emergency overseas
treatment are not covered.
o. Accident Inpatient Dental Treatment

Refers to charges to remove, restore or replace sound natural teeth which have been lost or
damaged in an accident. Treatment must be received within 14 days following the accident.
p. Major Organ Transplant

Refers to the costs of surgeries for the transplantation of kidneys, lungs, heart, liver or cornea,
where the insured person is the recipient of any of the organs.
q. Living Donor Organ Transplant

Refers to charges for major transplants of the kidney or liver, where the life insured is a living
donor, provided that:
(i). Transplant is carried out in a hospital in Singapore;
(ii). Recipient of the organ must be insured person’s family member (i.e parent, sibling,
spouse or child);
(iii). The recipient’s kidney or liver failure is first diagnosed by the attending physician, or the
symptoms of which first appeared, after a waiting period of 24 months.

A3. Outpatient Expenses

a. Pre-hospitalization Diagnostic and Laboratory Test Charges
Charges incurred for diagnostic and laboratory tests as prescribed by the attending
physician. This benefit is payable if incurred within a specified number of days before the
date of hospitalization.
b. Pre- hospitalization Specialist Consultation Charges

Charges incurred for consultation of a specialist as recommended by the attending
physician. This benefit is payable if insured is hospitalized or undergoes days surgery
within a specified number of days from the date of consultation of the specialist.
c. Post – Hospitalization Specialist Consultation Charges

Charges incurred for follow up treatment after hospitalization, eg physiotherapy etc. This
benefit is payable for up to a specified number of days after his discharge from the
hospital.
d. Accident & Emergency (A & E) Treatment

Refers to the treatment in the accident and emergency dept of a hospital up to 24 hours,
before an inpatient treatment for the same injury or illness.
e. Emergency Accidental Treatment Charges

Charges incurred for emergency outpatient treatment of accidental bodily injuries,
within 24 hours of the accident.
A4. Catastrophic Outpatient Expenses

a. Outpatient Kidney Treatment Charges
Charges incurred for kidney dialysis at a legally registered dialysis centre. Includes
examinations and tests ordered by the physician. Exclude purchase or rental of the dialysis
machine.
b. Outpatient Cancer Treatment Charges

Charges incurred for chemotherapy, radiotherapy, immunotherapy and/or stereotactic
radiotherapy, provided by the hospital, including examinations and tests ordered by the
attending physician for the course of treatment.
c. Major Organ Transplant Approved Immunosuppressant Drugs

Drugs approved by the Health Science Authority as part of the necessary medical treatment,
as an outpatient after a major organ transplant to reduce the rate of rejection episodes. The
major organ transplant must first be approved under the policy.

B. Other Benefits Under MEI
1. Specific Disease Insurance

Provides a lump sum payment in the event of the diagnosis from the specific disease covered
by the policy.
2. Miscarriage Benefits
Refers to cost incurred in a miscarriage or ectopic pregnancy, However , the coverage is not
applicable to willful termination of a pregnancy that is not medically necessary.
3. Private Nursing Home Care

Pays for the cost incurred in hiring the services of a fulltime/ part time qualified nurse in the
insured’s home for the continuing treatment of a medical condition which is covered under
the policy for which the insured person has been hospitalized.
4. Daily Hospital Cash

A daily cash benefit is payable to the insured if he is hospitalized as a result of an injury or
illness.
5. Emergency Medical Evacuation

Refers to the costs of getting the insured person to a place for accessibility to medical
treatment because of a serious injury or sickness while overseas .
6. Final Expenses Benefit

Death occurring during hospitalization or within a specified number of days after hospital
discharge, and provided death is a result of the cause of the hospitalization. In the case of
an Integrated Shield Plan, the final expenses benefit is usually a waiver of deductible and co-
insurance components up to the stated amount in the policy.
C. What Are The Limits On The Covered Expenses?
1. MEI provides benefits in 2 ways:

• “As Charge” Benefits;
• Imposed Sub- Limits
2. Note that payment is on a reimbursement basis, hence insurer will reimburse the actual
amount incurred or the maximum limit stated in the policy, whichever is lower.

3. Key Features Of Medical Expense Insurance
Features Of MEI Details
Forms it can be purchased • Standalone;

• Rider (not common in Singapore).
Choice of Plan Option to choose a plan that best meets the needs and budget
in terms of the following:
• amount of general medical expenses provided by the
policy, such as hospital type and/or room & board charges;
• per policy year, per disability and per lifetime limits; and /or
• amount of deductible and/or co-insurance which he needs
to bear.
Plans with higher benefits will cost more premiums.
Family coverage • MEI Policies allow the policy owner to include immediate
family members (i.e spouse and children) in the policy.
• Gives the flexibility of selecting different plans for his
family members.
• Provides a family discount (e.g 5% ) if the application is
submitted at the same time.
Reimbursement of • Reimbursement basis - insurer will reimburse the policy

Expenses owner up to maximum dollar amount which the insured
incurs.
• Policy owner is not allowed to claim more than the actual
medical treatment expenses incurred .
• Policy owner must pay the charges first, and seek
reimbursement from the insurer for expenses incurred
under the plan by filing a claim.
1. Require the policy owner to share in the medical expenses

Expense Participation incurred. This encourages the insured person to keep the
medical expenses to a minimum, as well as helps to sieve out
small claims, which in turn, helps to reduce premiums
payable.
2. The three expense participation methods are :
1. Deductibles : a flat dollar amount of medical expenses

that is paid by insured, before the insurer will make any
payment under the policy.
3 Types of Deductibles :
• Per Annum deductible (least restrictive);
All the eligible expenses incurred by the insured person for
a variety of covered illness within a policy year will be used
to satisfy the deductible amount.

• Per Disability /Per Year deductible;

The deductible amount must be satisfied by eligible
medical expenses that are attributable to the same illness,
within the same policy year.
• Per Disability (or Per Claim) deductible.

Most restrictive- as the policy owner has to bear the
deductible each time that he makes a claim, regardless of
whether the claim is made within the same policy year.
Note :
• Know the eg in the text for calculating
deductibles and co- insurance at page 19, Eg 2.2
• The higher the deductible, the cheaper will be the

premium. Most insurers do not impose deductibles
on outpatient treatment.
• Deductible is applicable separately on each of the

family members insured under the policy. For eg : a
husband cannot combine his medical expenses with
his wife's medical expenses to satisfy the deductible
under the policy for the same year.
2. Co insurance: a specified percentage in excess of

deductibles.
3. Pro- ration factor : when insured is admitted to a ward

higher than the plan’s entitlement, a percentage is
applied on the actual charges incurred and covered
under the policy, hence benefit is reduced. In this way it
ensures fairness such that a policy owner who pays a
lower premium for a lower plan should be encouraged to
use the services available only on the selected plan.
Benefits limits Define :

Lifetime limit
Often set at a very high amount eg. S$1m. The maximum total
amount of all reimbursements that the insurer is liable to the
insured throughout insured’s lifetime.
Annual Limit
The maximum annual reimbursements by the insurer as stated
in the Benefit Schedule of the Policy.
Event Limit
Maximum amount payable in respect of any one disability or
illness as defined in the policy.

• Most Individual Expense Insurance Policies will

Geographical Limit automatically terminate if insured resides outside
Singapore for more than 180 days.
• Treatment overseas are based on reasonable and

customary charges.
Waiting Period Define waiting period: A period of time stated in the policy
which must pass before the coverage can begin. A waiting
period protects members within the portfolio, by ensuring
individuals are not able to make claims shortly after joining and
then cancelling their membership.
This plan is subject to a waiting period. However waiting period

does not apply to accidental injury.
Age limit Minimum: 15 days old.
Maximum: 75 years old.
Premium Age band basis.

i.e if the person crosses to the next age band, he has to pay a
higher premium, based on the new age band he falls under.
Premium rates are not guaranteed, may be adjusted due to

higher claims, medical inflation etc.
Guaranteed Renewability Insurer cannot terminate as long as insured pays the premium.
Exclusions & Limitations • to avoid policy owner receiving reimbursement twice;

for the same charges or making a profit;
• to make premium more affordable;
• to define more clearly the medical care and treatment;
• to avoid the policy owner selecting against the insurer (i.e
anti- selection)
Exclusions - refer to text pg 23 for the common exclusions.
Limitations Prevents the insured from making a profit. Total claims made
(Co- Ordination Of Benefit) by the policy owner will be equal to the total medical expense
incurred.

Underwriting Individual MEI

The main source of information for individual Medical Expense
Insurance is the proposal form.
Group MEI
For group coverage, employer is required to complete the
Group Fact Find form. For small group of less than 10
members, individual employees to complete health declaration
form.
Healthcare Subsidy • Citizens enjoy heavy subsidy in class B2 and C wards.

• PRs received significant subsidy.
• Foreigners – not subsided at all.
Termination of Cover Apply to both individual and group policies:

• death of the insured person;
• date on which insured enters full time military service
except during National Service reservist duty;
• end of policy eg (80 yrs old)
• policy is terminated;
• policy is expired;
• total claim amount reached lifetime limit.
Apply to group policies:

• date of cessation as an employee.
Claims Forms to be submitted to insurer are :

• Claims form to be completed by the insured;
• Physician's statement by the attending doctor;
• Original medical bills.
To claim under Integrated Shield Plan approved under

Medisave, all he needs to do is inform hospital of the name of
the insurer, fill a standard form and the hospital will claim on his
behalf for inpatient expenses, through MediClaim System.
Must notify insurer within a specified period ( e.g 90 days) after

incurring medical costs.

Chapter 3 – Group Medical Expense

1. What are the characteristics of Group Insurance?
 Master Contract - issued under a single contract kept by policy owner. For example,
under a company's Group Insurance Policy, the employer is the policy owner, while the
employees or any of their immediate family members (spouse and children) if included
are the insured persons.
 Minimum Underwriting – May need to fill up health declaration form, or waive all
underwriting requirements and rely on pre-existing condition exclusion clauses to
prevent anti-selection risks.
 Experience rating – underwritten based on past claims experience.
 Cost effectiveness – low cost due to savings in administrative costs in view that only
one group policy is issued.
 Plan Continuation – renewable on a yearly basis.
 Eligibility requirements – Requires an employee to be "actively at work" on the day

that insurance coverage take effect. If an employee is on sick or annual leave on the
day the insurance coverage takes effect, he will not be covered by the Group Policy until
he returns to work.
2. Ministry of Manpower requires every employer to purchase a minimum medical insurance

coverage for their foreign workers and domestic workers. The coverage must be at least
S$15,000 per year and covers medical bills incurred for inpatient care and day surgery,
including hospital bills for conditions that may not be work related.
3. Group Medical Expense Insurance policies are often purchased by employers as part of their
employee benefits to attract and retain their employees.
Group policies can also be extended to cover the employees’ immediate family members. For
example, after the employees have been confirmed, new dependents like spouse can be
included at any time within 30 days after marriage and child at any time between 15 and 30
days after birth.

4. Compulsory Vs Voluntary
Compulsory Voluntary
Characteristics All employees must be covered under No need for full participation (min-
the same plan, and premium has to be 75% participation). Employees pay
paid by the employer. part of the premium.
• Ease of administration since no Employer

payroll deductions to monitor; • Employees pay part of the cost;
Advantages
• Lower costs – less administrative • Generates interest &
work; appreciation;
Employees
• Employer retains greater control. • Employees have some form of
control over the plan;
• Lower premium than buying

individually.
5. Differences between Individual and Group Insurance.
Individual Insurance Group Insurance
Needs only be insurable to be Only members who belong to the

Eligibility
granted coverage. group and are actively at work
are covered.
Contract Each individual policy owner gets a One master contract is issued.
policy contract.
Insured members may or may
Each individual policy owner has the not have the choice to select the
Choice of Plan
right to select the coverage. coverage in a compulsory plan.
Group as a whole is evaluated

Individual health and financial status on gender and age distribution
Underwriting
are evaluated. of the group, occupation mix and
past claims experience.
Termination of Either individual or insurer chooses Coverage for him stops when he
Cover to terminate it. leaves the group.
Cost of coverage is lower.

Cost of coverage is higher.
Premium Premium is unit related.
Premium is age related.

6. Portable, Transferable Medical Benefits & Shield Plans for Employees

To incentivize employers to make the move towards enhancing the portability of inpatient or
hospitalization medical benefits for their employees, Singapore Government has revised the
tax policy to allow employers implementing any of the following portable medical benefits
options to enjoy higher tax deduction for medical expenses of up to 2% of total employees’
remuneration:
A. Portable Medical Benefits Scheme (PMBS);
B. Transferable Medical Insurance Scheme (TMIS);
C. Provision of a Shield Plan ; or
D. Ad-hoc Contributions to Employees' Medisave Accounts.
A. Portable Medical Benefits Scheme (PMBS)

1. This scheme rides on the Medisave/MediShield framework. Employer makes
monthly contribution to employees’ Medisave accounts that can be used to purchase
any one of the Medisave approved medical insurance policies to cover their
hospitalization needs, instead of providing Group Medical Insurance coverage.
2. Advantage is that the employee can continue to be covered even though he may be
unemployed or is in between jobs. Coverage continues as long as premium is paid
regardless of employment status.
3. The employer will enjoy a 2% of tax deduction. To be eligible for tax deduction, the
following conditions apply;
• Must cover at least 20% of the local employees;
• For full time employees, the additional monthly contributions to Medisave accounts
should be at least 1% of each employees’ gross monthly salary, subject to a min
of $16 per calendar year.
• For part-time employees, the additional monthly contributions to Medisave

accounts should be based on 1% of their gross salary for the calendar month.
However, for employers who choose not to implement either PMBS or TMIS, their tax
deductibility in respect of medical expenses will be maintained at 1% of total employees'
remuneration.
B. Transferable Medical Insurance Scheme (TMIS)

1. TMIS is a private hospitalization insurance arrangement among participating insurers. It
is to provide Medical Expense Insurance coverage to an employee, starting from the
date of leaving the service of his employer for whatever reasons up to a period of 12
months, as long as the insurance premium is paid.
2. TMIS is an enhancement of the existing employer sponsored Group Medical Expense

Insurance outside of the CPF Medisave framework. It is basically an employer-
sponsored Group Medical Insurance programme with the following 2 additional features:
• Continuation of coverage; and
• Transferability of benefits.

3. To qualify for TMIS, the employer must:

• have a group size of 11 or more employees;
• take up a group Medical Expense Insurance plan (MEI);
• insure at least 50% of its local employees, subject to a minimum total of 11
employees;
• pay 100% of the premium for the group Medical Expense Insurance coverage;
• not to give employees the option as to whether they wish to be insured under the
group MEI Plan.
3. How can the 2 features under TMIS benefit the employees?
Continuation Of Coverage Benefits Transferability of Benefits

(Previous Employer) (New Employer)
1. This feature enables an employee to 1. This feature enables an employee who

enjoy hospitalization coverage from resign from one employing company,
their termination of employment by his which holds a TMIS policy, and joins
employer, or his own accord up to a another, who also holds a TMIS policy
max period of 12 months (not to enjoy these benefits:
exceeding the prescribed statutory
age). a. automatic coverage under the new
employer’s group plan, without the
2. Claims for continuous benefits will be need to provide evidence of good
payable from the previous employer's health;
TMIS Plan.
b. Waiver of any exclusion on pre-
existing medical conditions if the
employee has been continuously
insured under a TMIS plan for 12
months whether with the prior
employer or new employer.
2. However, if the employee is hospitalized

for a pre-existing condition when he
joins the new employer within the first
12 months, he will enjoy a lower
benefit of either the new employer’s
TMIS plan or prior employer’s TMIS
plan. Refer to pg 41, eg 3.1 of text.
Note :
That transferability of benefits will not be
available, if the employee moves from an
employer with a non-TMIS group MEI Plan
to an employer with TMIS plan, and vice-
versa.
Claims for transferability of benefits will

be payable from the new employer's TMIS
Plan.

4. Medical Expenses that qualify under TMIS Special Benefits:

• Daily room and board charges;
• ICU charges;
• Charges for Miscellaneous hospital services;
• Charges for in-hospital doctor’s visits;
• Charges for inpatient and outpatient benefits.
5. All pre/post hospitalization outpatient, emergency outpatient accident and outpatient

kidney dialysis/cancer treatment are not eligible for TMIS benefits, even if they can be
reimbursed under the TMIS Plan.
6. To be eligible for the TMIS benefits, an employee must be:

• Below statutory retirement age (62 years from 1 Jan 2012). However, employers
are now required to offer re-employment to eligible employees who turn 62 years,
up to 65 years or 67 years, as may prescribed;
• Singaporean or PR based in Singapore;
• Working full time with the same employer;
• Working on a permanent employment contract or on a temporary contract, with a
term of 24 months or more.
7. To verify the eligibility of an employee under the TMIS, any employer has to issue a
Transferable Medical Insurance Certification (TMIC) at the request of an employee upon
termination of his employment. The TMIC must be submitted to the insurer when the
employee submits a claim for Continuation Benefit, or to the new employer’s insurer
should a claim arising from a pre existing condition be made within 12 months of joining
the new employer.
8. PMBS Versus TMIS
PMBS TMIS
Who purchases the Employees purchase policy on his Employer purchases the
Policy? own from the additional policy.
contributions made by his employer
to his Medisave account.
What type of medical Only a Medical Insurance policy Any Group Medical Expense
plan can be approved under the Medisave Policy, other than those
purchased? Scheme. (i.e an IP plan from an approved under the Medisave
approved insurer). Scheme.
Coverage Lifetime for most private Integrated Expires at statutory

Shield Plans. retirement age.
Coverage continues when the Coverage continues up to a

employee is between jobs or out of max of 12 months from the
job as long as premium is paid. date of termination of a job.
Deductibles and Co- Apply. However riders can be Unlikely to apply as Group
insurance purchased to offset them. MEI rarely have these
features.

Pre existing illness. Excluded Waiver on pre-existing

conditions where employees
change jobs and where both
employers provide TMIS
benefits.
Who have control Employees Employer

over the policy?
C. Provision of Medisave- Approved Shield Plan

1. Employer may choose to pay for a MediShield Life or an Integrated Shield Plan (IP) for
the employees. An employer providing employees with an IP can claim tax deduction
for medical expenses incurred, up to 2% of their total employees’ remuneration, if they
meet the following:
• Provide an IP for at least 20% of their local employees;
• Pay IP premiums on behalf of their employees directly to the approved insurer or

reimburse the premiums into their respective employees’ Medisave Accounts.
2. Tax deduction excludes premiums for "Riders on IPs" that cover deductibles and co-
insurance payments.
D. Ad-hoc Contributions to Employees' Medisave Accounts
1. An employer can make ad-hoc Medisave contributions to the employees' Medisave

Accounts, even if it is not adopting any of the portable medical benefits options.
2. To encourage such contributions, the employer can get an additional tax deduction
beyond the 1% limit for the amount of ad-hoc Medisave contributions made. The overall
tax deduction for medical expenses will be subject to the overall cap of 2%.
3. Such contributions are subject to a cap of S$1,500 per employee per year during the
relevant basis period. The employees can get a tax exemption of up to S$1,500 per
year for these additional Medisave contributions.

Chapter 4 – Disability Income Insurance

1. What is Disability Income Insurance?
• Often sold as income protection product as it helps to replace a portion of the
insured’s income that he loses if he becomes incapacitated and unable to work as a
result of as a result of accident or sickness.
• Known as Permanent Health Insurance because insurer cannot cancel the policy no
matter how many times the insured makes a claim. Policy will continue to pay until
insured returns to work, dies or policy ends whichever happens first.
• Also known as "Income Protection" Insurance or "Income Replacement" Insurance.
2. Differences between Disability Income Insurance and Total Permanent Disability

Benefit.
1. The main difference between Disability Income (DI) and Total Permanent Disability
(TPD) lies in the purpose:
• DI - provides income to the insured when he is unable to go to work.
• TPD - serves to accelerate death benefit under a Life policy.
2. Other differences between DI and TPD.
Criteria Disability Income Insurance Total and Permanent

Disability Benefit
Definition Relates to the extent the Defined to be total and

insured can fulfill the duties of permanent, such as loss of
his occupation. limbs or loss of eyesight.
Form Stand- alone policy or rider. Incorporated into Life Insurance

Policies.
Maximum Sum Assured Up to specified percentage Not pegged to salary.

of the salary.
Escalation and Partial Available Not available

Benefit
Deferred Period Available (can choose) Usually a 6-month waiting

period.
Available to who Working adults with earned No restriction on non

income salary. working people. E.g.children,
and housewives .

3. Computation of Disability Income Benefits

Based on example 4.1 from Text at page 51. Compute total amount received from the DI
Policy, given the following information:
Monthly Income: $5,000

Escalation Benefit: 5% per year
Effective Benefit Period: 30 Years
Answer
Monthly Benefit: $3,750 ($5,000 x 75%)
Yearly Benefit: $3,750 x 12 = $45,000
Total Benefit Payable: $45,000 x 66.4388 (table A1 – 5%;30 Yrs) = $2,989,746
4. Definitions of Total Disability

Since the purpose of DI Policy is to provide income when an insured is totally disabled
and unable to work. Hence the meaning of "Totally Disabled" is important and may take
one of the following forms:
1. Own Occupation
• Insured’s inability to perform the material duties of his own occupation.
2. Modified Own Occupation

• Insured’s inability to perform any gainful occupation or similar occupation for which he
is reasonably suited by reason of education, training or experience.
3. Any Occupation
• Insured’s inability to perform any occupation.(most restrictive)
4. Severe Disability
• Insured’s inability to perform at least 3 of the 6 ADLs – washing, dressing, feeding,
toileting, mobility, transferring (follows the definition of Long Term Care Insurance in
Chapter 5).
5. Partial Disability
• When the insured recovers from a total disability to perform some major duties of his
occupation, but at a salary which is at least 25% lower than the pre-disability salary.
6. Recurrent Disability (Linked Claims)

• In the event if the insured who has been receiving disability benefits under a DI
Policy, returns to work, but suffers a relapse within a certain period (usually 180
days), insurers will waive the deferred period and benefits payments will
recommence immediately. It is treated as a continuation of the earlier claim.

5. Benefit Period Versus Deferred/ Elimination Period

1. Benefit Period - The maximum period for which disability benefits are payable to the
insured for any one episode of disability.
2. Deferred Period - Policy will start paying the benefits after the insured has been disabled
for a specified period known as deferred, elimination period.
3. In short:
Benefit Period
The longer the benefit period, the higher the Premium.
Deferred Period(DP)
• The longer the deferred period, the cheaper the premium.
• Shortest(DP) - suitable for : Self Employed.
• Longest (DP) – suitable for : Financial Constraints.
6. Criteria For Payment of DI Insurance Benefit

To be eligible for payment, insured MUST:
a) keep the policy in force;
b) be working(employed) or in-between jobs when being disabled ;
c) still be disabled after the deferred period;
d) meet the definition of total or partial disability;
e) not have reached the expiry age;
f) not have resided outside Singapore for more than a certain period of time (usually not
more than 6 months); and
g) not have other sources of income (e.g payment from Work Injury Compensation
Insurance).
7. Types Of Benefits Offered

1. Total Disability Benefit
• Pays up to 75% of the insured average income prior to his disability.
• Not 100% payment so that the insured has incentive to go back to work.
• The benefit will cease when the insured recovers and returns to work, either full
time or part-time and even to a different occupation.
2. Partial Disability Benefit

• Also known as “Rehabilitative Benefit ”.
• It provides a reduced benefit if the insured is able to return to work at a reduced

income of 75% of his Pre-disability Earnings or lower. This reduced benefit is
based on this formula:
Pre-disability Earnings – Present Earnings X Total Disability Benefit
Pre-disability Earnings
Note : Please know the example 4.2 at page 57 of text
• Insurer will pay a pro-rata amount, if the period of the partial disability is less than a
month.

3. Rehabilitation Expense Benefit

1. Reimbursed an insured for rehabilitation costs incurred. Limited to a per disability
basis and include items such as:
• Training courses;
• Medical aids (e.g wheelchairs, walking frames, crutches); and
• Workplace modifications.
2. Insured must get the insurer's approval in writing. Rehabilitation benefit may be
payable in addition to the monthly disability benefit (e.g up to 3 times the monthly
benefit).
4. Escalation Benefit
1. Useful to hedge against inflation.
2. Note: Please know this example 4.3 at page 58 of text:

Compute escalation benefit, and partial disability benefit given the following:
Eddy was disabled on 30 June 2013 and he qualifies for a DI payment. He opted for
a 3% escalation benefit per annum and a 6 month deferred period. Insurer makes
first payment on 1.1.2014 for $6,000. (75% of his monthly salary of $8,000). He
found a job that pays him $2,000 a month on 1.2.2015.
QN : How much should insurer pays him on 1.1.2015?

Ans: $6,180 ($6,000+$6,000 x 3%) escalation benefit kicked in on the second year.
QN: How much should insurer pays him on1.2.2015?

Ans : $4,635
Partial disability calculated as:
$8,000 - $2,000 x $6,180
$8,000
Eddy will continues to receive the rehabilitation benefit until he dies or when the
benefit period expires, whichever is earlier.
8. Waiver Of Premium
• Premium would be waived during DI benefit payment period (applies to both total and
partial disability).
• For annual premium, waiver will come in at next Premium Due Date even though DI
payment has started. No refund of premium.
9. Death Benefit
A lump sum amount is paid to insured's dependants, in the event of the insured's death.

10. Limitation of Disability Clause

1. This clause is to ensure that the insured will not be better off financially by claiming and
its purpose is to prevent over-insuring by restricting the monthly benefit payable, so that
the total benefit (including other DI Policies that the insured may have) shall not exceed
the insured's pre-disability earnings or some proportion of it.
2. In the event of a claim, disability benefit payable will be reduced by income received
from Work Injury Compensation, any continuing salary or other income derived by
insured’s occupation. However benefits will not be reduced by payment from Total
Permanent Disability Benefit.
11. Features of a Disability Income Insurance Policy

• It can be issued as a standalone or as a rider to a basic Life Insurance plan.
• Provides a regular monthly income during insured's total and partial disability.
• Premiums waived during the benefit period.
• Choice of deferred and benefit period.
• Choice of escalation period.
• Level premium.
• Provision of rehabilitation expense benefit and death benefit.
• There is no restriction on the use of the cash benefits paid.
• Disability benefit may discontinue if the insured stays outside Singapore for a specified
period.
• There is no surrender value.
• No assignment is allowed.
• Cannot be written as a third party policy.
• The benefits are non-taxable.
• Policy will lapse if premium is not paid within the 30 day's grace period.
12. Underwriting
1. Underwriting Requirements
a. Individual (Salaried Employees)
Proposal form plus:
• Computerized payslip or
• Certified letter from company, on company’s letterhead, or ;
• Notice of Assessment;
• CPF Statement (6 months);and large amount questionnaire ( if annual
benefit is more than e.g $60,000); and
• Medical test report based on age and amount of DI benefit proposed.
b. Self Employed Person

Proposal form plus:
• Notice of Assessment for the last 3 years, or
• Audited company’s account for the last 3 yrs and large amount
questionnaire ( if annual benefit is more than e.g $60,000);
• Medical test report based on age and amount of disability benefit
proposed.

2. Underwriting Considerations
1. Occupation
To measure :
• Higher risk of disability from accident or sickness.
• Degree of incapacity to return to work. Insurers have a rating structure

depending on the class of occupation. e.g Class I, deskbound job to decline
(uninsurable). Some insurers may issue this policy only for white collar
occupations. Many insurers will not grant coverage to those hazardous jobs.
• It is a key requirement that the insured should inform the insurer in writing of any
change in his occupation. The insurer reserves the right to impose a loading,
reduce the benefit, or to exclude any claim arising as a result of insured's new
occupation, especially if it is more hazardous than the previous one.
2. Benefit Amount
To assess benefits proposed are reasonable based on the type of occupation and
stated earnings.
3. Benefit Period
The duration that the insurer needs to pay out the benefits. Underwriters may use
this to determine the terms of acceptance.
4. Deferred / Elimination Period

Deferred period chosen helps the underwriter to determine whether there is any
moral hazard involved. A shorter deferred period has a higher element of moral
hazard.
13. Differences between Cessation of Benefits and Termination of Cover.
Cessation of Benefits Termination of Cover
 Insured is fit to return to work;  Policy reached expiry date;
 When death occurs;  Premium is not paid within grace period;
 Benefit period has expired.  Insured dies or reached the expiry age;
 Resides outside Spore for an aggregate of

more than a specified no. of days (eg 300
days) within a policy year without seeking
the insurer's prior approval for continuation
of cover.
 Insured is not employed in a full time

occupation or profession for a continuous
period of a specified number of days (except
if he is disabled).

14. Group Disability Income Insurance

1. Usually purchased by the employer as an employee benefit for its employees. It can be
issued as a Standalone or Rider.
2. Insurers will only issue a Group DI Policy if the employer has a Group Term Life
Insurance Policy with them, or they may also issue it as a rider to a Group Term Life
Insurance Policy.
15. Disability Income Claims

1. Claims procedures for individual or group disability income are similar. Insured must
notify insurer within a specified period of time (e.g 60 days) from the date of
commencement of disability.
2. Documents insurer ask for includes:

• Claim form (personal particulars, details of his occupation and disability);
• Claimant's statement;
• Clinical Abstract form;
• Physician’s statement;
• NRIC/ birth certificate;
• Evidence of earnings;
• Letter from company certifying that the insured’s services has been terminated;
• Medical certificates;
• Laboratory tests results;
• Police report if disability is due to accident; and
• Incident report (if incident occurs at the workplace).
16. Foreign Residency During Claims Period

1. If the insured resides outside of Singapore while the benefits are payable, the following
conditions apply:
a) Insurer must be notified of the change in residence within 30 days of change.
b) Insurer must approve the new country of residence.
c) Insurer has determined that the evidence, which can be submitted to make a
claim under the policy from the new country of residence, is of similar (or better)
standard, in terms of quality and reliability, as compared to that which would be
available if the insured were to remain in Singapore.
d) Insurer has determined that the expertise and facilities for the care, treatment
and rehabilitation of the insured in the new country of residence, are similar (or
better) standard, as compared to those which would be available in Singapore.
e) Insurer reserves the right to require an independent examination of the insured

by its preferred doctor as and when reasonable.
2. If any of these conditions are not satisfied, insurer reserves the right to suspend the
benefits payable, until such time the insured returns to Singapore and the insurer
receives satisfactory evidence to resume payment of benefits.

Chapter 5 – Long Term Care Insurance

1. What is Long Term Care (LTC) Insurance?
1. Objective of Long Term Care Insurance (LTCI) is to meet costs of care to a person who
as a result of accident, sickness is physically impaired and unable to function
independently. They need assistance to perform the most basic activities of daily
living (ADLs). It pays in addition to other insurance policies, eg MediShield Life,
Hospital Income and Critical Illness Insurance Policy.
2. Although this product is meant for the elderly, the young should buy for 2 reasons:
• Cheaper Premium;
• Higher chance of being accepted.
2. Benefits Offered Under LTC Insurance
Benefits of LTCI
Daily Basis Monthly Basis
a) Service-Based b) Disability Based

Pays for a benefit • Pays a benefit • By far the most common
when an insured when an insured type of LTC Plan found in
incurs costs for a meets the benefit Singapore;
service covered (e.g trigger,
home care or nursing regardless of • Pay 100% of LTCI
care) and satisfies the service use. monthly benefit if unable
benefit trigger. to perform 4 out of 6
• Benefit Trigger - ADLs;
2 Types may be based on
1) Expense Incurred limitations in • Pay 50% of LTCI
Insurer will reimburse ADLs and /or monthly benefit if
for cost incurred in degree of unable to perform 2
using one of the cognitive out of 6 ADLs;
services covered, up to impairment.
the covered amount. (e.g advanced
dementia including
2) Indemnity Method Alzheimer's
Pays the covered disease).
amount, regardless
of the actual cost of
services received.

3. Eligibility Criteria for Payment of LTC Benefits

1. Insured need not be hospitalized to be eligible for LTC benefits. He can use the benefits
he received under his LTC to pay for the costs of engaging a maid or to pay for the costs
of staying in a nursing home. However, he must meet the following criteria:
1. Inability To Perform Activities of Daily Living:

 Washing / Bathing
The ability to wash in the bath or shower (including getting into and out of the bath or
shower) or wash by other means.
 Dressing
Ability to put on, take off, secure and unfasten all garments, any braces, artificial
limbs, or surgical or medical appliances.
 Feeding
Ability to feed oneself once the food has been prepared and made available.
 Toileting/Continence
Ability to use the lavatory or otherwise manage bowel and bladder functions through
the use of diapers and urinary catheters if appropriate.
 Mobility;
Ability to move indoors from room to room on level surfaces.
 Transferring
Ability to move from a bed to an upright chair or wheelchair vice versa.
2. Advanced Dementia
Advanced Dementia, or dementia arising from Alzheimer’s disease is covered. The
important issues are that dementia must arise from an organic reason and that the
insured requires continual supervision.
3. Meets The Deferred Period

Most insurers have a Deferred Period of 90 days commencing from the first day of
any continuous period of inability to perform ADLs. This is to ensure that short term
claims are avoided and therefore, reduce the premium costs.
4. Does Not Cover Pre-Existing Conditions

Does not cover pre- existing illness that was not disclosed in the proposal form. If
disclosed, insurer may reject the application or accept the application:
• at standard premium rates;
• at substandard premium rates (higher premium);
• accept the application with exclusions;
• reject the application.

4. Other Benefits Payable Under LTC Insurance
 Death Benefit
Small death cover ranging from an amount of $5,000 to 6 times the LTC monthly
benefit;
 Hospital Room and Board Benefit
 Surgical Procedure Benefit
 Financial Assistance with Adaptation Benefit;

A specified sum, such as 2 times the monthly benefit, is payable if the use of assistive
devices is deemed necessary (eg wheelchair) by a doctor so as to assist the insured to
perform an ADL.
 Extended Care Benefit

An extra specified sum, such as extra monthly benefit, is payable every 3 to 5 years;
 Rehabilitation Benefit
A reduced benefit (e.g 50% of the insured amount) when the insured makes partial
recovery (such as if he is unable to do 2 instead of 3 ADLs).
5. Features of LTC Insurance
a) Offered on a stand-alone basis or as a rider to a plan.

b) There is a minimum and maximum age entry.
c) It is issued on a guaranteed renewable basis.
d) There is no cash value or paid up value (with exception of ElderShield which has a
paid-up value) at any time.
e) Policy is non-participating and does not share in the divisible surplus of the insurer.
f) Premiums are level and usually not guaranteed for the policy period and can be adjusted
by the insurer.
g) Policy expires or terminate if premiums are not paid after the grace period, or maximum
benefit limit is reached.
h) If insured recovers from his disability, payments will stop. However, the insured can
choose to continue his policy by continuing to pay the premiums, provided he has not
reached maximum limit under his policy.
6. Exclusions
Among the exclusions given in the text at page 77, please know the following:
 All pre-existing illness;
 Self inflicted injury;
 Alcoholism or drug abuse;
 Acquired Immune Deficiency Syndrome (AIDS) or infection by any human

immunodeficiency virus (HIV), except where the infection is due to blood transfusion or
resulting from infection incurred by medical staff after the issue date;
 Participation in a felony, riot or insurrection.

Chapter 6 – Other Types of Health Insurance

This chapter covers the following health insurance products:
1. Critical Illness (CI) Insurance;

2. Hospital Cash (Income) Insurance;
3. Medical Expense Benefits Under Travel Insurance;
4. Group Dental Care Insurance.
1. Critical Illness (CI) Insurance

• It is a hybrid of life and health insurance;
• Also known Dread Disease;
• Provides a lump sum benefit upon diagnosis of any one of the critical illness;
• Can be sold as a stand-alone policy (individual or group) or as a rider to other policy;
• Before 1 August 2014, CI Insurance Policies cover only a maximum of 30 out of 37 critical
illnesses. From 1 August 2014, CI benefits offered under new individual or group
insurance policies may be updated and introduced with the following 2 changes:
a) revised standardised definitions of the 37 severe critical illnesses for insurers to

provide consistency for policyholders. (appendix 6a - the list of 37 CI).
b) flexibility for more medical conditions to be covered. Insurers not only can offer CI
Insurance Policies covering beyond 37 (30 previously), but also offer single-illness
CI Plans. Definitions for additional CI not covered by the 37 standardised definitions
will be set by individual insurers.
• CI using the old definitions will no longer be sold from 15 Feb 2015.
2. Eligibility Criteria For Payment Of Critical Illness Benefit.
a. Policy must be in force;
b. Life insured has not reached expiry age of Critical Illness Cover;
c. Critical Illness must be one that is covered;
d. Critical Illness must meet the definition in the policy;

The definition of critical illnesses as specified in the policy, forms an important part of the
policy, as they will determine whether a claim is payable. Important to explain to
prospective client, to ensure he understands the benefits will be paid only if the disease
qualifies and meets the definitions as specified in the policy.
e. Critical illness must meet conditions set down by insurer. The diagnosis of the CI must
be made by registered medical practitioners, which excludes physicians who are
themselves (life insureds), their spouses and other lineal relatives of theirs;
f. Must meet the waiting period of 90 days from the date of issue or reinstatement of the
policy. The waiting period is imposed to prevent consumers from buying the policy only

when they suspect that there is something wrong with their health. This is to prevent
anti- selection.
g. Insured must survive a period before the critical illness benefit becomes payable. This
survival period is usually 30 days, (although can be as short as 7 days) from date of
occurrence of a critical illness. It applies to Additional Type of CI cover only.
3. Features Of CI Insurance
Among the features of Critical Illness Insurance (CI) given in the text at page 84, please know
the following:
 Some insurers impose a limit on the total amount of sum assured (e.g S$1,000,000) that
a policy owner can buy. This is to minimize the risk of moral hazard.
 Premium is level and non guaranteed.
 Can be packaged or attached to a Life, Endowment or Investment Linked Policy.
 Can be issued as a stand-alone basis or as a rider to a basic policy. It does not pay
upon the life insured’s death or total and permanent disability.
 CI rider has no cash value;
 CI rider is automatically terminated once the basic policy is surrendered or converted

into an extended term policy;
 Packaged CI Policy which accumulates cash value (e.g whole life type of CI Policy) also
provides non forfeiture options. However, CI cover may be terminated once any non
forfeiture option is exercised except Paid Up Option.
 Stand –alone Term CI Policy does not acquire cash value, and thus has no non forfeiture
option;
 Assignment may/may not be allowed.
 Maximum age entry (eg 60 years) and minimum age entry (eg 1 year). For young lives,
it may be subject to a lien.
 There is a minimum (eg $10,000) and maximum (eg $1,000,000) sum assured
restriction.
 Cover will expire at age (e.g 75 years), or a whole life cover may be provided.

4. Types of CI Insurance Covers

1. Acceleration Benefit;
2. Additional Benefit
3. Severity-based CI Insurance Plan
4. Multiple Pay CI Insurance Plan
1. Acceleration Benefit Critical Illness (CI) Cover .

This type of CI insurance cover can be issued as a packaged policy or rider. It
provides for the pre-payment of a portion (e.g 50%) or the full sum assured (i.e 100%) of
the basic policy to which it is packaged or attached. For example :
S$200,000 Whole Life type of CI Policy with 50%

acceleration benefit.
Policy owner has the flexibility of choosing the

percentage of acceleration.
Scenario 1 Scenario 2
Death/ TPD Critical Illness
Payment of : Payment of:

• S$200,000 (death in lump sum) or • S$100,000 (50% of SA)
• S$200,000 (TPD in installments basis)

Upon Death/ TPD
Payment of balance Sum

Assured
• S$100,000
Note :
• If the person has chosen a 100% (instead of 50%) Acceleration Benefit in the
above example, the full sum assured plus bonuses (if any) will be paid, regardless
of whether he contracts a critical illness, dies or suffers a TPD.
• Policy owners who opt for less than 100% of acceleration, should attached a
Critical Illness Waiver of Premium Rider so that the future premiums on the
balance sum assured will be waived.
• The cover for this type of CI Policy may be up to age of 100 years, or depending
on the type of life policy to which is packaged/attached.
• Depending on what type of policy CI cover is attached to, if the basic policy has no
cash value (eg term policy), then there is no non-forfeiture option under the policy
to keep it in force, unlike Whole Life or Endowment Policy which has acquired cash
value, the insurer can make use of automatic premium loan to keep the policy in
force should policy owner defaults in premium payments.

2. Additional Benefit Critical Illness (CI) Cover.

This type of cover is available on a stand-alone basis or as a rider.
• On a stand-alone basis, the sum assured will be paid upon the diagnosis of a
covered CI, and the policy will be terminated.
• As a rider, it pays an amount in addition to the sum assured of the basic policy to
which it is attached. For example :
Whole Life Policy : S$100,000

Add on Critical Illness Rider: S$200,000
Scenario 1 Scenario 2
Death/ TPD Critical Illness
Payment of: Payment of CI Rider

• S$100,000 (death in lump sum) or • S$200,000
• S$100,000 (TPD in installments
basis)
Upon Death/ TPD
Payment of Whole Life

Policy
• S$100,000
Note :
• From the example above, the payment of the CI Insurance benefit does not affect
that of the basic sum assured. In summary:
• If he contracts a CI, followed by death = Insurer pays : $300,000.
• If he does not contract any CI, then upon death/TPD = Insurer pays : $100,000.
• This rider pays in addition to the sum assured of the basic policy it is attached.
• The term of this rider can be shorter, but not longer than that of the basic policy.
Usually expires at the age of 65 years. The sum assured of the rider can be
higher than the basic policy (e.g 5 times that of basic sum assured).
• Policy owners should attached a Critical Illness Waiver of Premium Rider so

that they need not worry about the premium payments for the basic policies to
which CI rider is attached to.
Please know the table at page 89 of text comparing these 2 types of CI covers.

3. Severity-based Critical Illness Insurance Plan

• Pays claims during the early stages and less severe critical illness. Benefits are
claimable at different stages of the illness, from early to intermediate to advanced
and terminal. Depending on the stages and severity of CI, it pays a percentage of
the sum assured as a lump sum payout to the policy owner. The progressive lump
sum payment, subject to a monetary cap of each severity level, pays up to the total
sum assured.
• Offered as a term plan or a rider to an existing Life Insurance Policy;
• Offered from age 1 to age 75;
• Premium is higher than normal CI plan.
4. Multiple Pay Critical Illness Plan

Allows more than one critical illness claim on the policy. A second or even third claim
is allowed if the medical condition deteriorates or if a different medical condition occurs.
Waiting period of the second and subsequent claims is usually waived.
Eg: Total payouts of up to 200 per cent of sum assured. So if the sum assured is
$100,000, the plan can pay up to $200,000. The payout depends on the severity level of
the CI as specified. (e.g 25% can be paid out at the early stage of CI).
5. Termination Of Cover
• valid CI claim has been made;
• basic life policy to which it is packaged matures or CI rider expires;
• non-payment of premiums, insured dies;
• policy is converted into Extended Term Insurance Policy.
6. Claims
In the event of a claim, insured must submit:
• Claimant Statement - completed by insured;
• Attending Physician’s Report;
• Proof of Critical Illness, e.g histology report, biopsy report, etc furnished at the
expense of the claimant.
• Written notice of claim must be submitted within (usually 60 days) of the diagnosis of CI
or performance of surgery as covered under the policy;
• Claimant’s form must be submitted (e.g 15 days) from the date the insurer sent it out;
• Proof of CI must be submitted within a specified period (usually 60 days) from the date of
diagnosis of CI.
7. Group Critical Illness Policy

• Can be issued as a packaged policy or as a rider.
• Will expire at age (e.g 75) specified in the CI Insurance cover, regardless of whether it is
issued as an Acceleration or Additional Benefit type of CI cover.

2. Hospital Cash (Income) Insurance
1. Pays a daily benefit upon hospitalization regardless of whether it is due to injury or illness.
The daily benefit is a fixed amount (e.g $100) chosen by the insured at the time of
inception of the policy. This amount has no direct co- relation to the actual amount of
medical fees incurred. This benefit can be issued to cover hospitalization resulting from
injury only or illness. However for illness, a waiting period of 30 days from issue/
reinstatement date applies. Waiting period does not apply to injury.
2. Features of Hospital Cash :

• Pays daily (eg $100 chosen by the insured).
• Limited by specified no. of days per hospitalization (e,g 180 days per hospitalization).
• Limited by a lifetime limit (e.g 1,000 days).
• It pays on top of other benefits received from medical insurances.
• Covers expires at a specified age (e.g 65, 70 or 75 years).
• Must be confined in hospital for at least 6 to 24 hours.
• Premium is on age band basis.
• It is yearly renewable.
• There is a “No Claim Discount” given for policy that is in force for a consecutive
period of insurance and free of any claim. A certain percentage (eg 25%) will be
deducted from the next renewal premium, subject to conditions as imposed by the
insurer.
3. Types of Hospital Cash Insurance

1. Hospital Cash Insurance when issued as a Standalone Policy is more attractive. It
includes:
a) payment of 150% of the daily benefit if the insured stays in a High Dependency
Unit (HDU) or Coronary Care Unit (CCU) of a hospital;
b) double or triple payment if the insured stays in the Intensive Care Unit (ICU) of a
hospital;
c) triple payment if hospitalization is due to accident, or if the insured is hospitalized
overseas;
d) get-well benefit;
e) rehabilitation income;
f) free accidental death benefit; and
g) involuntary loss of employment benefit (in excess of 30 days) - waiver of
premium (up to 6 months).
2. When issued as a rider attached to a basic policy, such as Life Insurance Policy, the
rider usually expires when the insured reaches a specified age (e.g 65, 70 or 75
years) or on the maturity of the policy, whichever is earlier.

4. Underwriting
Hospital Cash Policy is usually not underwritten due to its small premium, however pre-
existing medical conditions are permanently excluded under the policy.
5. Termination Of Cover
Cover will terminate when one of the following event occurs:
a) the premium is not paid at the end of grace period;
b) the insured reaches the expiry age as stated in the policy;
c) the per lifetime limit is reached;
d) the basic policy lapses or matures; or
e) the insured dies.
6. Claims
Require to submit the following:
• Claim form;
• Hospital discharge summary bills;
Additional documentary evidence:

• Attending Physician’s Report;
• Other relevant supporting documents.

3. Medical Expense Benefits Under Travel Insurance
1. The benefits offered by a Travel Insurance Policy include:
A. Medical Expenses and Other Related Benefits

B. Hospital Confinement Allowance;
C. Emergency Medical Evacuation; and
D. Repatriation.
A. Medical Expenses and Other Related Benefits

Reimburse most of the overseas medical and treatment necessarily & reasonably
incurred by the insured person for sustaining injury or sickness (as defined in the policy)
as follows:
• Medical expenses such as clinical, hospital, surgical, nursing, ambulance and
medical supply charges, emergency accidental and miscarriage expenses, including
any follow –up medical expenses in Singapore incurred within a certain period
(usually 30 days) after the insured returns from his trip.
• Expenses incurred for treatment by Traditional Chinese Medicine physician,

including acupuncturist, bonesetter, chiropractor, herbalist or physiotherapist, up to a
limit (e.g S$750)
The above is subject to an overall limit of indemnity (e.g S$2,000,000).

Lower limit will apply to a child (from one to 18 years) or elderly (above age of 70 years).
• Reasonable additional accommodation and travelling expenses incurred by

insured person (and a travel companion if required) to remain in the overseas
country of visit for medical treatment, up to a limit (e.g $25,000) and
• Hospital visit – reasonable travel and accommodation expenses necessarily

incurred by one relative or friend of the insured who has been hospitalized overseas
for more than 5 days for example, to visit and stay with him until he is medically fit to
return home, up to a limit (e.g S$10,000).
B. Hospital Confinement Allowance

1. This entitled the insured to claim if he is hospitalized abroad for:
• A daily cash payment (e.g S$200 per day);
• Up to a certain period (e.g 100 days) or
• Up to a certain amount (e.g S$20,000)
The benefits are payable in addition to any other medical expenses which he has
claimed and they are payable upon his return to Singapore, when he submits a
claim with all relevant supporting documents.
2. For hospitalization in Singapore when treatment is sought within a certain period (e.g
7 days) upon return, the limits are lower (e.g S$100 per day payable up to 10 days).
3. Double benefit for overseas hospitalization in an intensive care unit resulting from an
accident up a certain period (e.g 10 days).

C. Emergency Medical Evacuation

1. Emergency evacuation means that, in the event of a critical situation in which the
insured person suffers a serious illness or injury abroad, and has to be evacuated to
another place to seek emergency treatment, because local medical services are
inadequate or unavailable.
2. The insurer contracts specialist company to provide emergency medical evacuation.

It is a requirement in the policy that the insured must contact a specialist company
contracted by the insurer to provide emergency medical evacuation. Such specialist
company shall then decide whether or not the insured requires emergency
evacuation. A 24 hr multilingual hotline phone number of such specialist company is
specified in the policy.
3. There is usually a maximum benefit limit (e.g S$500,000) payable for the lower
coverage plan. However for the higher coverage plan, the coverage amount is
usually unlimited.
4. It gives peace of mind to the insured person if he suffers a serious illness or injury in
an unfamiliar environment, knowing that help is just a phone call away.
D. Repatriation
1. Emergency medical repatriation occurs when, as a result of an unfortunate illness or
accident abroad, the insured has to be repatriated to his country of origin (e.g return
to Singapore). The decision as to whether he should be repatriated strictly rests with
the attending medical doctor or the insurer’s contracted specialist company.
2. Repatriation of remains means the transportation of and return of the deceased

insured’s mortal remains to his country of origin.
3. There is usually a maximum benefit limit (e.g S$30,000) payable for the lower
coverage plan. However for the higher coverage plan, the coverage amount is
usually unlimited
2. Exclusions
Among the exclusions given in the text at page 99, please know the following:
• war, invasion, hostilities, warlike operations, (whether war be declared or not ), civil
war, mutiny, rebellion, revolution, or usurped power;
• pregnancy or childbirth or any sickness associated with pregnancy or childbirth;
• driving or riding, in any kind of race, engaging in any professional sport, ice or winter
sport, mountaineering requiring the use of guides or underwater activity involving use
of underwater breathing apparatus;
• aerial activity other than a fare-paying passenger in a licensed passenger-
carrying aircraft;
• any event including strike, riot, civil commotion, health threatening situation,
natural disaster published by the mass media or through advisory of the
authority, unless the policy already issued or the trip already commenced
before the date of publication or advisory;
• travel booked against medical advice or for the purpose of obtaining or
seeking any medical care treatment abroad.

4. Group Dental Care
1. Group Dental Care:
• Offered on a group basis without underwriting.
• It can be a rider attached to a Group Hospital & Surgical or as a Standalone policy.
• Coverage is usually on a 24 hrs worldwide basis, only employees who are actively
at work are covered and it is usually on a non contributory basis.
• Coverage is worldwide & the policy is usually issued for a period of 2 years and
thereafter renew every one or two years, depending on the insurer.
• Pre-existing dental conditions are covered as well.
• Affected by the Limitation Clause, hence reimbursement will be affected by

workmen’s compensation or other dental plans.
2. Exclusions:
a) Dental procedures that are not specified in the schedule of allowances;
b) Hospital charges;
c) Injuries arising from war (declared or undeclared), revolution, or any warlike
operation;
d) Medicine given;
e) Treatment which is purely cosmetic in nature;
f) Treatment resulting from self –inflicted injury, while sane or insane and
g) Replacement of broken, lost or stolen dentures.
3. Terminations:
a) The date of termination of the insured employee’s active full time employment;
b) The date of termination of the policy;
c) The date of expiration of the period for which the last premium payment is made in
respect of the insured employee’s cover;
d) The date on which the insured employee enters full time military, naval, air or police
service, except during peacetime National Service reservist duty or training;
e) The date of expiration of the period within which the insured employee reaches a
specified age (usually age of 65 years).
4. Claims
1. Insured employees can visit their own dentists or use insurers' panel of dentists. For
employee who uses his own dentist, they need to pay first and file a claim with the
insurer. Documents are:
• Completed claim forms

• Original receipt & itemized bills.
2. For insurer that has its panel of dentist, employee need only produce the
membership card whenever he visits the dentist and the clinic will bill insurer
directly, and the employee need not pay a single cent nor file any claim with the
insurer.

Chapter 7 – Managed Health Care (MHC)

1.
Managed Health Care (MHC)
Purpose
An overall strategy for containing medical care costs, while receiving appropriate medical
care. It will pay for most of the medical bills when an individual sees a General
Practitioner, specialist or receive treatment in a hospital.
3 components to contain and control healthcare

expenditure
Accessibility Cost - 4 methods used by Quality of care.

• Members are referred to a MHCO to control cost:
selected network of • Capitation; Health care providers
healthcare providers. Out Capitation means MHCO must possess requisite
of which, they may be prepays their providers a fixed skills, training and
required to receive all his amount for each member’s licenses. MHCO is as
healthcare services from a medical care on a monthly much concerned about
particular provider within basis, regardless of how often the quality of care
the network. member receives medical delivered, as well as
attention. cost control, for a good
• Requires members to reputation is what
select one doctor to be • Discounted-Fee For- Service attracts new members
their Primary Care (e.g discount of 10% on and keep existing ones.
Physician (PCP). physician fees)
• Salary
pays a fixed salary, bonuses,
A Primary Care Physician(PCP) incentive payments.
is usually a general practitioner.
He is often known as: • Fee Schedule
MHCO will pay no more than
 Personal Physician the specified maximum fee
Serves the member as his allowed for each procedure.
“personal physician”, but
also acts as the first contact
with MHC.
 Gatekeeper Qn:
Member must obtain a Which of the above payment methods used do not
referral from the PCP discourage the provision of unnecessary medical
before seeing a specialist, services?
within the network, hence
called "gatekeepers”. Answer: Discounted-Fee-For-Service &
Fee Schedule

2. The three common types of MHC Plans are:
Managed Healthcare Plans
A. B. C.
Health Maintenance Preferred Provider Point of Service
Organisation (HMO) Organisation (PPO) Plan (POS)
1. Staff Model 2. Group 3. Network 4. IPA 5. Mixed

HMO Model HMO Model HMO Model HMO Model HMO
A. Health Maintenance Organisation (HMO)

1. Members under HMO will need to receive most or all of his healthcare from a network
provider. HMO requires that the member chooses a Primary Care Physician (PCP) who
is responsible for managing and co-coordinating all of his healthcare.
2. If the member needs care from a specialist in the network, or a diagnostic service such as
X-ray, the PCP will have to provide a referral. If member does not have a referral, or
chooses to go to a doctor outside of his health plan's network, he will have to pay all or
most of the costs, unless it was pre-authorized by the HMO or deem as emergency.
3. The HMO is the most restrictive type of healthcare plan, because member has the least
choice in selecting his healthcare provider.
4. There are four basic types of HMO as follows:
1. Staff Model HMO

• HMO employs healthcare providers who usually work together in a centre to
treat members who are only members of the HMO. Specialist care are
provided by referring their patients to certain contracted specialist.
• Very effective in managing costs as HMO has control over the physicians they
employ. Compensates physicians on a regular salary, regardless of the number
of services that they provide, hence physicians have no financial incentive to
over treat the patients.

2. Group Model HMO

• In a Group Model HMO, the doctors and healthcare providers are not hired
directly. It contracts with a large group medical practice to provide medical
care services to its members and pays the group in bulk. The physicians decide
within the group how the money is distributed.
• The group in turn is responsible for:

• obtaining the physicians necessary to provide the contracted services;
• compensating its physicians;
• providing facilities in which its physicians will perform the contracted

services; and
• arranging to provide hospital services.
• As with the Staff Model HMO, the physicians only see patients that signed up for
the HMO that contracted them and has the same effectiveness at managing cost.
3. Network Model HMO

• Similar to Group Model HMO, except that in this model, it contracts with a
relatively large number of group practices and even individual physicians,
so that they can offer a comprehensive range of medical care services to their
members.
• Physicians operate out of their own offices or facilities provided to them by their
group practice. This model may not necessarily obtain all their patients from a
particular HMO. It may contract to provide services to more than one HMO.
They may also belong to one or more PPO networks or may treat other walk-in
private patients . For this reason and because HMO arranges for hospital
services rather than physicians, this model does not have as tight control over
utilization management as the above 2 models.
4. Independent Practitioners Association (IPA) Model HMO

• HMO contracts an independent practice association that works similarly to a
multi-speciality physican group practice, except its members are allowed to treat
non-HMO patients.
• Under this model, the PCPs are allowed to refer employees to medical services
outside the network. However, coverage may be reduced.
5. Mixed Model HMO

• This model is a combination of 2 or more of the above 4 traditional HMOs.
• They are common nowadays because they offer broader consumer choice of
physicians and clinical settings.

B. Preferred Provider Organisations (PPOs)
1. Similarity between HMO and PPO

PPOs are similar to HMO in that they have negotiated contracts with a network of
preferred providers from which a member can choose.
2. Differences between HMO and PPO

1. Unlike HMO, a member does not have to select a PCP and does not need
referrals to see other providers in the network. However, to encourage the use of
network providers and /or get a referral for a specialist, PPO offers "richer
benefits" to members as incentives. For non network providers, medical costs
is higher.
2. PPOs are less restrictive than HMO in the choice of healthcare providers.
However they tend to require greater “out of pocket” payments from members.
C. Point-of- Service (POS) Plan

• Combination of a HMO and a PPO.
• Encourage, but does not require a member to choose a PCP.
• Allows members to use a provider who is not in the network for his care, however he
has to pay higher co-payments and/or deductibles than member who uses a PCP.
• Known as point-of –service plan because, at the point when a member needs
healthcare services, he can decide to stay in the network (to allow his PCP to
manage his care service) or go outside of the network on his own, without a referral
from his PCP.

3. Degree of Choice of Providers Versus Degree of Cost Control
Traditional Medical Expense Insurance (highest premium)
PPO
Degree of choice of providers
POS
IPA HMO
Network Model HMO
Group Model HMO
Staff Model HMO

(lowest premium)
Cost Control
3a. In ascending order, list the models given below from the most cost effective to the least
cost ineffective:
POS, Network Model HMO, IPA, Staff Model HMO, PPO
Answer: Staff Model HMO/Network Model HMO/IPA/POS/PPO
3b. In descending order, list the given models in question 3a from most flexibility to least flexible.
Answer: PPO/POS/IPA/Network Model HMO/Staff Model HMO

4. Benefits offered include:

• Primary care - provided by general physicians.
• Specialist care - provided by specialists from different medical specialties.
• Hospital care - reimbursements for hospital & surgical expenses.
• Emergency care - provides 24-hrs cover for accident & emergency.
• Preventive care- provides talks, seminars to keep members free from diseases.
5. Like other types of traditional Health Insurance, elements of co-insurance and deductible may
be found in MHC Insurance.
6. One exclusion under MHC Insurance Policy states that payment from MHC plans will be
excluded by reimbursements from Workmen Compensation and other forms of insurance
coverage.
7. Claims for MHC
In- the- network providers Out-of-network providers
Members who use in-the-network providers Members who use out-of-network providers
need not file claims with the insurer. need to file claims with the MHCO.
Supporting documents to be submitted
include:
• Claimant’s statement; and
• Original itemized medical bill.

Chapter 8 – Healthcare Financing

1. Singapore Healthcare Philosophy
1. Singapore offers universal healthcare coverage to its citizens, with a financing system
anchored on individual and collective responsibility, and affordable healthcare for all.
2. Singapore's financing healthcare philosophy is based on:

(a) Affordability and Accessibility of Basic Healthcare
• Heavy subsidies for basic services (primary, acute and step down care).
(b) Individual and Collective Responsibility

• Individual medical savings account;
• Co-payment by individuals; and
• Risk-pooling for catastrophic illnesses and for serious long-term disability.
2. Government Subsidies
1. Government Subsidies include the following:
Government Subsidies
In Public Hospitals
Specialist Outpatient Clinics
Inpatient Other services
(SOCs)
• Ward classes differ only in • Subsidy for lower-to-middle • Day surgery and
the physical amenities and income is 70% & 60% Accident &
level of comfort, however the respectively, while the rest of Emergency (A&E)
standard of medical care is the subsidized patient is services are not
the same regardless of the 50%. means- tested.
ward's class.
• For standard drugs:
• In Jan 2009, means testing Lower-to middle-income
in public hospitals was receives a 75% subsidy;
introduced to better target while the rest of the
the heavy subsidies for subsidized patient is 50%.
class B2 & C wards at the
lower-income group. The • The eligibility for higher
subsidy received depends on subsidy is based on the
the monthly income of the household monthly income
patient. B2 or C class per person, or annual
patients who require follow- value of residence (for
up at the specialist households with no
Outpatient Clinic (SOCs) will income) and is aligned with
continue to receive the eligibility for the
subsidies. Community Health Assist
Scheme(CHAS).

Government Subsidies
Other Public / Community Services

Government Polyclinics Voluntary Welfare Organizations(VWOs)
• Services provided is subsidized at about • Provides healthcare services such as
50%. 75% if the patient is a child or renal dialysis, mental rehabilitation and
elderly. nursing home care.
• Standard drugs - subsidy of 75% for • MOH funds 50% of operating expenses
lower-to-middle income patients. Means- of these VWOS and 90% of their capital
testing aligned to CHAS. expenditure.
• With CHAS, lower-to-middle

Singaporeans will receive subsidized
primary care at GPs and dental clinics in
their neighbourhood.
3. CPF Healthcare Financing Schemes

CPF Schemes which can be used to meet members’ healthcare needs are:
A. Medisave;
B. MediShield Life;
C. Integrated Shield Plans and
D. ElderShield and ElderShield Supplement.
A. Medisave
1. National healthcare saving scheme where the amount contributed is from the CPF members
and their employers. Amounts in the MA earn an attractive annual interest rate and can be
used to pay for a member or their immediate family's medical expenses. Immediate family
refers to spouse, children, parents and grandparents. Grandparents must be Singaporeans
or Singapore Permanent Residents (SPRs).
2. 2 Changes from 1 Jan 2016 :
1. Basic Healthcare Sum (BHS)

• Medisave Contribution Ceiling is the maximum balance a member can save in his
Medisave Account (MA) will be renamed as the Basic Healthcare Sum(BHS) set at
S$52,000 (as of 1 Jan 2017) for CPF member. If the member is of age 65 years &
above in 2016, this sum will be his BHS for life. However if he is below age of 65
years, BHS applicable to him will be adjusted yearly in January. When a CPF
member reaches the age of 65, the BHS for him will be fixed at the BHS that year
and the amount will not change for the rest of his life.
• Amount in the MA up to the BHS cannot be withdrawn. Medisave contributions will

go into the MA until it reaches the BHS, any amount above the BHS will be
automatically transferred to the members' Special or Retirement Accounts to boost
his monthly payouts. If the member already met his Full Retirement Sum, amount will
flow to his OA, can be withdrawn as cash from age 55.

2. Removal Of Medisave Minimum Sum (MMS)

• Before 1 Jan 2016, when a member withdrew his CPF savings at or after the age of
55 years, he needed to set aside at least the Medisave Minimum Sum (MMS) in his
MA. The amount was S$43,500 in the year 2015. If he did not have enough in his
MA at withdrawal, he would need to use the excess from his OA and SA to top up his
MA to the MMS, before he can withdraw.
• Since 1 Jan 2016, Medisave Minimum Sum has been removed, hence CPF member
will no longer be required to top up his Medisave Account to the Medisave Minimum
Sum when withdrawing his CPF Savings (OA & SA) at the age of 55 years. This
provides certainty on how much a CPF member can withdraw from his OA & SA after
the age of 55 years.
3. Uses of Medisave
Medisave can be used to pay for hospitalisation and selected outpatient treatment
expenses (up to the withdrawal limits) such as :
• Colonoscopies;
• Mammograms ;
• Chemotherapy and radiotherapy.
It can also be for the following subject to withdrawal limits and other conditions:
a. Inpatient Expenses - daily ward charges, doctor's fees & inpatient charges of medical
treatment, investigations, medicines, implants, prostheses introduced during surgery.
Currently, a CPF member can withdraw up to S$450 per day for daily hospital charges,
which includes a maximum of S$50 for doctor's daily attendance fees. For surgical
operation, withdrawal limit ranges from S$250 to S$7,550.
b. Day Surgery And Surgical Operation. - CPF members aged 50 years and above can use
their Medisave to pay for their screening of colonoscopies & mammograms at approved
medical centres up to specified limit.
c. Inpatient Psychiatric Treatment.
d. Inpatient Stay in Community/Convalescent Hospital & Inpatient Hospice and Approved

Treatment in Day Hospital & Day Rehabilitation Centre.
e. Outpatient Treatment For Approved Chronic Disease Under The Chronic Disease
Management Programme (CDMP).
1. Medisave can be used to pay for outpatient treatment for 19 approved chronic
diseases under CDMP such as diabetes, high blood cholesterol, hypertension
or asthma. These diseases can:
• result in serious complications like heart disease, kidney failure and leg
amputations if not well managed; and
• have high cost of treating them over the long term if poorly controlled.
2. The aim of allowing Medisave use under CDMP is to :

• lower long-term healthcare costs; and
• improve care for patients with chronic diseases, resulting in better health
outcomes.

3. Under CDMP, Medisave can be used to pay for :

• consultations;
• drugs/medications (including non standard drugs);
• laboratory tests;
• diagnostic tests, eg eye screening, foot screening; and
• allied health services, such as nursing and physiotherapy as referred by
the doctor.
4. Medisave cannot be used for the purchase of glucometers, glucometers strips,

blood pressure monitoring equipment, wheelchairs, prostheses, or other home
nursing equipment.
5. To avoid over-consumption patients must make a 15% cash co-payment for all
CDMP claims. The amount of Medisave that can be used for CDMP is $400 per
immediate family member's MA per calendar year, up to 10 MAs can be used for
each claim.
f. Approved Outpatient Treatments

• Approved vaccinations (e.g Hepatitis B, pneumococcal disease, Human
Papillomavirus (HPV), vaccinations on National Childhood Immunization
Schedule).
• Screening mammograms;
• Renal dialysis;
• Cancer treatment (Chemotherapy, radiotherapy and related diagnostics); and
• Outpatient scans required for diagnosis and/or treatment of a medical condition.
In addition, under the Flexi- Medisave Scheme, elderly patients age 65 years and
above can use up to S$200 of Medisave per patient per year for outpatient medical
treatment at the public sector SOCs, polyclinics and participating CHAS GP clinics.
g. Maternity Charges & Assisted Conception Procedure Treatments

• Medisave Maternity Package allows a female CPF member or her family
member to use Medisave to pay for pre delivery expenses and delivery
expenses (eg consultations and Ultrasound) and delivery expenses.
• Couples can use their Medisave up to a lifetime limit of S$15,000 per patient to
pay for Assisted Conception Procedure treatments which must be performed
locally. Only Medisave accounts of the patient and her spouse can be used.
h. Buying Medical Insurance

Medisave can be used to pay for approved Integrated Shield Plans , ElderShield and
ElderShield Supplements from approved insurers. The use of Medisave to pay for
insurance premiums is subject to withdrawal limits. (cover later).
4. Where Can Medisave Be Used?

In all public healthcare institutions, as well as approved private hospitals and medical
institutions.

5. Whose Medisave Can Be Used?

• Patient's immediate family members (i.e spouse, parents and children) can use their
Medisave to pay for the hospitalisation bill. Eg. 2 children can specify how much each
will pay for their mum's hospitalisation bill.
• If immediate family members' MAs is not enough to pay for the bill, then non immediate
family members e.g brothers and sisters can appeal to help settle the bill. This option is
only available if the patient qualifies under certain conditions, e.g stayed in class B2 or
C ward of a public hospital and has exhausted the moneys in his own and
immediate family members' MAs.
6. Distribution of Medisave Upon Demise
Admission to hospital just before death
Patient had authorised to use his Patient had not signed the Authorization
Medisave to pay his medical bill, all his Form before his demise, his immediate family
Medisave balance will be used to pay in member / relative could sign the form to pay
full, without being subject to withdrawal his last inpatient medical bill.
limits to pay his last medical bill.
Remaining Medisave balance :

• If a nomination is made - Payable to the nominated beneficiaries.
• If no nomination is made, balance would be distributed by the

Public Trustee to his family members under the Intestacy laws for
non-Muslims, or the Muslim Inheritance laws for Muslims.

B. MediShield Life
1. Unlike Medisave which is a savings scheme, MediShield Life is a basic healthcare
insurance scheme which replaced MediShield on 1 Nov 2015. It is compulsory for all
Singaporeans Citizens and SPRs, regardless of where they reside. They is no need to apply
for MediShield Life, all are covered for life, in line towards universal insurance coverage from
1/11/2015.
2. It offers :
• Better protection and higher payouts , so that patients pay less Medisave/cash for
large bills;
• For protection for all Singapore Citizens and SPRs, including very old and those who
have pre-existing conditions; and
• Protection for life.
3. Benefits have been enhanced under MediShield Life, with higher claim limits and lower co-
insurance rates, so that MediShield Life pays more and patients pay less. (Table 8.1 at page
127 of text ).
4. MediShield Life premiums will be higher than MediShield premiums due to:
a. Better benefits than MediShield;
b. Cover Singaporeans and SPRs with pre-existing conditions. Those with serious
pre-existing conditions may have to pay additional premiums (of 30% of standard
MediShield Life premiums) for 10 years . The additional premiums does not reflect
actual costs of coverage as the Government bears most of the cost;
c. More even distribution over lifetime : Premiums are higher for working age groups to
achieve a more even distribution of premiums over one's lifetime. This will help to
cushion the impact premium increases during the retirement years through premium
rebates.
5. MediShield Life Subsidies

Besides being able to use Medisave to pay for MediShield Life premiums in full, the
Government will help Singapore Citizens and SPRs with their MediShield Life Premiums
through the following subsidies:
(a) Premium Subsidies for lower-to middle -income;

(b) Pioneer Generation Subsidies for the Pioneers;
(c) Transitional Subsidies to ease the shift to MediShield Life for Singapore Citizens; and
(d) Additional Premium Support for those who are unable to afford their premiums even
after subsidies.

MediShield Life Subsidies
Type of Subsidy Subsidies Received
Premium Subsidies
Criteria :
• For lower-to-middle income families; 50% of their premiums. SPRs will
received 1/2 the subsidy rate applicable to
• Monthly income per person of S$2,600 and Singapore Citizens.
below and living homes of an Annual Value
(AV) of S$21,000 and below. AV covers all This is a permanent feature of MediShield
HDB flats and some private properties. Life Scheme
Those with more than 1 property will not be
eligible for this subsidy.
Pioneer Generation Subsidies

• Pioneers refer to living Singaporeans who • Between 40% & 60%; regardless of
meet 2 criteria : their household monthly income per
a. Age 16 yrs and above in 1965 (born on person or AV of their home.
or before 31/12/1949, which also means
that they are 65 yrs and above in 2014);
and • Will also received S$200 to S$800 a
year in Medisave top-ups (depend on
b. obtained citizenship on or before 31 Dec year of birth) for life, which can be used
1986. for their MediShield Life premiums.
( Cross Ref : Pg 147 of text).
(Definition extract from Pg 146 of text).
Transitional Subsidies • Available for the first 4 years of

To ease the shift to MediShield Life for all MediShield Life;
Singapore Citizens whose net premiums
(after all the above subsidies) increase in • 1st Year - Government will pay 90% of
comparison to MediShield premiums, the net premium increase (after above
regardless of their household income or AV of subsidies);
their home.
• 2nd to 4th years - Government will
cover 70%, 40% & 20% of the net
premium increase of MediShield Life
respectively.
Additional Premium Support

Families needing assistance with their
premiums even after above subsidies and
Medisave use.
No one should worry about losing their

MediShield Life coverage, because he is
unable to afford the premiums.

6. MediShield Life Claim Payouts

• It pays on a reimbursement basis, subject to the limits imposed on the covered medical
expenses, as well as deductibles, co-insurance and pro-ration factors.
• Deductible is the fixed amount payable by the insured once every policy year. However
insured member need not pay deductible for outpatient treatments covered under
MediShield Life.
• Co-insurance is the percentage of the claimable amount which insured will have to pay on
top of the deductible. The larger the bill, the lower will be the co-insurance payable.
• MediShield Life benefits are designed to cover subsidized bills incurred in B2/C wards in
public hospitals. Thus bills incurred in Class A, B1 or B2 + wards in public hospitals
/private hospitals are pro-rated to the equivalent B2/C bills before claims under MediShield
Life are computed. Hence with limits imposed on the covered medical expenses, as well as
deductibles, co-insurance and pro-ration factors, the scheme will never pay the full bill.
(Eg 8.2 of page 132 textbook).
7. MediShield Life Scheme Act

Keys features of the Act are:
a) Extension of lifelong, universal coverage and better benefits for all Singapore Citizens
and SPRs;
b) Establishment of the MediShield Life Council to review the administration of the Scheme
in line with the policy intent;
c) Providing for access to information to facilitate the extension of MediShield Life premium
subsidies to eligible households and scheme administration; and
d) Powers for the recovery of premiums from willful defaulters as a last resort, to ensure
that the premiums are paid in a timely manner.
Section 10 of the MediShield Life Scheme Act 2015 states that :

1. Rights and benefits of an insured person arising from the insurance cover under the
Scheme are not assignable or transferable.
2. Policy does not create any legal or equitable trust.
3. Section 73 of the Conveyancing and Law of Property Act (Cap.61) and Section 49L of
the Insurance Act (Cap 142) do not apply to any policy under the Scheme;
4. The Insurance Act does not apply to the Scheme or anything under this Act.
8. MediShield Life Fund

• MediShield Life is a not-for-profit, long term insurance scheme run by the government.
• Renewal of MediShield Life policy every year is guaranteed, regardless of whether they
develop serious illness after they join.
• Premiums collected are put in the MediShield Life Fund, based on the actuarial principles
and to be self-sustaining with each age group paying premiums to support its own current

and future claims. Premiums are adjusted every 3 to 5 years, taking into account any
variation in claims experiences and benefits enhancement.
C. Integrated Shield Plan (IPs)
1. IPs are Medisave-approved hospitalisation insurance plans, made up of 2 parts:

An Integrated Shield Plan has 2 parts:
• Provides higher coverage (e.g covers costs

of private hospitals or Class B1 or A wards in
public hospitals).
Additional Private
Insurance Coverage • Managed by a private Insurer.
• Enough to cover your large hospital bills in

class B2 or C wards in public hospitals .
MediShield Life
• Managed by CPF Board.
• On 1 Nov 2015, those who have IPs are covered under MediShield Life and there is no
duplication of coverage between IPs and MediShield Life.
• The following plans are IPs as at 1 April 2016:

• AIA HealthShield Gold Max;
• AXA Shield
• Aviva MyShield;
• Great Eastern SupremeHealth;
• NTUC IncomeShield;
• Prudential's PruShield.
2. Insurance representative to highlight to client:
a. If they wish to stay in private or subsidised ward in a public or private hospital and if
they wish to choose their own doctors. From the usage of IP Policyholders, it seems
to show that there is a significant degree of overconsumption in the purchase of IPs.
b. Premiums for IPs are higher than MediShield Life and increase significantly as an
insured persons get older and they are not guaranteed.
c. The private component of the IPs premiums may not be fully payable by Medisave.
Policyholders may have to pay part of their IP premiums in cash.
d. There are different benefits provided in the IP Policy and plans can be "as charged"
or "non-as-charged" (i.e they have sub limits imposed).

3. Integrated Structure Of IPs

1. An Integrated Shield Plan has 2 parts. The premiums paid to private insurers also
comprises 2 parts:
• Premium for MediShield Life component; and
• Premium for additional coverage by the IP insurer.
Structure & Premiums

• IP policy holders will enjoy the benefits of MediShield
Life within his IP Policy.
• He will pay one premium to his private insurer who

will then arrange with CPF Board on the amount
Additional Private claimable under MediShield Life component.
Insurance Coverage
• He need not liaise with both parties.
Coverage for IP
IP insurers are allowed to risk-load insured members
with pre-existing conditions for the private insurance
components of the IPs.
Coverage - MediShield ife

• He will be covered for pre-existing conditions for
MediShield Life
life under MediShield Life even though the condition
may excluded by the IP Insurers.
2. A person insured under IPs will also be able to receive the applicable MediShield
Life subsidies eg.
• Premium Subsidies for lower-to-middle income;
• Pioneer Generation Subsidies;
• Transitional Subsidies.
but will not be eligible for Additional Premium Support. Those who cannot afford to
pay IP should remain on MediShield Life.
3. Changes to MediShield Life will affect private insurers. Increase in coverage in MediShield
Life is expected to reduce claims from private insurance components of the IPs. However
this does not mean that the private insurer will pay less. They will need to factor in claims
experience and medical inflation along the benefits offered to decide on the level of
premiums for additional private insurance coverage.
IPs insurers have committed to leave the private insurance component of premiums
unchanged for 1 year from the launch of MediShield Life. Nonetheless overall IPs
premium will increase when MediShield Life is launched owing to the higher premiums for
MediShield Life component of the IPs.

4. Differences between CPF MediShield Life Scheme and IP
MediShield Life Integrated Shield Plan (IP)
Administrated by CPF Board. Administrated and insured by only insurers as

approved by MOH.
Designed for B2 and C class ward in Provides for enhanced coverage beyond
public hospital stay. MediShield Life with various plans types
available for private and/or Class B1/A public
hospital stays.
Covers all pre-existing conditions. May decline or imposed with exclusions and/ or
restrictions, arising from pre-existing conditions.
No minimum or maximum age limit. May have a minimum or maximum entry age
limit.
Sub-limits applicable. May have sub-limits, although most do not have
sub-limits.
MediShield Life premiums are fully Private insurance component of the IP premium
payable under Medisave. is payable by Medisave up to the Additional
Withdrawal Limit, the rest is payable by cash.
5. Standard IP
1) "No Frill" Standard IP product , developed by the government with IP Insurers to cover
class B1 ward hospital bills and selected outpatient treatment.
2) From 1 May 2016, all IP insurers are required to sell the Standard IP. Benefits of the
Standard IP are regulated by MOH, and are identical across all IP insurers. It can
cover 9 out of 10 Class B1 bills. It also has co-insurance and deductible
components.
3) Managed by insurers and underwriting decisions are determined by the insurers ,

hence premiums therefore vary depending on each insurer's approach.
4) An affordable option for those who want additional coverage beyond MediShield Life
and may find other higher coverage IPs too expensive.

6. Medisave Use for IP Premiums
Integrated Shield Plan
Additional private insurance coverage premium can be

paid by Medisave up to the Additional Withdrawal
Limit (AWL). The AWL is set per insured person per
Private Insurance policy year, as follows:
Coverage
• Age Next Birthday (ANB) 40 and below : S$300
• ANB 41 to 70 years : S$600
• ANB 71 years and above : S$900
MediShield
Life
MediShield Life Premium is fully payable by Medisave.
7. Riders
• IP Insurers are allowed to sell rider which pays for co-insurance and deductible portion
of the IP payouts. These riders are not approved or regulated by MOH and cannot be
paid using Medisave. Insurers are not allowed to market riders as part of IPs.
• Agent should highlight distinction between IP and riders and share that riders can be
paid using only cash. Important to remind policyholders that rider premiums rise
significantly with age. Instead of paying for a rider, the deductible and co-
insurance portion incurred in the event of hospitalisation can be save for and
paid via Medisave or cash.
8. a. Downgrading IP
• Can downgrade to a lower coverage plan within the same insurer at any point of time
without underwriting.
• Can downgrade to basic MediShield Life, without any exclusions imposed.
b. Switching Insurer for IP

• His original IP will automatically terminated when he switches to a new IP with
another insurer. IP with the insurer will have to undergo underwriting again. Hence
he may lose coverage for his existing medical conditions covered by his original plan
and may not be able to re-apply for his original coverage subsequently.
• Any policyholder who switches his IP from one insurer to another will have the option
to go back to the previous insurer within 30 days from the date of notification of
termination from the previous insurer. No re-underwriting is allowed by the
previous insurer, and it would be as if the first IP had never been terminated.
• If a claim is received by the new insurer and the claim incurred date falls within 30
days from the commencement date of the new policy and the new insurer is not able
to admit the claim for any reason, the new insurer has the option to request the policy
holder to reinstate his policy with the previous insurer. The previous insurer will
take the claim incurred date (or claim event date) to be the date of request to

reinstate the policy. Once reinstated, the claim will be assessed by the previous
insurer, and the claim will be paid by the previous insurer if the liability under the
previous insurer's policy is established.
9. Improvements to IP Regulatory & Accountability Framework

• Insurer's disclosure documents include:
• Product Summary;
• Proposal form;
• Offer letter.
• Insurers need to highlight:

• Distinction between MediShield Life and IPs;
• Limitation of upgrading, switching and the option to downgrade and

remain covered by MediShield Life;
• Intermediaries selling IPs to undergo a minimum of 2 hrs of training on

MediShield Life and IPs.
• Appropriate minimum standard guidelines are required to deal with allegations of

misrepresentation by reps that lead to customer detriment as a result of inappropriate
switching.
• The complaints handling guidelines as specified in LIA's "MU 57/15- Integrated Shield
Plans : Reinstatement Guidelines" apply to market conduct complaints related to
alleged inappropriate switching of IPs, where the customer is outside of the 30-day
reinstatement period. In such cases, all obligations now fall entirely on the new insurer.

10. Claim process for MediShield Life/IP, Medisave and Non IP Insurer.
Admission to hospital
Sign the Medical Claims Authorisation Form to :

i. allow hospital to claim from his insurer;
ii. authorize CPF Board to pay hospital bill from his Medisave account, while the
insurer settles the claim which may take some time.
Pay a cash deposit with hospital
No Yes / No
1. Under IP Policy
2. Non IP Private Insurance
Hospital will trigger a “Letter of Guarantee" Need to show his insurance card
(LOG) to waive the upfront cash required up provided by some insurers for certain
to a cap of S$10,000. LOG is not applicable if Medical Expense Insurance Plans.
hospitalised due to pre-excluded conditions.
For claims from MediShield Life, IP/or Medisave :

Hospital will submit the claim on his behalf
through the MediClaim online system. • Some hospital will sent the bill
directly to the CPF members non IP
Insurer or employer to work out the
a. For IP Claims amount to bear.
Hospital will submit the claims electronically
to the Insurers directly. IP will calculate how • In other cases, insured member will
much to pay based on IP benefits, and CPF have to submit the bill himself to the
Board will calculate how much MediShield insurer.
Life will pay. The eventual payment will be
the higher of the 2 amount. Eg Payout
based on full IP benefits is $2,000, and the
payout based on MediShield Life benefit is
$500. The policy holder will receive $2,000,
which comprises $500 from MediShield Life
and $1,500 from IP's additional coverage.
b. For MediShield Life Claims without IP

CPF Board will calculate how much MediShield Life will pay and settle the amount
directly with the hospital.
c. Medisave to pay for his bill

Hospital will submit the claims electronically to CPF Board based on prevailing
Medisave withdrawal limits.
Any outstanding amount not covered by the above, have to be settled in cash.

D. ElderShield & ElderShield Supplements
Plan ElderShield
Purpose
A new Severe Old Age Disability Insurance Scheme to provide long
term care to the elderly Singaporean to help defray out of pocket
expenses in the event of severe disability. Any member who is a
Singaporean or Permanent Resident who attains the age of 40 years is
automatically covered unless he opts out.
Plans 1. ElderShield 300 - launched in Sept 2002

Payout of S$300 per month for maximum of 60 months if unable to
perform at least 3 ADLs.
2. ElderShield 400 - launched in 2007

Improved coverage of S$400 per month for maximum of 72 months
if unable to perform at least 3 ADLs.
Note : ADLs’ definition is the same as Chapter 5.
3. ElderShield Supplement covers :

• increasing monthly payout;
• extending payout period;
• a combination of both.
Only existing ElderShield insured can purchase ElderShield

Supplement. Premium can be paid from Medisave up to $600 (per
insured per calendar year) or by cash.
Run By • Aviva Ltd

• NTUC Income Insurance Co-Operative Ltd
• Great Eastern Life Assurance Co Ltd
• Level premium, paid from Medisave;

Premiums
• Premiums payable up to age 65 yrs, but remains insured for life.
• Premiums are not guaranteed, review every 5 yrs.
• 2 types of premium plan available

• Regular Premium Plan;
• 10 year premium plan (Not available now).
• Insured members who do not have sufficient Medisave, may use

their spouse, children, parents or grandchildren Medisave to pay
for their premiums.

Eligibility Criteria • Waiting period of 90 days from commencement date.
• Scheme will pay (either $300 or $400) if insured is unable to

perform at least 3 of the 6 ADLs.
• Deferment period: 90 days from claim date. Does not apply if

insured suffers a relapse from the same cause within 180 days
of recovery, provided he has been disabled for at least 90 days
during the first disability.
Claim • Insured complete a claim form;
• Insured has to make an appointment with one of the insurer’s

appointed assessors to have a medical assessment done.
• It will cost S$50 for assessment at the assessor's clinic and

S$150 if insured requires assessor to make a house call. The
fees for the initial or subsequent assessments are borne by the
insurer if the claims is assessed to be payable.
How are ElderShield • Payable on a monthly basis

Benefits Paid?
• Premium waived during disability;
• Payments stop if insured recovered from his disability, premium

payment will resume. However he can still make a claim under
his policy, as long as he has not claimed more than 60 months
or 70 months in total.(depending on his ElderShield Plan).
• Cash payout is not tied to institutional care. It can be used

to pay for any expenses.
Non-forfeiture Option Premiums are prefunded. Policy will be converted to a paid up policy
should he decides to stop paying his premiums after the policy is
inforce for a number of years. Insured will enjoy a reduced benefits.
Key Features • Has a minimum (i.e 40 yrs old) and maximum entry age (i.e 64
years old);
• 75 days’ grace period for payment of overdue premium;
• Reinstatement allowed within 180 days from the expiry of grace

period, subject to evidence of insurability and payment of
overdue premiums and interests;
• When the insured is oversea at the time of claim, insurer has

the right to compute the benefit payments to a single payment
based on the PV of future benefit payments, or withhold the
claim payment if it is unable to assess the claim after having

made reasonable attempts to do so.
• No surrender value.
• 60 days’ free look period from commencement date;
4. Other Healthcare Financing Schemes for the Poor and Needy Singaporeans:
1. Pioneer Generation Package

From 2014, the Government introduced the Pioneer Generation Package to thank the
pioneers for their significant contributions in nation-building.
Definition of "Pioneer Generation" - refers to living Singaporeans who meet 2 criteria:
(a) Age 16 years and above in 1965 (born on or before 31 Dec 1949, which also
means they are age 65 yrs and above in 2014); and
(b) Obtained citizenship on or before 31 Dec 1986.
The package provides the following benefits which the Pioneer Generation will enjoy
for life:
1. Outpatient Care
• Additional 50% off :
• subsidised services at polyclinics and Specialist Outpatient Clinics
(from Sept 2014).
• subsidised medications at polyclinics and Specialist
Outpatient Clinics (from Jan 2015).
• Special subsidies at participating GP and dental clinics under CHAS

(from Sept 2014).
• Cash of S$1,200 a year for those with moderate to serve functional

disabilities under the Pioneer Generation Disability Assistance Scheme
(from Sept 2014).
2. MediShield Life - Pioneer Generation Subsidies - cover earlier.
3. Medisave Top-ups - From S$200 to S$800 annually for life (from July 2014) as
follows:
• Born 1934 and earlier - $800
• Born 1935-1939 - $600
• Born 1940-1944 - $400
• Born 1945 - 1949 - $200
4. Pioneer Generation Disability Assistance Scheme - Pioneers who need assistance

in at least 3 of the ADLS (as defined earlier under ElderShield) will receive lifelong
cash assistance of S$100 each month to help Pioneers with their care expenses.

2. Interim Disability Assistance Programme for the Elderly (IDAPE)
1. Launched by the government to take care of Singaporeans who are not eligible for
ElderShield Scheme for 2 reasons; either they had exceeded the maximum entry age
or they had pre-existing disability can apply to IDAPE.
2. It is a social scheme to help people cope with their medical expenses in the event
they suffer a severe disability.
3. Premiums need not be paid. Payments under the scheme depend on individual’s per
capita household income. (see table)
IDAPE Payout
Per Capita Household Income IDAPE Payout (with effect from 1 July 2013)
S$0 to S$1,800 S$250 per month up to 72 months

S$1,801 to S$2,600 S$150 per month up to 72 months
An IDAPE applicant from a household with no income will qualify for the S$250
monthly payout if the annual value of his place of residence is $13,000 or lower.
4. IDAPE is administered by Agency of Integrated Care (AIC). It is similar to

ElderShield except for :
a. To making a claim under IDAPE will be subject to a means testing administered

by Ministry Of Heath Holdings(MOHH); and
b. The recipient of the payout will need to pay only a nominal fee of S$10 for a clinic
assessment (or S$40 if assessment is done at home) for each assessment in the
event of a claim. The rest of the fees are subsidised by the Government.
3. Medifund
• An endowment fund set up by the government to assist the needy Singaporeans who
face financial difficulties with their healthcare bills.
• Medifund Silver and Medifund Junior were set up in 2007 and 2013 respectively to
target the elderly and children.
• Any patient who fulfils the following requirements may approach the Medical Social
Workers of the Medifund approved institutions for assistance:
(a) he is a Singapore Citizen;
(b) he is a subsidized patient;
(c) he has received treatment from a Medifund approved institution.

Chapter 9 – Common Policy Provisions

Health Insurance policy is a written evidence of a contract between Insurer and Policyholder. It
contains 7 sections. They are:
1. Policy Schedule
2. Insurance Clause and Definitions
3. General Conditions
4. Benefit Provisions
5. Exclusions
6. Claim Conditions
7. Endorsements
1. Policy Schedule
1. It contains details of the policy owner, insured person(s) as well as the insurance
coverage. There is a clause in the policy stating that this schedule and the policy must
be read “together as one contract”. It includes:
• Policy number,
• Effective date of cover and expiry date of cover;
• Issue date;
• Contract Currency;
• Name, NRIC, age, gender of insured person;
• Name of plan, riders and premiums;
• Special provisions/endorsements.
2. Adviser need to go through this schedule with the policy owner to ensure no
typographical error and that the insurance coverage tallies with what the policy owner
has agreed to purchase.
2. Insuring Clause and Definitions

1. It is also known as operative clause, it states the purpose of the policy and outlines the
conditions under which the policy will pay. It serves to:
• describes the general scope of coverage:
• provide any definitions required; and
• set forth the conditions under which the benefits are payable.
2. It is often viewed as the foundation of a Health Insurance Policy, in terms of the

insurer's general agreement to provide the coverage.
3. Among the many definitions in the text, please know:
Definitions
a) Accident a) It means an incident caused by accidental, violent, external

and visible means.
b) Day of Hospital b) It refers to a full 24 hours during a period of hospital

Confinement confinement.

c) Medically c) It means a service, supply or day of hospital confinement

Necessary which is ordered by a physician and which is:
Service, Supply or • Provided for the diagnosis of direct treatment;
Day of Hospital • Appropriate and consistent with symptoms for treatment;
Confinement • In accordance with accepted medical practices;
• Not of an experimental nature or research purposes.
The fact that the insured’s physician prescribes a service

supply or day of confinement does not automatically means is
medically necessary.
d) Period of Hospital d) It means a continual, medically necessary period of time

Confinement during which an insured is confined to a hospital as a
registered inpatient. Patients have to stay for a period of
6 to 24 hours before being considered hospitalized.
e) Pre existing e) Defined as a condition which have existed and :

condition • For which insured received treatment or medical
advice;
• In respect of which insured showed symptoms;
• Of which insured was aware;
• Of which insured should reasonably have been
aware;
Prior to the date policy issue or the date the cover was
reinstated.
Moratorium Underwriting
Insured does not need to make medical declarations when
he applies for cover. Pre-existing conditions can be covered
after a continuous period of e.g 5 years from the effective date
of coverage, reinstatement date whichever is later. For the
specified years, insured must not have experienced any
symptoms, seek consultation, received treatment or
medication for the condition. In addition, the insurer may also
have list of pre-existing conditions that are permanently
excluded from coverage, e.g cancer, stroke, heart attack,
kidney failure, etc.
f) Usual, customary
f) It refers to the standard charge for the provider and the
and reasonable
amount does not exceed the amount usually charged in
charges
the same geographical area for an equivalent service.
g) Maximum amount a MEI Policy will pay for an insured within

g) Per Policy Year
each policy year.
Limit
h) Lifetime Limit
h) Maximum amount a MEI Policy will pay under the policy.

3. General Conditions
• Outlines the rights of both policyholder and insurer.
• It includes the following :
• Also known as “The Policy Contract Clause”;

Entire Contract Clause
• In consideration of first premium received, insurer will start
providing benefits;
• In a Health Insurance Contract the policy document,

proposal form and endorsements are the entire contract
between insured and insurer.
• For sickness – it will commence after the waiting period.

Effective Date Of Cover
• For injury – it will commence as at the effective date of
insurance.
Premium Warranty Policy shall not be in force, unless premium is paid on or before
Clause the inception date of the policy.
Free Look Period Policy owner may review within 14 days from the receipt of the
policy and return for a refund of premium (less medical fees
incurred). The policy document is deemed to have received by
the policy owner within 7 days after insurer dispatched it.
Actively At Work Not eligible for cover if he is absent from work because of
sickness, injury, on the otherwise effective date of coverage.
However, in Disability Income Insurance, it provides that cover
will automatically terminate when the person is not working due
to illness or termination of service.
Renewal Provision describes the circumstances which the

Renewal insurer has the right :
• to refuse to renew;
• to cancel coverage;
• to increase the amount of premium payable.
HI polices can be issued on these basis:

• Cancellable - Terminates the policy at any time for any
reason, simply by notifying the policy owner in writing
and refunding any advance premium that has been paid
for the policy.
• Optionally Renewable - Insurer has the right to refuse to

renew the policy on certain dates, usually the policy
anniversary or premium due date.

• Conditionally Renewable - Insurer refusal to renew

cannot be related to insured’s health, but rather age and
employment status.
• Guaranteed Renewable -Insurer relinquishes the rights to

cancel the policy. Renewal is guaranteed as long as
insured pays the premium, until a specified age.
Premiums are higher than for cancellable policies. Non-
payment of premium is the only reason that an insurer
may refuse to renew. The guaranteed feature is often
limited. (eg. until age 60,65, 75 years).
• Non renewable – examples are: Term Insurance,

Travel Insurance, Student Personal Accident.
Mis-Statement Of Insurer will adjust premium based on correct age or sex.

Age or Sex
Grace Period Usually 30 days from premium due date. Coverage remains in
force during grace period.
Reinstatement This provision states that if certain conditions are met, the
insurer will reinstate a lapsed policy for non premium payment,
provided insured person pays any overdue premium and
complete a health warranty.
Incontestability Health Insurance riders attached to Life Insurance policies will be

subject to the Incontestability Clause. This provision makes life
insurance policies indisputable after they have been in force for a
certain minimum period (usually one year). It stops the insurer
from repudiating liability under a policy purely on grounds of
breach of utmost food faith, except fraud has been proven.
Co- Ordination Of Benefit Also known as

• Over-insurance provision;
• Contribution provision.
To prevent the insured from making a profit from sickness/illness.

Will cause the insurer to reduce the benefits payable under the
policy.
Cancellation Allows the policy owner to cancel the policy by giving written
notice to the insurer within a certain time (e.g 7 days). In such a
case, the policy owner is usually entitled to a return of the excess
premium paid less any administrative cost deemed by the
insurer.

Change Of Plan A MEI Policy has a provision to allow the insured to upgrade or
downgrade the coverage plan, at the insured’s expense. Any
application of change should be submitted to insurer at least 30
days before the policy renewal date or Premium due date.
Currency Payments of all claims and benefits will be made in Singapore

Currency.
Last Payer Status This clause appears in MediShield and Private Integrated
Shield Plans where it states the insurer shall be the last payer
reimbursing the claims if the insured has any other Medical
Insurance, such as workman compensation. The insured person
shall provide insurer with the full details of such other insurance
policies or employee’s benefit.
Nomination Of NOB gives a clear and affordable legal means to distribute the
Beneficiaries (NOB) policy benefits to their nominees. Since CI Insurance policies
have a built-in death benefits, they will come under NOB
framework. Hence, the insured who is the policy owner and
attained the age of 18, can make a nomination:
• Trust Nomination
- The insured loses all rights to the ownership of the
policy. To revoke trust nomination, the insured needs
the written consent of all the nominees.
• Revocable Nomination
- The insured retains the ownership of the policy and is
free to change, add or remove nominees, without their
consent.
Policy Owner’s • Set up to protect policy owners in the event of failure of

Protection Scheme a life or general insurer which is a PPF Scheme member.
(PPF Scheme)
• The scope of this scheme includes individual and group
short-term or long-term accident and health policies (e.g
Hospital Cash, Medical Expense, Personal Accident,
Disability Income, Long term Care Insurance.)
• Is administered by the Singapore Deposit Insurance

Corporation. Coverage for PPF is automatic and no
further action is required from the policy owner.

4. Benefit Provisions
1. This section is the essence of any insurance policy. This provision set forth the
insurer's promises. Each benefit is explained in detail and the conditions under which
payment will be made.
2. It is written with utmost care and must be clear and precise and broad enough to cover
virtually any claim situation that can conceivably arise.
5. Exclusions
Exclusions refer to the circumstances under which the insurer will not pay. No benefits will be
paid for charges which are in excess of the usual, customary and reasonable charges.
Illness contracted within the waiting period, pre-existing conditions are not covered.
6. Claims Conditions
1. Includes provisions that define insured’s obligation to provide timely notification of loss
to the insurer.
2. Physical Examination Provisions – usually included in most individual and group

Disability Income Policies. After the insured submits a claim, the insurer has the
right to have the insured person examined by a doctor of the insurer’s choice, the
insurer’s expense to validate claim.
3. Mediation/Arbitration and Legal Actions Provisions

• Health Insurance Policy will include a Dispute Resolution Clause. All dispute under
the policy should be referred to Financial Industry Disputes Resolution Centre
Ltd (FIDReC). If the dispute cannot be dealt with by FIDReC, it will be referred to
and decided using arbitration, according to the Arbitration Rules of the Singapore
International Arbitration Centre. Insurer will not be legally liable unless insured
first received an award under arbitration.
• Where both mediation and arbitration fail to settle the dispute, the insured may
seek legal actions against the insurer. Legal provision limits the time during
which the insured who disagree with the insurer’s claim decision has the right to
sue for the rightful amount. The Policy states that no action in law or equity will be
brought under the policy until after the expiration of 60 days from the date a
satisfactory proof of claim has been furnished to the insurance company in
accordance with terms and conditions of the policy.
7. Endorsements
An endorsement is a separate document that modifies the policy to which it is attached.
Modifications can be:
• Supplementary agreements (e.g maternity benefits for attachment to Hospital and

Surgical Policy).
• Exclusions (e.g exclude pre-existing conditions)

Chapter 10 – Health Insurance Pricing
1. 7 keys factors used in Premium Computation
1. Morbidity Experience Morbidity experience is the primary consideration for Health

Insurance Pricing. It measures rate of sickness or failure of
health. All things being equal, the morbidity rate of women is
higher than men, hence woman pay higher premium rates than
men for most Health Insurance policies.
2. Investment income Investment income is the money that is earned, when an insurer
invests the premium which it receives from the many policy
owners. Increase in investment income will lead to a decrease
in premium.
3. Operating expenses Increase in operating expenses will lead to an increase in

premium.
4. Medical Inflation Medical inflation will lead to an increase in premium.
5. Scope of benefits Increase in scope of benefits will lead to an increase in premium.
Loading is added to net premium to provide a profit margin.

6. Insurer’s Profit Loading depends on the insurer's profit strategy, Hence, a line of
business that is volatile or requires more capital support will
result in an increase in loading. (increase premium)
7. Modes of premium • Annually – once a year;

Payment • Bi- annually – twice a year;
• Quarterly – once every 3 months;
• Monthly – once a month (most expensive).

2. Parameters For Premium Rating:

1. Age
• the older the person, the more likely the premium will be higher.
2. Gender
• Women’s premium is higher than male for health insurance products.
3. Health Status
• refers to proposed health status of the proposed insured.(eg pre- existing conditions).
4. Life Style
• Can influence premium charge. E.g- hazardous sport will call for extra premium. The
most important lifestyle factor for determining premium rate is smoking, which will
attract a higher premium.
5. Occupation
• The higher the risk of injury or illness resulting from an occupation, the higher the
insurance premium.
6. Persistency
• Refers to the percentage of policies renewed each year. Persistency usually
improves with age.
• A group of younger insureds (e.g ages of 20 to 29) may have poorer persistency than
a group of older insureds (e.g ages of 50 to 59 years). The older insureds will tend to
see the policy as more valuable, because they may have more difficulty satisfying the
underwriting requirement associated with buying a new policy.
• If the persistency rate of a type of coverage is expected to be high, then the insurer
will reduce the amount of premium charge.
7. Claims Experience
• Claims experience demonstrates the general health condition of the group and the
propensity of the group members to file claim. For group insurance, claims
experience is a key factor affecting premium rate charged.
8. Participation Level
• For voluntary group plans, the extent of participation by employees in the plan is an
important parameter in the development of premium rates.
• Low participation means there will be greater chance that a higher than normal
proportion of unhealthy lives will seek coverage. This is called adverse selection.

Chapter 11 – Health Insurance Underwriting

1. What Is Underwriting?
1. It is the process, whereby an insurer assesses the risk and determines whether or not to
accept an application and, if so, on what terms that it will offer coverage to the applicant.
2. The main purpose of underwriting is a process to ensure premium charged correspond

closely with the risk that each proposer represents.
3. Whole Life Insurance underwriting is concerned primarily with mortality (i.e the
incidence of death within a given population). Health Insurance underwriting is
concerned primarily with morbidity, which is the incidence of injury, illness or failure of
health.
2. Underwriting Factors That Affect The Risk

1. The factors that affect risk can be broadly classified as
• Medical; and
• Non- medical.
Medical Factors Non Medical Factors
1. Medical History 1. Financial Factors

Insurers review history of previous • To measure affordability;
conditions to determine :
• An important consideration in underwriting
• Possibility of recurrence; individual Disability Income Insurance;
• Effect of a medical history on • To determine if the benefit for DI is justifiable.

proposer’s general health; A high net worth is significant, even if the
proposer's assets are not producing
• Complications that may arise; substantial investment income at the time of
underwriting. Assets can be shifted to
• Normal progression of any income generating investments if the insured
impairment. becomes disabled, the resulting income
combined with DI benefits can lessen the
insured's incentive to return to work.
2. Current Physical Condition
The proposer’s statement on a 2. Occupational Factors
proposal and medical examinations Accident hazards – e.g painter of tall buildings.
results are the first indicators of Health Hazards –e.g handling asbestos will lead
present physical conditions, before to respiratory failure.
underwriters request for other tests,
depending on the age of the 3. Age
proposer and the amount of Older – more thorough underwriting because of
insurance coverage applied for. possibility of health problems.
4. Avocations / Life Style Risk

a. Examples of Life Style risks - Drug abuse,
hazardous occupations, multiple sexual
partners, hazardous sport.
b. Habits - Eg drinking and drug use.

3. Factors That Are Specifically Important For Each Type Of Health Insurance
Products.
Health Insurance Plans Factors

• Medical history;
Medical Expense Insurance • Current physical condition.
• Size and stability of earnings;

Disability Income Insurance • Overall financial situation;
• Occupation risks classifications used by insurers
to evaluate risks more accurately.
• Detection of cognitive impairments;

Long Term Care Insurance • Morbidity risk.
• Medical history
Critical Illness • Current physical condition
• Smoking habit;
• Family history.
• For Individual – same as MEI;

Managed Healthcare • For Group – age and gender.
4. Types of Underwriting Methods for Medical Expense Insurance
Full Medical Underwriting Moratorium Underwriting
• Proposed insured completes a health • No need to fill in a health declaration nor

declaration when he applies for cover. undergo a medical examination.
• Pre-existing conditions are excluded. • Insurer will declared a waiting period (e.g 2
to 5 yrs) that will automatically exclude
any pre-existing conditions for which
insured has been treated, immediately
before the commencement date of cover.
However, if insured does not have any
symptoms, treatment etc for those pre-
existing conditions during the waiting
period, then he will be covered when those
conditions recur, subject to the terms and
Advantage conditions.
• Insured has certainty as to what is
covered at the point of joining rather Advantage
than when he needs to make a claim. • Provides only basic information about
himself, but must understand that any pre-
existing condition are excluded from cover,
unless he can satisfy moratorium criteria
for pre-existing condition (as above).

5. Group Underwriting Factors
1. Reason For Existence

The reason for the existence of a group applying for group coverage must be for some
purpose other than for purchasing insurance. This is to prevent anti- selection. The
group members must be actively at work on a full time regular basis and have a fairly
predictable income.
2. Group Stability
An ideal group for insurers is one in which there is a steady flow of new members to
replace those who leave, but not massive influx or outflow of members.
3. Group Size
Group size is important, as it provides a better spread and diversification of risk.
4. Insured company’s nature of business

Certain lines of business are more risky than others.
5. Employee Classes
• Over-representation by a highly paid class can result in higher than average
medical claims.
• Over-representation by a class which the employees earn low income can result in a
higher-than –desired rate of turnover.
6. Level of Participation
Especially in a contributory plan as members’ participation is on a voluntary basis.
Insurers normally specify a minimum participation level requirement of e.g 70% to 90% to
prevent anti- selection.
7. Age and Gender

Age is important in underwriting, as it increases the mortality of the group. Gender in the
form of ratio of males to females is important as females have lower mortality rates, but
higher morbidity rates than males.
8. Medical Utilisation & Trend

Changes in utilisation can affect trend hence increase premium.
A group policy has been in force for some time, the average age may rise, thus
increasing the frequency of claims. Changes in medical practice, such as use of new
drugs can affect the cost of a plan.
9. Expected Persistency - covered in Chapter 10.
10. Past Claims Experience - covered in Chapter 10.
11. Medical Inflation - covered in Chapter 10.

6. Sources of Underwriting Information
1. The proposal (application) form is the primary source of underwriting information for the
insurer. It will form the contract and used as a basis when a claim is filed.
Sections Of A Proposal Form

(i) Identities Of The Contract Parties
The insurance contract is between the insurer and the proposer.
• Header of the proposal form - States the names of the insurer and contact
details.
• “Particulars of the life to be insured” and “Particulars of the Proposer” serves
2 reasons. Firstly is to distinguished the proposer from the proposed
insured. Although the proposed insured and the proposer are usually the
same person, unless it is a third party policy. Secondly, to provide relevant
information to the underwriter to assess the risk, as well as the correct
premium to be charged.
(ii) Particulars Of Policy Applied For

Details of the policy and sum assured.
(iii) Information Regarding Past Applications And Existing Policies

For the proposer to :
• state the type of policies that he already has or has applied for, but was
postponed or rejected;
• whether he is purchasing this policy to replace an existing policy.
(iv) Personal Health Details and Habits Of The Proposed Insured

This section is critical as it provides a detailed description of the proposed
insured’s medical history, physical conditions, habit etc, as well as family history.
(v) Declaration
Serves the following purposes that the proposed insured:
• has disclosed all material facts truthfully;
• has not withheld any material facts;
• is aware that the benefits may be lost if material facts are not disclosed;
• agrees and authorizes insurer to release to any medical source or insurance
office, any information concerning him, regardless of whether the proposal is
eventually taken up.
2. The Agent’s Statement – to indicate :

• Knowledge of any information on the proposer that is not in the proposal form;
• Proposer’s net worth, earned income, income from other sources.
3. Medical Examinations /Tests

Namely for these plans:
• Disability Income Insurance
• Critical Illness Insurance
• Long Term Care Insurance

4. Attending Physician Statement

To enable the underwriter to have a better insight into the applicant’s medical history
that is not available from the medical examination.
5. Supplemental Questionnaires
E.g- financial questionnaires are to gather information about net worth and unearned
income.
7. How An Insurance Representative Can Help In The Underwriting Process

The representative is considered the field underwriter as he has personal contact with the
client. He can help by :
• establishing his client's motivation and needs to purchase the policy.
• if any answers in the proposal form is "yes", he should extract as much details as
possible from this client. By obtaining such information, the rep can help the underwriter
to decide whether there is a need to call for Attending Physician's Statement or a
completion of questionnaires.
• ensuring all the questions in the proposal form are duly completed and signed by the
proposer in the presence of the rep. This enables the proposal form to be processed
expeditiously. Knowing the underwriting guidelines will help to expedite the
underwriting process.

8. Final Underwriting Decision
1. Standard Risk
Policy issued is based on premium rates stated in the rate book. 80% to 90% of all
proposals received by the insurer are accepted at standard rates.
2. Sub-Standard Risk
These are for people with medical or non-medical impairments which make them higher
risks to the insurer. The insurer deals with a sub-standard risk, by, modifying cover as
follow:
1. Modifications Of Cover
• Specific Exclusions
E.g. excluding disease of the intestines, commonly usually used in Medical
Expense Insurance.
• Extra Premium
Usually used for these plans:
Disability Income Insurance, Critical Illness Insurance.
• Modifications of Benefits offered. E.g reduction in monthly benefits.
2. Postponement
E.g: going for a surgery.
3. Declined
The most drastic underwriting decision is to decline a proposal. Usually for serious
medical reasons.
9. Commencement of Risk
Risk commences when the applicant agrees to the terms stated in the letter of acceptance
and pays premium.

Chapter 12 – Notice No: MAS 120 – Disclosure and

Advisory Process Requirements For Accident And
Health Insurance Products
1. Scope of Notice No: MAS 120
This Notice comprises both mandatory requirements and best practice standards on
disclosure of information and provision of advice to policy owners:
• A & H Policies; and
• Life Policies with A & H Benefits.
2. This Notice applies to all direct insurers, licensed or exempt financial advisers under the
Insurance Act (Cap 142) who provide advice and /or arranges A&H policies. This Notice does
not apply where:
• Such policies are in respect of reinsurance of liabilities under insurance policies; and
• Such policies provide that the accident and health benefits are paid out only if the
insured becomes totally and permanently disabled, as defined under that policy.
3. Structure of Notice No: MAS 120

This Notice comprises the following :
(a). Part 1 – Mandatory Requirements;
(i) Division 1 : General requirements for accident and health policies;
(ii) Division 1A : Disclosure requirements for accident and health policies;
(iii) Division 2 : Disclosure requirements for life policies that contains accident and
health benefits;
(iv) Division 3 : Additional disclosure requirements for direct insurers;
(v) Division 4 : Requirements on provision of advice relating to accident and health

policies;
(vi) Division 5 : Requirements on provision of advice relating to the life policies that
contains accident and health benefits;
(vii) Division 6 : Offences relating to this Part;
(b). Part 2 - Non- Mandatory Best Practice Standards on
(1) Information Disclosure and Provision of Advice ;
(2) Monitoring Of Switching For Long-Term A & H Policies.
4. This Notice shall come into effect on 1 April 2004.

Part 1 – Mandatory Requirements
Division 1: General Requirements for Accident and Health Policies

1. No direct insurer shall use the word "Shield" in the name, description or title of any accident and
health policy issued by it unless that policy is a Medisave approved policy.
2. Notwithstanding the above, a direct insurer may prior to 1 November 2017, continue to use the
word "Shield" in the name, description or title of any accident and health policy issued by it prior
to 1 November 2015.
Division 1A: Disclosure Requirements for Accident and Health Policies

This Division sets out the minimum standard on disclosure to policy owners by A&H insurance
intermediaries in relation to accident and health policies that are mandatory.
1. General Information about the A&H insurance intermediary and the status of an A&H
insurance representative.
An A&H insurance intermediary shall disclose to a policy owner in writing its business name
under which it conducts its insurance business, its business address and its telephone number.
The reps to disclose in writing, his name, the A&H insurance intermediary for which he acts. Any
changes to such information, both the A&H insurance intermediary and the reps to inform the
policy owner in writing.
2. Remuneration of the A&H Insurance Intermediary

An A&H insurance intermediary shall disclose in writing to a policy owner all remuneration,
including any commission, fee, and other benefit, that it has received or will be receiving for
providing advice on any accident and health policy.
3. Conflict of Interest
An A&H insurance intermediary shall disclose to its policy owners in writing any actual or
potential conflict of interest arising from any connection to or association with any insurer,
including any material information that may compromise its objectivity in advice provided.
4. Disclosure when Providing Advice

1. An A&H insurance intermediary shall disclose to a policy owner the following information.
The policy owner can refers to an individual or policy owner of a group policy.
For group policy where the insured person is liable to pay any premium (voluntary
group), A&H insurance intermediary to disclose to every person in the group as if it is
dealing with them individually:
a) Nature and objective of the policy;
b) Details of the insurer;
c) Contractual rights and obligations;

An A&H insurance intermediary to explain to the policy owner :
• the party against which the policy owner may take action to enforce his rights
with respect to the policy he has purchased;

• that he (policy owner) is responsible for the accuracy and completeness of the
information when applying for the policy and making a claim. Any misstatement
or non disclosure of material facts may affect validity of the policy.
• the amount and frequency over which the payment is to be made, and whether
the premium rate is guaranteed or non-guaranteed.
d) Benefits of the Policy

• Conditions under which the payment of policy moneys (guaranteed/non
guaranteed) is to be made or not made to the insured;
• Any lien on the policy.
e) Risks of the Policy

An insurance intermediary shall disclose and explain to the policy owner the risks to
be borne in the purchase of the policy, including:
• Whether insurer may alter the terms of contract, and if so, what may be altered
and under what conditions would the alterations be allowed;
• Whether insurer may decline to renew the policy or unilaterally terminate the
policy.
f) Provision of free-look period of the policy

An A&H intermediary shall disclose and explain the time frame for the policy
owner to reconsider his purchase of the policy and the terms and procedures for
exercising the policy owner's rights under this provision.
g) Claim or termination
An A&H insurance intermediary shall disclose and explain the procedures,
restrictions, charges on claim or termination of the policy.
h) Warnings, exclusions and disclaimers.
2. Where a benefit illustration or a product summary in respect of accident and health policy
prepared by the insurer or the A&H insurance intermediary is available, it shall be
furnished and explain to the insured.
3. When an A&H insurance intermediary prepares a benefit illustration or a product summary,

it shall be prepared in accordance to the industry standards, if any set for the insurers.
4. In the case of a personal accident policy, shall ensure that insured is aware that the policy
moneys shall be payable in the event:
• of an injury to, or disability as a result of accident;
• of death by accident;
• combination of above.
5. Marketing Materials
Representatives shall only use marketing materials with respect to an integrated Shield Plan or
an accident & health policy, approved by the A&H insurance intermediary for which the
representative acts.

6. Telemarketing and Direct Marketing

1. In the case of using telemarketing over the phone to solicit and close a sale for accident &
health policies which are not Medisave-approved policies, A& H insurance intermediary
shall, where no advice is provided, communicate to the call recipient a warning that:
• he may wish to seek advice from an A&H insurance intermediary before purchasing
the policy;
• in the event the call recipient choose not to seek advice, he should consider
suitability of the policy; and
Intermediary shall maintain a record of all conversations made over the phone sufficient
for the purpose of conducting audit checks where necessary.
2. An A&H insurance intermediary shall not close a sale of any Medisave-approved policy
over the phone. Where an A&H insurance intermediary engages in the marketing of
Medisave-approved policy over the phone in a manner designed to solicit a sale, it shall:
(a) communicate clearly to the call recipient that it is calling only to provide
information and not to sell that policy over the phone;
(b) follow the script approved by the insurer issuing the policy in providing information
relating to that policy; and
(c) maintain a record of all conversations made over the phone sufficient for the
purpose of conducting audit checks where necessary.
3. In the case of marketing A&H policies using direct response advertising communications
through any medium including mail, print, TV, radio and electronic media to solicit and
close a sale, A& H insurance intermediary shall include, in all its marketing materials a
prominent warning that:
a. Policy owner may wish to seek advice from an A&H insurance intermediary before
purchasing the policy;
b. In the event the policy owner chooses not to seek advice, he should consider
suitability of the policy;
c. In the event that the policy owner decides that the policy is not suitable after
purchasing it, he may terminate the policy in accordance with the free-look
provision, if any, and the insurer may recover from the policy owner any expense
incurred by the insurer in underwriting the policy.
Division 2 : Disclosure requirements for Life Policies that Contains Accident and
Health Benefits
This Division is covered in Division 1.

Division 3 : Additional Requirements for Direct Insurers
1. When a direct insurer prepares a benefit illustration or a product summary for policies it
underwrites, it shall be prepared according to industry standards, if any.
2. For every integrated shield plan or non-integrated shield plan which a direct insurer issues,
it shall provides the policy owner with information disclosed in the respective documents
found in Appendix A of this section (refer to pg 229 of text).
3. Where the direct insurer provides the policy owner with the following documents, it shall
ensure a font size Times New Roman 10-point or larger, as the case may be. The
documents are:
(a) a conditional letter of offer or termination letter for any individual medical expense policy
(as set in Appendix B);
(b) a product summary of any A&H policy which is not Medisave-approved policy (as set in
Appendix C);
(c) a product summary of renewable short term accident health policy (as set in Appendix
D).
4. Any alterations made in the terms of the contract, the direct insurer shall disclose and
explain the new terms and the manner in which policy owner may accept these new terms or
the circumstances under which the policy owner will be deemed to have accepted the new
terms. Such information should be furnished to the policy owner in writing at least 30 days
before the variation or amendments take effect.
Appendix mentioned above from Pg 229 to 237of text.
• Appendix A - Pg 229 to 237

Information to be included in the respective documents for integrated shield
plans and non-integrated shield plans. ( Essentially Chapter 8)
• Appendix B - Pg 238
Standard Disclosures For All Individual Medical Expense Policies.
• Appendix C - pg 239
Standardized Disclosures For All Accident & Health Policies which are not
Medisave-Approved Policies.
• Appendix D - Pg 240
Standardized Disclosures For Renewable Short-Term Accident & Health Policies.

Division 4 : Requirements on Provision of Advice Relating to Accident and Health

Policies
1. This Division shall not apply to:
• Circumstances where no recommendation is made or where only factual information

is provided with respect to any health policy; or
• Any advice provided in respect of ElderShield Policy.
2. An A&H insurance intermediary shall have a reasonable basis for providing advice with
respect to any health insurance policy to a person. For the purpose of ascertaining that the
advice is reasonable, the representative shall give regard to the information such as the
person’s objective, financial situation, particular needs, etc.
3. In providing advice on health policies to the policy owners, A&H insurance intermediary shall
comply with
a. Know- Your Client
b. Needs Analysis; and
c. Documentation and Record Keeping.
3a. Know Your Client
Individual Group
• Objectives of policy owner; • Objectives of the insured;

• Employment status; • Size and composition of the group
• Financial situation; including age, gender, income,
• Financial commitments; occupation;
• Existing health insurance, including • Claims history of the group;
policy from CPF; • Any medical conditions of members of
• Any medical conditions; the group.
• Whether policy is to include
dependants.
A& H intermediary shall highlight in writing the following:
a. information provided will be the basis on which advice will be made;
b. any inaccurate or incomplete information provided may affect suitability of the

advice.

3b. Needs Analysis

• A&H insurance intermediary shall analyze the information provided;
• Where the A&H insurance intermediary is unable to identify a suitable policy, it

shall inform the insured accordingly.
Where a policy owner does not want to provide any information requested in (a), or
accept the advice of the A&H insurance intermediary and chooses to purchase another
policy which is not advised by the intermediary, then the intermediary:
• may proceed to the insured’s request but it shall properly document the
decision of the policy owner; and
• inform the policy owner that it is the policy owner’s responsibility to ensure
suitability of the policy selected.
3c. Documentation and Record Keeping

Before the policy owner signs on the application form for the purchase of a Health Policy
or gives consent for withdrawal or surrender of a Health Policy, A&H insurance
intermediary shall furnish to its policy owner a document containing a summary of the
information gathered and the basis of the advice given and where applicable a
statement that the insured does not want to provide information or received advice of the
A&H insurance intermediary.
4. Switching of Accident and Health Insurance Policies

An A&H insurance intermediary shall not cause a policy owner to switch products that would
be detrimental to the insured. The following are examples of detrimental switch:
a. whether the policy owner suffers any penalty for terminating the original policy;
b. whether the policy owner will incur any transaction cost without gaining any real benefit;
c. whether the replacement policy confers a lower level of benefit at a higher cost or
same cost; or the same level of benefit at a higher cost;
d. whether the replacement policy is less suitable.
5. An A&H insurance intermediary shall disclose in writing to a policy owner :

a. any fee or charges the policy owner would have to bear;
b. the changes in the level of benefits,
if he were to switch from one A&H policy to another, in order to ensure that the policy owner
is able to make an informed decision on whether to switch.
Division 5 : Requirements on Provision of Advice Relating to the Life Policies that

Contains Accident and Health Benefits
This Division is covered in Division 4.

Division 6: Offences Relating to This Part

Any person who fails to comply with any requirement under any paragraph of this Notice shall be
guilty of an offence punishable under section 55(2) of the Act.
Part Two – Non Mandatory Best Practice Standards.
1. Information Disclosure and Provision of Advice

An A&H insurance intermediary is expected to all meet in all product information disclosures
and information (including marketing materials) given to policy owners to include:
• Information disclosed in any advertisement should be in plain language, jargons

explained;
• Information provided should be sufficient (not limited to this Act and Notice) and should
accord with industry best practices to help insured make an informed decision;
• Warning and important information such as nature, objective of product, risks, fees and
charges should be prominently presented and clearly explained.
• Information should not be ambiguous. It should be disclosed in an objective and

unbiased manner. There should be a reasonable basis for expressing an opinion, and
it should be unambiguously stated that it is an opinion;
• Documents should be kept up to date.
2. Monitoring Of Switching For Long-Term Accident and Health Policies

1. To facilitate the monitoring of switching for long-term accident & health policies, that may
be detrimental to an insured's interest , an A&H insurance intermediary should ensure
policy owner declare in writing whether he has been advised by the A&H insurance
rep to switch policy. A declaration should also be made in the following situations:
a. the switch is to another accident and health policy with different accident and health
benefits as the policy that was terminated; and
b. the policy that was terminated was purchased from another A&H insurance
intermediary.
2. If the switch was advised by the A&H insurance rep, A&H insurance intermediary
should ensure that the policy owner makes a declaration:
a. whether the rep has drawn his attention to the costs and possible disadvantages
associated with the switch; and
b. whether he wishes to proceed with the switch notwithstanding that the fees, charges
or disadvantages that may arise from the switch could outweigh any potential
benefits.
3. If the switch was advised by the A&H insurance rep, supervisor of the A&H rep
should review the switching recommendation and indicates in writing, whether he agrees
with the recommendation made and if not, the actions that have been taken to rectify the
situation.

4. An A&H insurance intermediary should institute controls, process and procedures to

effectively monitor and track the switching of long-term accident and health plans, including
but not limited to :
a. track the volume of switches to identify any reps with an unusually high volume of
switching transactions;
b. put in place procedures to ensure that each switch recommended is reviewed by

the supervisor for appropriateness; and
c. implementing procedures and controls to identify any unusual trends in

switching transactions.
5. When an A&H insurance intermediary detects a switch that is not declared by the policy
owner, the A&H insurance intermediary should ensure that supervisor of the A&H rep
should reviews the switch and indicates in writing, whether he agrees with the
recommendation, if any and if not, the actions that have been taken to rectify the situation.
6. An A&H intermediary should ensure that the back-end controls processes and procedures
implemented, commensurate with A&H insurance intermediary's nature of business and
risks.

Chapter 13 – Financial Need Analysis

1. Advantages of needs selling compared to product selling are:
• Service Oriented;
• Not Pressure Selling;
• Relationship Based.
2. In order to carry out needs selling, you need to know the prospective client, a requirement
under the Notice No: MAS 120. This can be achieved by completing a Fact-find using a Fact-
Find Document.
3. Needs selling involves these processes:

A. Fact- Finding
B. Identifying and Quantifying
C. Product Recommendation
D. Presenting your recommendation
E. Periodic Client Review
A. Fact-Finding
1. Fact-finding is the process of obtaining answers to a series of questions about a prospective

client’s personal circumstances, finance ambitions etc for the future. This will enable you to
have a better understanding of the client’s objectives and needs which will provide a proper
basis to recommend suitable Accident and Health (A&H) Insurance Products.
2. Common Sections of the Fact Find Form

Sections Purposes
This part serves 2 purposes:

a. General Information on 1. Gives the prospective client information on who the
Financial Adviser and rep is & which insurers he is representing, and the
Representative product classes he can provide advice on.
2. Highlight to client the importance of providing accurate

information on the Fact Find Form Document for
appropriateness of product recommendation to his
needs.
b. Application Type Type 1 :

This section enable the “I/We have to disclose all information requested for
prospective client to decide in this Form.”
on what type of services he
requires from you. • Meant for those who wish to complete the fact find
in full, so as to receive recommendations on
product suitability.
• The prospective client has to complete and sign

"Know Your Client" and "Our Advice and Reasons
Why" Forms.

Type 2 :
“I/We wish to receive product advice only.”
• Meant for those who do not wish to or unable to

provide all information requested in the form.
Suitable for those who wish to receive
recommendation on product suitability.
• The prospective client has to complete Section 2 -

"Our Advice and Reasons Why", sign Section 3 -
Acknowledgment.
Type 3:
“I/We do not wish to receive any advice from my/our
adviser.”
• Meant for those who already know which medical

insurance product and the amount of coverage
they want to purchase.
• The rep takes the prospective client's instruction

and assist him in the completion of the proposal
form, as well as understanding the Benefit
Illustration. The prospective client has to sign the
application type.
• Essential for admin purposes on the part of the

c. Personal Information company;
• Provides reps with a preliminary assessment on

type of products that will likely be needed;
• Age – needed or underwriting and premium

determination.
d. Employment Details • Determines whether eligible for DI , as DI is not

issued to any unemployed person;
• Employed/ Unemployed
• Determines the deferred period for DI, (self
• Monthly Income employed –shortest deferred period compared to
an employee, as he may continue to receive his
pay from his company for a period of time while
he is disabled);
• Determines occupational hazards.

1. Necessary for :
• Identification in event of claim;
e. Details of Spouse & • Premium determination (to cover dependant);
Dependants • Occupational hazard of spouse;
• Determines eligibility & whether a need to
provide A& H cover for dependants.
2. The Fact-Find Form may ask for the client's language

proficiency, educational level and accompaniment. E.g
if a prospective client is not proficient in written and
spoken English and/or posses primary school
education, he may be considered as vulnerable.
Hence the supervisor of the rep will make a call-back
to the client, to ensure he has understood the
recommendation and products for which he has
applied.
f. Existing HI Polices Serves as a reference point for further A & H insurance

recommendations. Avoid replacement or caused insured
to be over insured for those policies which is subject to
Co- Ordination of Benefit Clause.
• Enables reps to know client’s priorities with

g. Personal Priorities regard to A& H polices;
• As a professional insurance rep, it does not meant

you must follow strictly what the prospective client
has indicated, you should consider the overall profile
of the client to help him to re-prioritize the needs that
he has specified.
h. Health Condition • Determines insurability and on what terms;
• Obtain relevant reports to help to expedite the

underwriting process.
If the prospective client's answer is "yes" then

i. Replacement of Policy
• Explain consequences of replacement.
E.g: higher premiums, terms and conditions may be
less beneficial especially if there are any changes to
his health.

The Life Insurance Fact-Find Document has a section that

j. Customer's Financials gather information, such as customer's investment profile,
cash flow and budget, as well as assets and liabilities.
These serves to ascertain the affordability of the
recommendation and facilitates the planning of financial
needs.
j. Representative’s Declaration Information in Fact Find Form will be treated as

confidential, use strictly for determining product suitability
and not for any other purposes, bearing in mind the
requirements under the Personal Data Protection Act
2012. This will help to established trust between you and
the prospective client.
B. Identifying and Quantifying Needs
1. Identifying Needs
Analyze information gathered during Fact-Find Stage. Examples:
• Emergency Fund
• Useful to guard against breadwinner’s loss of a job or short term disability that
interrupts the financial flow of income to the family.
• If a client has no emergency fund, it may affect ability to service policies that
he may purchase from you.
• 7 Life Stages
• Most people will go through the following life stages :
• childhood;
• young unmarried;
• young married ;
• married with young children;
• married with older children'
• pre-retirement; and
• retirement.
• During active employment years, it is crucial to protects his earnings against

disability resulting from injury or sickness.
• The need for protection against ill health applies to person at any stage in his
life. Older people will have a greater need for CI, MEI and LTCI as there is a
higher chance of them falling sick or getting injured.

• Dependants
Provision should be made for medical expenses should dependant becomes
disabled, it will be a financial burden to the family’s finances.
• Clients’ Existing Polices.

If the prospective client has the given policies, you need to compare the benefits
under his existing insurance with his current needs to see of the prospective client is
sufficiently covered.
 Disability Income;
 Medical Expense Insurance; Covered in the respective
 Managed Healthcare ; chapters already
 Critical Illness;
 Long Term Care Insurance;
 Hospital Cash Insurance
 Work Injury Compensation Insurance
Pays in the event of any accident resulting in hospitalization, permanent
incapacity and/or death arising in the course of employment.
• Need for Health Insurance

Having gone through the list questions in the Fact-Find Document, you are now in a
position to determine:
• If the client does not have any need for Health Insurance Coverage - you
should not persuade him to purchase any such policy. Instead, you should do
review with him when circumstances change.
• If the client does have a need for Health Insurance, and he has the means to
pay, you have to quantify the client's Health Insurance needs.

2. Quantifying Needs
Quantifying is not mandatory, but an industry "best practice". Quantification of the
prospective client's needs are done :
1. Disability Income Protection Needs

1. Disability Income Protection Needs is also known as Maintenance Costs.
This is the amount that is required to meet the ongoing maintenance of the
prospective client and his dependants ( e.g their daily living expenses).
2. There are 3 methods. They are :
Quantify Maintenance Costs

Method 1 Method 2
• Using monthly salary, 75% of it is • Using monthly expenses instead of

his income protection in the event of income to determine the coverage
his disability. Hence : needed. Hence:
Disability Income Protection = Total monthly expenses less existing

75% x monthly income less existing disability benefit per month.
disability benefit per month.
Method 3
There may be circumstances under which the prospective client may not want, is not able to
afford a Disability Income Insurance (DII), or does not have an income to be eligible for DII
policy. For such prospective client, you can help provide with a total and permanent disability
benefits usually incorporated into a Life Insurance Policy.
This method provides a lump sum benefit should a person becomes totally and permanently
disabled.
Please go through the example from the text at page 255, Example 13.3.
Try this MCQ :

1. Quantify Maintenance cost using the Total and Permanent Disability Benefit Method,
given:
Salary per month: $3000

Expenses per month: $1,500
Rate of return 5%; Inflation rate 2%
Number of year income needed: 21
Covered under the following:

Group Term Life : $100,000
His own existing life Insurance $50,000
Answer: $135,795
(see attached answer below)

Workings:
$1,500 X 12 = $18,000
$18,000 X 15.8775 (table A2: 3%; 21 years) = $285,795
$285,795 – ($100,000 + $50,000)
= $135,795
2. Quantify the following Hospital Cash Insurance Policy (per day). Please go through the
example given at Pg 256 of text.
Try this MCQ:

Monthly expenses: $5,000
Existing Cash Benefit per month: $500
Answers :$150 per day
Workings:
($5,000- $500)/ 30
= $150 per day

C. Product Recommendations
1. 3 basic principles:
• Recommend products only if client needs them;
• Recommend products which are most suitable for him, given the circumstances.
Product suitability calls for good product knowledge. Affordability is an important factor
when selecting the most suitable product to recommend. Being able to afford the initial
premium does not mean that he will be able to sustain the regular payments. The insurer,
the representative, the prospective client do not benefit from early policy lapses.
• If he needs a product that the company you represent does not carry, let him know so that
he can find alternatives.
D. Presenting Your Recommendations

1. To ensure that the prospective client understands the product recommended and the reasons
for your recommendations, you should explain the features and benefits of the recommended
products, to see how these fit into his situation.
2. Before meeting the prospective client to go through your recommendation, plan how you
would like to present to him. An example below shows a systematic process in a sequential
order.
1. State the purpose of product;
2. Give a description of the nature of product;
3. Brief on the benefits and limitations of product;
4. Give a detailed explanations on options within the product;
5. Give a summary of the reasons for your recommendations;
6. Explain Benefit Illustration and highlight guaranteed and non

guaranteed benefits (if applicable);
7. Disclose any distribution costs, charges and expenses under the

policy
3. During the meeting, communicate clearly and simply. Avoid using technical jargon. If the
prospective client :
1. Accepts your recommendation:

• You have to ensure all relevant forms required by the insurer are properly
completed.
2. Does not accept your recommendation:

• You have to seek to clarify his reasons for not accepting. However, you should
not insist if the prospective client refuses to explain. Thank the prospective
client for his time before leaving.

E. Periodic Client Review

1. Regular reviews will ensure that your existing client continues to receive quality service from
you, and also reinforces your relationship with your existing client.
2. The question of when and how often the existing client's position should be reviewed depends
to some extent on the initial advice provided by you, and also on the client's own wishes for a
review. Generally, you should do a review under the following circumstances:
• Change in client’s circumstances, such as birth of a child;
• External development such as changes in CPF ruling etc which can have an impact
on the client’s financial position and/or the appropriateness of products already held;
• Original product purchased is not adequate to cover all his needs;
• The launching of new products in the financial services market.

Chapter 14 – Case Studies

This chapter brings out 2 case studies; one on individual and the other on group.
Case Study 1
Individual Health Insurance - Tommy Tang & Family
1. Source of Information:
Fact Find Form
• Information extracted from here for needs analysis.
2. After calculating maintenance cost, the most suitable product are :

• Disability Income Insurance
 suitable for Tommy as he is employed.
• TPD under a Life Insurance Policy /Personal Accident Insurance Policy

 suitable for Mrs. Tang, as she is unemployed.
3. Products to meet Medical Cost are:

• Medical Expense Insurance ;
• Managed Healthcare Insurance ;
• Long Term Care Insurance;
• Critical Illness Insurance ;
• Hospital Cash Insurance ;
• Personal Accident Policy
(with medical expense benefit)
4. To calculate Tommy's Medical Expense Protection :

Step 1 - Hospital inpatient cum surgical expenses determined by Tommy : $24,000
Step 2 - Angela, the rep, computes amount payable under :
• Tommy Group H & S Policy : ($17,520)
• Tommy IncomeShield Plan B : ($11,430)
Step 3 Amount of Medical Expense needed : ($4,950)
Conclusion : There is no shortfall for MEI, hence no protection needed.
5. Angela gave a summary of Insurance Package for Mr. & Mrs. Tang within the budget
given.
6. Having decided on the type of policies that are suitable to Tommy, Angela next
proceed to complete the "Representative Recommendations" section of the Fact-Find
Document. - Details at page 270 of text.
7. Angela finalised the insurance package to be recommended to the client and arranges
to meet up with the client, and presents the package to him.

Case Study 2
Group Health Insurance - Apex Services Co Pte Ltd
1. Source of Information:
Group Insurance Fact-Finding Form (GIFF)
• Information extracted from here for needs analysis.
2. Determined if the client meets underwriting requirements. (ie. in terms of group size,
group stability, etc).
3. Proceed to explain types of policies available and the benefits offered:

• Advantages of PMBS vs TMIS;
• Differences between compulsory and voluntary plans.
4 Determine Sum assured for Group Term Life Insurance in 2 ways:

• According to Rank
Advantage: Easy to manage as it goes according to rank of the employee.
• Number Of Times Of Employee Basic Salary.

This method is takes into account the length of service, as the salary of a more
experienced staff is likely to be higher than a new staff.
Advantage: More equitable
5. Obtain the company’s past 3 years of claim history. The claim history is very
important as it will determine the premium to be charged.
6. Client and representative must sign on the GIFF to enable insurer to give a quotation.
7. Submit the GIFF to the insurer to work out a quotation for your presentation to the
prospective client. Quotation will include coverage, underwriting guidelines, premiums,
exclusions, waiting period etc.
8. Rep to go through quotation, and once client accepts the quotation, rep to assists on
the completion of the proposal and health declaration forms, if necessary and submit
them together with premium payment to the insurer. Rep to arrange for the medical
examination, if any of the employees' coverage falls outside the free cover limit.

Health Insurance Quick Comparison At A Glance Strictly for Internal Use Only
Managed HealthCare Medical Expense Disability Income Long Term Care Critical Illness(CI) Hospital Cash
Definition & Purpose
Overall strategy for Reimbursement Income replacement to Pays daily or monthly Lump sum upon Daily cash benefit if
appropriate medical care benefits for specific safeguard one’s benefits. Cover cost of diagnosis of one of 37 one is hospitalized due
yet containing medical medical expenses that earning capacity if one care of person who is or more dread of accident or illness
cost. result from accidental is totally disabled and physically impaired and diseases or undergoing
3 components: & sickness. unable to work. that no longer able to surgical procedure
1. Accessibility function independently covered under the
PCP- are called - Inpatient Expenses Also known as - and have to depend on policy.
“Personal Physician, ( 11 points) Permanent Health others to help perform
“Gatekeeper” Insurance, Income ADLs. New: Severity based
- Outpatient Protection, Income CI Plans pay claim
2. Quality of care Expenses Replacement. during early stages and
(4 points) severity of CI (% of
3. Cost SA). Premium is higher
4 methods – - Catastrophic than normal CI.
• Capitation Outpatient
• Salary - Kidney and New: Multiple Pay CI
• discounted fee - cancer
• fee schedule treatment
Premium
Fixed Annual Premium Age Band Level Level Usually level and non Age band
guaranteed. For
policies on yearly
basis – age band.
Waiting Period
Apply, but not to Can choose deferred 90 days from inability to • 90 days waiting Apply, but not to
accidental injury. period. perform ADLs. period from date of accidental injury.
issue
/reinstatement.
• 30 days survival
period from
occurrence of CI.
Prudential Assurance Company Singapore (Pte) Limited. Produced by Julia Sim, based on 6th Edition (12/6/2017). 99
Min /Max Age of Coverage
15 days -75 years old Must be working Min age – determine by Min age: 1 Up to age 65 or 70
insurer. Max age : 55 years old
Max : 70 to 75 yrs next cover may expire at 65
birthday or whole life
Types
• Staff HMOs • Other benefits • Total disability • Pays daily or • Acceleration i.e. • Daily benefit
• Group HMOs under Med benefits. 3 Types monthly. advances sum chosen at
• Network HMOs Expense ( 8 points. - own occupation assured plus inception subject to
• Independent Impt to know: - similar occupation Daily (2 methods) bonuses specified no. Of
Practitioners major organ - any occupation 1. Service Based days and lifetime
Association (IPA) transplant, 2. Disability Based • Additional i.e. pays limit.
• Mixed Model miscarriage • Partial disability (Benefit Trigger) out dread disease
• Preferred Provider benefit, private benefit or sum assured • Fixed cash amount
organizations (PPOs) nursing home, final Rehabilitation Monthly without touching is not related to
• Point of Service Plans expense). expense benefit. (most common) death benefit. actual cost
(POS) • Diff b/w indiv and • Escalation benefit 100% - unable to incurred.
Group Policy. • WP benefit. perform 4 out of 6 • Severity based CI
• Death benefit. ADLs Plan - pays out
• Diff b/w from early to
compulsory & 50% - unable to intermediate to
voluntary plans. perform 2 out of 6 advanced and
ADLs. terminal.
• PMBS VS TMIS
Alzheimer’s disease • Multiple pay CI -
covered. allows more than 1
CI claim.
Also covers:
• Hosp R&B
• Surgical procedure
• Financial.
Assistance with
adaptation
• Extended care
Features
1. Standalone only 1. Standalone or rider 1. Standalone or rider 1. Standalone or rider 1. Standalone or 1. Standalone or
Rider rider. Standalone
2. Expense participation
2. 2 types - “as 2. Mthly income 2. Only 1 dread more attractive 6
2. Guaranteed
- Deductibles charged” benefits 3. Ben may be level disease claim to be points).
renewable
or sublimits or increase at made on one 2. Fixed amt per day
- Co insurance 3. Non-participating
imposed subject to given rate policy hosp benefit
4. Recover from
3. Can be extended to per policy yr & per 4. Ben include death, 3. Lump sum upon 3. Cap to max amt
disability, payment
lifetime limits partial & total diagnosis of DD payable on single
dependents. stop
3. Family coverage disability during 4. Policy must be in life
4. Reimbursement benefit period 5. No cash value or force 4. Ben not affected
5. Expense paid up value. 5. CI must be one by payment from
participation ie. 5. Guaranteed that is covered. other med
Deductible & co- renewable 6. Meets definition insurance policies
insurance, pro- 6. WP during benefit 7. Diagnosis meets 5. Mostly worldwide
ration factor. Note period conditions. coverage
insurers do not 7. Rehabilitation exp 8. Limitation on total 6. Hospital
imposed benefit. amt to minimize confinement (6 –
deductibles on 8. No surrender value moral hazard 24 hrs)
outpatient 9. No assignment (S$1m). 7. Guaranteed
treatments. 10. 30 days grace 9. 24-hrs a day renewable
6. Benefit Limits i.e. period worldwide 8. No surrender value
Lifetime, annual, 11. Benefits - non coverage. 9. No assignment
event taxable 10. No surrender value
10. No claim discount
7. Covered charges 11. Assignment may or
given (25%)
may not be
8. Geographical limit allowed
(Policy terminates). 12. For package DD
Policies, DD cover
9. Guaranteed will be terminates
renewability basis once NFO is
exercised, except
10. Co –ordination of
paid up option.
benefit clause.
Exclusions
1. As in MHC
1. Pre-existing conditions 1. Pre-existing 1. Pre-existing 1. Pre-existing 1. As in MEI
2. Congenital anomalies, conditions conditions conditions
hereditary conditions 2. AIDS and related 2. Mental or nervous 2. Congenital or
.Mental illness & 3. Self-inflicted disorders without inherited disorder
personality disorders 4. Drug or alcohol demonstrable 3. AIDS or related
3. Fertility-related indulgence organic disease 4. Self-inflicted
4. STD 5. Invasion, riot, 3. AIDS & related 5. Drug or alcohol
5. AIDS & related strike, civil except from blood misuse
6. Self-inflicted commotion transfusion or if 6. War & civil
7. Drug or alcohol 6. Pregnancy or medical staff is commotion
addiction childbirth except inflicted. 7. Flying other than a
8. Private Nursing where disability 4. Self-inflicted fare paying
Charges continues for more 5. Drug or alcohol passenger.
9. Kidney dialysis than 90 days after abuse
machine, iron lung, termination of 6. Felony, riot or
prosthesis pregnancy insurrection
10. Private nursing 7. Injuries while in 7. War or any act of
11. Civil commotion, riot, service of armed war.
strike forces (except for
12. Childbirth & related reservist training)
13. Reimbursement by 8. Aerial activity
Workmen comp 9. Professional or
hazardous sports
Underwriting
Important Factors in Important Factors in Important Factors in Important Factors in Important Factors in Not underwritten due
Underwriting. Underwriting: Underwriting Underwriting Underwriting to its small premium.
• Medical history • Size & stability of • Detection of early • Family history Pre existing conditions
Individual
• Current physical earning cog impairment • Smoking habit are permanently
• Medical history
condition • Overall financial • Morbidity risk • Medical history excluded.
• Current physical
condition
situation • Current physical
condition
Sources of Underwriting Source of Underwriting Source of Underwriting Source of Underwriting Source of Underwriting
• Individual • Proposal form • Proposal form • Lower non
- Proposal form • Individual • Some may ask for medical limit
Proposal form detailed medical compared to
• Group Group - Computerised info or undergo application for a
- Group fact find form payslip/ letter from clinical assessment life policy
• Group fact find Company.
- Individual health
• Below 10 - Notice of • Medical & family
declaration form
employees - Assesssement history
(for small group)
Individual - CPF Statement • Occupational risk
employee fills up (6months)
health declaration - Large amt
form. questionnaire if
benefit is more
than $60,000
- Medical test
• Self Employed
Proposal form
- Notice of
Assessment or
audited co a/c for
past 3 years.
- Large amt
questionnaire
- Medical tests
Termination of Cover
• Policy expires
• Death of insured • Policy expires • Valid DD claim • Per lifetime limit
• Nonpayment of
• Non-payment of made reached
• Life time limit premium
premium • Basic plan matures • Basic matures
reached • Reached max limit
• Insured dies or expires • Policy lapses due
• Policy terminated • Insured dies
• Expiry age • Policy lapse due to to non-payment of
• Non-payment of non-payment of premium
reached
premium
• Unemployed for premium • NFO
• Insured dies
more than • Surrender or • Insured dies
• End of yr expiry specified convert to • Expiry age
age reached time(except if he is extended term reached
• Date on which disabled) under NFO.
insured enters full- • Insured dies
time military ser • Resides outside
• Expiry age
except NS Spore for an
reached
reservist duty. aggregate of more
• Leave employer/ than 300 days
policyowner within 1 policy yr.
(group)
Claims
In-network care, no claims • Claim form • Claim form • Proof of inability to • Claimant • Claim form
required. • Physician • Physician perform ADLs on statement • Original bills
Statement Statement co. furnished forms • Attending
• Original med bills • NRIC/BC • NRIC/BC Physician Stt
Out-of-network: • Original bills
• Claimant’s statement • Evidence of • Proof of med • Proof of DD
• Original medical bills present or pre- examination • Original policy doc
disability earnings • Death cert • Written notice of
• Letter from claim submitted
company within 60 days of
• Copies of medical diagnosis.
certs & test results • Submission of
claimant’s form
within 15 days
after insurer sent
out.
• Proof of CI
submitted within 60
days from date of
diagnosis.
HI (6th Edition) Health Insurance (Mock Paper Version 1.1)
1. _________ ward of a public hospital does NOT receive subsidy from the Singapore
Government.
A. Class A
B. Class B1
C. Class B2
D. Class C
2. Which one of the following is NOT a strategic objective of the “Healthcare 2020” Masterplan put
together by the Ministry of Health?
A. It is to ensure affordability of healthcare.

B. It is to enhance the quality of healthcare.
C. It is to transfer the healthcare cost to the insurers.
D. It is to enhance accessibility to healthcare services.
3. Medical Expense Insurance is also known as __________ Insurance.
A. Critical Illness
B. Disability Income
C. Hospital and Surgical
D. Hospital Cash (Income)
4. Under a typical Medical Expense Insurance policy, hospital miscellaneous expenses which
refer to services and supplies (other than room and board and general nursing care) provided
during a hospital stay will usually include charges for:
A. short-stay ward
B. operating room
C. intensive care unit
D. surgical implant and prosthesis
5. Which one of the following regarding Medical Expense Insurance is TRUE?
A. The coverage and limits are standardised across insurers.

B. It is usually attached as a rider to a Term Insurance policy.
C. It can be extended to cover the immediate family members of the insured.
D. The insured has limited choice of the hospital and ward type when he is hospitalised.
Copyright reserved by Singapore College of Insurance Limited Page 1 of 12

6. __________ limit is the maximum amount payable for any one disability as specified in a typical
Medical Expense Insurance policy.
A. Event
B. Period
C. Annual
D. Lifetime
7. Mr Goh bought a family coverage plan of his Medical Expense Insurance policy. The
application was submitted at the same time. A family discount of 5% was given by the insurer.
The premiums payable were as follows:

(i) Mr Goh: S$150
(ii) Mr Goh’s spouse: S$170
(iii) Mr Goh’s son: S$120
(iv) Mr Goh’s daughter: S$140
Calculate the total premium payable by Mr Goh.
A. S$150
B. S$304
C. S$551
D. S$580
8. Which one of the following is NOT a characteristic of Group Insurance?
A. It is cost effective.
B. It is experience rated.
C. A master contract is issued.
D. It requires full underwriting.
9. One advantage of a contributory Group Insurance plan is that the employer:
A. has greater control over the benefit structure

B. has lower cost of administrative work involved
C. pays only part of the costs to provide the benefits
D. does not need to monitor regular payroll deduction
10. Under a typical Disability Income Insurance policy, where Total Disability is defined as “the
insured’s inability to perform any gainful occupation or a similar occupation for which the
insured is reasonably suited by reason of education, training or experience”, this refers to
__________ disability.
A. severity
B. any occupation
C. own occupation
D. modified own occupation

11. Which one of the following is NOT a factor for underwriting consideration by an insurer of
Disability Income Insurance?
A. Benefit amount.
B. Insured’s occupation.
C. Deferred/elimination period.
D. Limitation of disability benefit.
12. A type of Long-Term Care Insurance that pays a benefit when the insured incurs costs for
home care and satisfies the benefit trigger is the __________ policy.
A. fee-based
B. service-based
C. benefit-based
D. disability-based
13. Which one of the following statements regarding Long-Term Care Insurance is FALSE?
A. There is cash value or paid-up value at any time.

B. It can be issued as a rider or a stand-alone basis.
C. Its premiums are level throughout the policy term.
D. It is usually issued on a guaranteed renewable basis.
14. Before the policy owner of a typical Critical Illness (CI) Insurance policy can be eligible to claim
the benefit amount, certain eligible criteria must be met. Which one of the following is NOT an
eligible criterion?
A. The policy must be in force.

B. The life insured must be above a certain age.
C. The critical illness must be one that is covered.
D. The critical illness must meet its specified definition.
15. In a typical Critical Illness Insurance policy, the term, malignant tumour, under the standard
definition of “Major Cancers” will include:
A. sarcoma
B. carcinoma-in-situ
C. non-invasive tumour
D. pre-malignant tumour

16. A common feature of a Critical Illness (CI) Insurance is that:
A. it acquires a cash value immediately

B. its guaranteed premium is fixed at entry age
C. it pays a lump sum upon diagnosis of an insured critical illness
D. there is restriction on the usage of the CI Insurance benefit payable
17. Which one of the following circumstances will allow Mr Lim, the policy owner of a Travel
Insurance policy, to claim for medical expense benefits while he is overseas?
A. Aesthetic surgery performed in Seoul.

B. Routine health check-up conducted in New York.
C. Emergency accidental dental treatment in London.
D. Death resulting from a civil commotion in Bangkok.
18. Which one of the following statements BEST describes a Group Dental Care Insurance policy?
A. It usually includes a Limitation Clause.

B. It is usually issued on a contributory basis.
C. It usually excludes pre-existing dental conditions.
D. It usually covers replacement of broken dentures.
19. Mrs Ang bought a Whole Life insurance policy for a sum assured of S$300,000 when she was
28 years old. She added on a 30% accelerated critical illness rider to the insurance policy.
10 years later, she successfully claimed for the critical illness benefit. Owing to the illness, she
passed away 15 years later.
Assuming that there are no bonuses in the insurance policy, calculate the amount payable
upon Mrs Ang’s demise.
A. S$90,000
B. S$150,000
C. S$210,000
D. S$300,000
20. ____________ Model Health Maintenance Organisation (HMO) is NOT a traditional HMO, but
being common nowadays.
A. Staff
B. Mixed
C. Group
D. Network

21. A / An __________ Model Health Maintenance Organisation has the greatest cost control, but
its members have the lowest degree of choice of providers.
A. Staff
B. Group
C. Network
D. Independent Practitioners Association
22. The healthcare financing philosophy of Singapore is NOT based on the:
A. co-payment by individuals
B. individual medical savings accounts
C. risk-pooling for catastrophic illnesses
D. Government’s full subsidies of services
23. Being a CPF member, Mr Boo can use his Medisave savings to pay for the medical expenses
incurred by his __________ who is a Singapore Citizen.
A. godparent
B. grandparent
C. parent-in-law
D. foster parent
24. Which one of the following statements BEST describes the Basic Healthcare Sum (BHS) of a
CPF member?
A. The BHS is formerly known as the Medisave Minimum Sum.
B. Any amount above the BHS will always flow to the CPF member’s Ordinary Account.
C. The yearly BHS adjustment will apply only to a CPF member who is below the age of 65
years.
D. The amount in the Medisave Account up to the BHS can be withdrawn as cash from the
age of 55 years.
25. A CPF member aged of ________ years CANNOT use his Medisave savings for colonoscopy
screening.
A. 45
B. 50
C. 55
D. 60

26. Subject to the specified withdrawal limits, a CPF member can use his Medisave savings to pay
for the premiums of:
A. Hospital Cash Insurance

B. Critical Illness Insurance
C. ElderShield Supplement
D. Integrated Shield Plan Rider
27. Which one of the following statements regarding MediShield Life is FALSE?
A. It is sized for all treatments in private hospitals.
B. It has replaced MediShield scheme since 1 November 2015.
C. It automatically covers all Citizens and Permanent Residents of Singapore.
D. It is a basic healthcare insurance scheme in line with the principle of universal coverage.
28. Mr Lee, aged 45 years, purchased a Medical Insurance policy with the following breakdown in
the policy premium:
(i) MediShield Life component = S$1,000

(ii) Integrated Shield Plan by private insurer = S$700
Calculate the amount of premium payable by cash.
A. S$100
B. S$700
C. S$1,000
D. S$1,700
29. Mr Yeo is a Central Provident Fund (CPF) member and is 65 years old as of 1 January 2017.
Which of the following advice to be given to Mr Yeo on the Basic Healthcare Sum (BHS) is
TRUE?
A. Amounts above the BHS will flow to Mr Yeo’s Medisave Account.
B. The amount required for Mr Yeo’s BHS will not change for the rest of his life.
C. Amounts up to the BHS can be withdrawn as cash by Mr Yeo as he has reached 65

years old.
D. The BHS is designed for Mr Yeo to pay off any outstanding housing loan he still has at
age 65 years old.

30. Mr Law and Mrs Law are a young Singaporean married couple. They have been experiencing
difficulties in conceiving their first baby and wish to explore the possibility of using their
Medisave to pay for the Assisted Conception Procedure (ACP) treatments. They consulted a
specialist who will perform the procedure locally, and the expected cost of such ACP treatment
is S$25,000. Which one of the following options is TRUE?
They may use their Medisave:
A. to pay for the expected cost of S$25,000 for the ACP treatments
B. up to a lifetime limit of S$15,000 per patient to pay for the ACP treatments
C. up to a lifetime limit of S$10,000 per patient to pay for the ACP treatments
D. up to a lifetime limit of S$12,500 per patient to pay for the ACP treatments
31. Mr Tan has heard of the Medishield Life Scheme which came into effect in November 2015. He
is also covered under an Integrated Shield Plan (IP). Mr Tan has some concerns about both
covers as he is suffering from some pre-existing conditions. Which one of the following
statements is CORRECT?
A. IP covers all pre-existing conditions, while Medishield Life does not cover such conditions.
B. Medishield Life covers all pre-existing conditions, while IP may not cover such conditions.
C. Both Medishield Life and IP cover all pre-existing Conditions, but the premium for
Medishield Life is higher.
D. Both Medishield Life and IP covers all pre-existing conditions, but there are sub-limits
applicable in Medishield Life.
32. Mr Ng is a 40-year-old working Singaporean adult. He joined the Eldershield scheme on 1

October 2008. Should Mr Ng require long-term care during his old age resulting from a disability,
he will receive a cash payout of _______ under the Eldershield scheme.
A. S$300 per month for a maximum of 60 months

B. S$300 per month for a maximum of 72 months
C. S$400 per month for a maximum of 60 months
D. S$400 per month for a maximum of 72 months
33. Mr Ong is a 65-year-old Singaporean concerned about paying his medical expenses in the
event of suffering from any severe disability. However, he was not eligible to join the
Eldershield scheme when it was launched in September 2002 because he had pre-existing
disability. If Mr Ong suffers a severe disability and assuming that his per capita household
income is S$2,000, he will qualify to receive a payout of _____________ under the Interim
Disability Assistance Programme for the Elderly.
A. S$150 per month for up to 72 months

B. S$150 per month for up to 60 months
C. S$250 per month for up to 72 months
D. S$250 per month for up to 60 months

34. Set up by the Government in April 1993, ____________ is an endowment fund to assist needy
Singaporeans who face financial difficulties with their healthcare bills.
A. Medifund
B. MediShield Life Fund
C. Community Health Assist Scheme
D. Pioneer Generation Disability Assistance Scheme
35. Mr Osman is a 35-year-old Singaporean. He was admitted to a public hospital on 1 December

2015 for a duration of 3 days during which he underwent an appendix surgery. The total
claimable amount under Medishield Life for Mr Osman’s surgery was S$3,000, with a deductible
of S$1,500.
The co-insurance payable by Mr Osman under Medishield Life is:
A. 3%
B. 5%
C. 10%
D. 15%
36. Ms Ang is a 40-year-old Singaporean who joined the ElderShield scheme and became disabled
resulting solely from an accident in the first 60 days of coverage.
Which one of the following statements regarding the payment of Ms Ang's ElderShield benefits
is TRUE?
A. The insurer will pay the benefits, as there is no waiting period.
B. The insurer will pay the benefits, as the waiting period does not apply.
C. The insurer will pay the benefits, as the disability occurred after the waiting period of 30
days.
D. The insurer will terminate the policy and refund all premiums paid, as the disability
occurred within the waiting period of 90 days.
37. One of the purposes of the Insuring Clause in a typical Health Insurance policy serves to:
A. restrict the coverage to the country where the policy is issued

B. set forth the conditions under which the benefits are payable
C. determine the rights of both the insured and the insurer in the contract
D. state that the policy shall not be in force, unless the premium is paid

38. A type of Health Insurance contract that gives the insurer the right to refuse to renew is the
_________ policy.
A. non-renewable
B. annually renewable
C. optionally renewable
D. guaranteed renewable
39. A policy owner who has just bought a Critical Illness Insurance policy, with built-in death
benefits payable, wishes to make a nomination of beneficiaries, such that he still retains the
policy ownership and is free to change, add or remove them without their consent. Which one
of the following nominations should he make?
A. Trust Nomination.
B. Revocable Nomination.
C. Irrevocable Nomination.
D. Recoverable Nomination.
40. Which one of the following is NOT a key factor used by the insurer in the premium computation
of a Health Insurance product?
A. Investment income.
B. Mortality experience.
C. Scope of benefits covered.
D. Modes of premium payment.
41. Health Insurance underwriting is concerned primarily with:
A. morality
B. morbidity
C. persistency
D. level of attrition
42. If Mr Tan states in his Critical Illness Insurance proposal form that he is receiving treatment for
high blood pressure, the underwriter will MOST LIKELY require a/an:
A. financial report
B. blood profile analysis
C. attending physician’s statement
D. supplementary lifestyle questionnaire

43. In underwriting most types of Health Insurance policies, the proposer’s __________ is NOT a
key consideration by an underwriter.
A. age
B. avocation
C. occupation
D. financial situation
44. The size and stability of the proposer’s earnings will be an important factor for the underwriting
of __________ Insurance.
A. Long-Term Care
B. Hospital Income
C. Medical Expense
D. Disability Income
45. Notice No: MAS 120 comprises both mandatory requirements and best practice standards on
the disclosure of information and provision of advice to policy owners for:
A. life policies only

B. accident and health (A&H) policies only
C. A&H policies and life policies that provide A&H benefits
D. A&H policies, Investment-Linked policies and Universal Life policies
46. For the purpose of Notice No: MAS 120, the definition of an accident and health insurance
intermediary includes a:
A. captive insurer
B. direct reinsurer
C. direct insurance broker
D. direct reinsurance broker
47. Under Notice No: MAS 120, Part I of the Mandatory Requirements states that no direct insurer
shall use the word “Shield” in the name, description or title of any accident and health policy
issued by the insurer, unless that policy is a __________ policy.
A. Medisave-approved
B. Medifund-approved
C. MediShield-approved
D. MediShield Life-approved

48. Under Notice No: MAS 120, if a prospective client refuses to accept an Accident and Health
(A&H) product recommended by his insurance broker, but requests to buy another type of A&H
product instead, the insurance broker should:
A. get the client to sign a disclaimer form, before going ahead with his request
B. ignore the client’s request and file a report with the insurer to whom the insurance broker
is representing
C. go ahead with the client’s request, but document his decision and inform him that he is
responsible to ensure that the product selected is suitable
D. request the client to seek the advice of another insurance broker, to make sure that the
product is most suitable for him
49. Under Notice No: MAS 120, an Accident and Health Insurance intermediary that is involved in
providing advice on Health Insurance policies to policy owners does NOT need to:
A. conduct needs analysis

B. perform criminal due diligence
C. perform “Know-Your-Client” analysis
D. conduct a proper documentation and record keeping exercise
50. As a Financial Adviser Representative (FA Rep), which one of the following situations will be
considered as needs selling?
A. The FA Rep’s relationship with the prospective client depends on how well the client likes
his product.
B. The FA Rep helps the prospective client to uncover his needs and recommend suitable
solutions for him.
C. The FA Rep creates the pressure to buy, and the prospective client does not understand
why he has to buy the product.
D. The FA Rep assumes that the prospective client needs his product, and as such, he
makes a detailed recommendation to the prospective client.

Answers to Mock Paper
1 A 26 C
2 C 27 A
3 C 28 A
4 B 29 B
5 C 30 B
6 A 31 B
7 C 32 D
8 D 33 A
9 C 34 A
10 D 35 C
11 D 36 B
12 B 37 B
13 A 38 C
14 B 39 B
15 A 40 B
16 C 41 B
17 C 42 C
18 A 43 D
19 C 44 D
20 B 45 C
21 A 46 C
22 D 47 A
23 B 48 C
24 C 49 B
25 A 50 B

Health Insurance Strictly For Internal Use Only
HEALTH INSURANCE
(6th Edition)
Mock Exam

Produced in collaboration with Julia Sim. Based on 6th Edition Text.(Version 1.1)(12/6/17)
Health Insurance Mock Exam 1 Strictly For Internal Use Only
Mock Exam 1
C1/2.3
1. Ministry of Health has put together a "Healthcare 2020" Masterplan to improve healthcare
services for Singaporeans. Which of the following is not a strategic objective of this plan?

B. It is to enhance quality of healthcare.
C. It is to enhance accessibility of services.
D. It is to ensure transfer of healthcare costs to the insurers.
C1/4.3
2. Which of the following is not true regarding universal coverage provided by the Singapore
Government?.
A. Do not provide 100% subsidy to avoid over-consumption.

B. Compulsory healthcare savings through Medisave.
C. Risk Pooling via MediShield Life and Medifund.
D. Endowment fund set up for needy Singaporeans.
C2/2.9(a)
3. Daily Room and Board Charges are covered under Inpatient Expenses of a Medical
Expense Insurance Policy. Which of the following is NOT covered under Daily Room and
Board Charges?.
A. Accommodation
B. Meals
C. General Nursing Services
D. Medicines and drugs
C2/2.9(d)
4. Under the Medical Expense Insurance, Hospital Miscellaneous Expenses refers to the
services and supplies (other than room and board and general nursing care) furnished during
a hospital stay, and will usually include :
A. Short-stay ward
B. Operating room expenses
C. Intensive care unit
D. Surgical implant and prosthesis charges
C2/2.22
5. Mr. Tan is 45 years old and works as a bus driver. He lives in a one-room flat. Recently he got
into an accident and was hospitalised for 5 days in a "C" class ward of a government hospital.
The total hospital bill of $3000 as charged by the hospital is fully reimbursed by the insurer.
Which of the following insurance policy is most likely the one that he has purchased?
A. Disability Income Insurance

B. Hospital Cash Insurance
C. Medical Expense Insurance.
D. Critical Illness Insurance

C2/3.6
6. Mr. Lim is buying a policy for himself and his wife and 2 children of the same premium each.
What is the premium payable given the following?.
Mr. Ang’s premium $182.31

Mrs. Ang’s premium $227.89
1 child’s premium $102.50
A. $512.70
B. $584.44
C. $615.20
D. $487
C2/6.1
7. The coverage for an insured person will terminate under Medical Expense Insurance
when____________.
A. the total amount of claims has reached the annual limit.

B. when the insured attains the maximum age of entry.
C. when the insured enters full time military service.
D. when the insured enters National Service Reservist Training.
C2/3.39
8. Paul has purchased a Medical Expense Insurance from Lion Insurance Company with the
following features:
Waiting Period: 90 days

Minimum Hospital Confinement Period : 72 hours
Which of the following scenarios would enable him to make the claim?
A. His right eye was injured and was confined for 24 hours at the hospital.
B. He was hospitalized for high fever 15 days after inception of the policy.
C. He fractured his ankle 12 days after the policy inception and was hospitalised for five
days subsequently.
D. He was diagnosed with cancer 2 months after policy inception.
C3/3.3
9. One advantage of contributory Group insurance plan is that the employer _________.
A. has greater control of the benefit structures and provisions.

B. has lower administrative work involved.
C. pays only part of the costs to provide the benefits.
D. does not need to monitor payroll deduction.

C3/3.4 (table)
10. The most important factor for the underwriter when underwriting Group Insurance is
_____________.
A. Gender & age.

B. Health & financial status.
C. Smoking habit and family history.
D. All of the above .
C3/4.12
11. Which of the following is NOT TRUE of the employer to qualify for Transferable Medical
Insurance Scheme (TMIS)?
A. must have a group size of 11 or more employees.

B. to take up a Group Medical Expense Insurance Plan.
C. insure at least 50% of its local employees.
D. pay 50% of the premium for the Group Medical Expense Insurance coverage.
C4/3.2 , Table 4.1

12. Which of the following characteristics of Disability Income Insurance is/are True?.
A. Maximum sum assured is based on the salary.

B. Choice of deferred period.
C. Partial disability is not covered.
D. Incorporated into life policies.
C4/4.1, Eg 4.3
13. Andrew , an engineer became disabled and unable to go to work. Compute his total Disability
Income Benefit. Given the following details:
Escalation Benefit : 3%
Monthly Income : $5,000
Monthly Expense : $3,000
No of years : 30 years
A. $1,141,809
B. $1,712,714
C. $2,140,893
D. $2,854,524
C4/6.16
14. In the event of a claim under Disability Income Insurance, Limitation of Benefit Clause will
not affect which type of payment?.
A. Rental Income.
B. Salary from ex-employer.
C. Workman Compensation.
D. TPD benefits under Life Insurance Policies.

C4/8.5
15. In underwriting a Disability Income Insurance policy, which of the following factor is not a
underwriting decision?.
A. Benefit amount
B. Occupation
C. Deferred or elimination period
D. Limitation of disability benefit.
C5/2.3
16. Which of the following regarding Long Term Care Insurance (LTCI) is true?
A. LTCI is meant to meet costs of care to a special group of elderly who is physically
impaired and unable to function independently.
B. The young and healthy need not buy LTCI.
C. It is not governed by the Over Insurance Provision Clause.
D. Premiums are based on age band basis.
C5/3.1(a)
17. “Service Based” Long Term Care Insurance Policy describes________________.
A. Indemnity Method.
B. Pays if meet benefit trigger.
C. Pays 100% if unable to perform 4 out of 6 ADLs.
D. Level Premium basis.
C5/3.5 (c)
18. Which of the following is NOT an Activity of Daily Living?
A. Continence
B. Morbidity
C. Dressing
D. Transferring
C5/3.1(a)
19. Long Term Care Insurance that pays a benefit when the insured incurs costs for home care
and satisfies the benefit trigger is the ____________ policy.
A. fee-based
B. service-based
C. disability based
D. benefit-based

C6/5.8 (g)
20. Mr. Tan is covered under his company's Group Dental Insurance. Which of the following
benefits, Mr. Tan cannot claim from this policy?.
A. Scaling and polishing of teeth.

B. Wisdom tooth extraction.
C. Pre-existing dental conditions.
D. Replacement of broken dentures.
C6/2.9(m)
21. Under what situations will Critical Illness Insurance cover not be terminated?.
A. Policy is converted into an Extended Term Policy.

B. A critical illness claim has been made.
C. Policy owner exercises Paid Up Option under the non forfeiture options.
D. Policy lapses due to non-payment of premium.
C6/3.2
22. Richard bought a Hospital Cash Income Insurance Policy, with these policy details:
Daily Benefit : $100

Max of 180 days per hospitalization
Lifetime Limit : 1000 days
He was hospitalized for a total 185 days for car accident injury. Calculate the total maximum
amount Richard can claim from this policy.
A. $100,000
B. $18,500
C. $18,000
D. $180,000
C6/3.11(f)
23. Which of the following regarding Standalone Hospital Cash Insurance is false?.
A. Free death benefit

B Triple payment if hospitalized overseas due to accident
C. Double payment if in Intensive Care Unit
D. Get well benefit
C7/3.2
24. Which of the following is NOT a component of Managed Healthcare?.
A. Accessibility
B. Cost
C. Quality of care
D. Capitalization

C7/3.8(a)
25. Which of these method, the Managed Healthcare Organization pre-pay the providers a
fixed amount for each member’s medical care usually on a monthly basis?.
A. Capitation
B. Discounted-fee-for-service
C. Salary
D. Fee schedule
C7/4.10,4.11
26. In this HMO Model, the doctors and healthcare providers are not hired directly. A large
group of medical practice will provide medical care and the group is responsible for obtaining
the physicians necessary to provide the contracted services and compensating its physicians.
Which Model is this?.
A. Staff Model HMO

B. Group Model HMO
C. Independent Practitioners Association (IPA) HMO
D. Network Model HMO
C7/6.2
27. Managed Healthcare Insurance offers some benefits, which of the following is Not True?
A. Primary Care
B. Preventive Care
C. Emergency Care
D. Inpatient Care
C8/2.5
28. In January 2009, means testing in public hospitals was introduced to better target the
subsidies . Which of the following regarding means-testing is false?.
A. Subsidy received depends on class ward and income of the patient.

B. It is used to target B2 & C class wards in a public hospital.
C. Medical benefits received are based on the monthly income of the patient.
D. It is not used for day surgery and Accidental & Emergency (A & E) services.
C8/3.3
29. Medisave can be used to pay for medical expenses for all CPF members except
________unless they are Singapore Citizen or Singapore Permanent Resident.
A. Grandparents
B. Children
C. Parents
D. Non of the above

C8/4.1
30. Which of the following regarding Medisave and MediShield Life is/are true?
A. Medisave is a saving scheme and MediShield Life is a basic healthcare insurance

scheme that covers all Singaporeans Citizens and Singapore PRs for life.
B. Both schemes are opt out scheme.
C. Both are low cost basic healthcare medical insurance schemes.
D. Both have deductibles.
C8/5.5
31. Policyowner is covered under an Integrated Shield Plan(IP) with exclusions on his entire IP,
when MediShield Life is launched. Which of the following statements is true?.
A. He will retain the exclusions on the entire IP .

B. He will be fully covered without exclusions for his entire IP.
C. He will be fully covered up to MediShield Life benefits, and the exclusions will only apply
to the Additional Private Insurance component of his IP.
D. Depending on the type of medical condition his exclusion is on, he may or may not be
fully covered up to the MediShield Life benefits. The exclusion will still apply to the
Additional Private Insurance component of his IP.
C8/5.16
32. Bob is 50 years of age this year. He wishes to calculate the amount of premiums that he
must pay by cash. Given that he has bought the following:
MediShield Life: $450

Integrated Shield Plan: $150
Co-insurance and deductibles riders: $500
ElderShield400: $100
ElderShield Supplements: $750
The Additional Withdrawal Limit for IP premiums are as follows:

MediShield Life: No limit
Integrated Shield Plan
Age Next Birthday
40 years and below : $300
41 to 70 years : $600
71 years and above : $900
ElderShield 400: No limit
ElderShield Supplements: $600
How much premiums must Bob pay by cash?
A. $400
B. $500
C. $650
D. $750

C8/5.16
33. Richard, 55 years old, wishes to use his CPF Medisave to finance his Integrated Shield plan
with an annual premium of $2,500; ElderShield with an annual premium of $300; and
ElderShield Supplements with an annual premium of $1,000.
Assuming the applicable withdrawal limits (per person per year) for the following Medisave
Approved Medical Insurance plans are:
MediShield Life : No limit
Integrated Shield Plan : $600 (age 41 to 70 years old)
ElderShield: No limit
ElderShield Supplements: 600
Calculate the total amount Richard will have to pay in cash after withdrawing the maximum
amount from his Medisave?.
A. $0
B. $1,200
C. $2,300
D. $2,900
C8/7.10
34. Interim Disability Assistance Program For The Elderly was launched by the Government to
take care of needy Singaporeans who were not eligible to join ElderShield Scheme because
of reasons of ____________.
A. their age
B. health
C. age and pre-existing disability
D. All of the above.
C8/5.32
35. John has a MediShield Life and an Integrated Shield Policy (IP). He is hospitalized , his
payout based on MediShield Life is $5,000, and his payout based on the full IP benefits is
$8,000. What is eventual payout that John will receive?
A. $5,000 or $8,000 whichever is lower

B. $5,000 or $8,000 whichever is higher
C. $13,000 ($5000+ $8,000), pay first, claim later.
D. $3000
C9/3.3
36. Which of the following section in a Health Insurance Contract must the adviser goes through
with the client to ensure no typographical error?.
A. Policy Schedule
B. Insuring Clause
C. Entire Contract Clause
D. Benefit Provision

C9/5.36
37. Under the Change of Occupation provision, the insurer is permitted to change which of the
following when the insured changes to a less hazardous occupation:-
A. increase the maximum benefit amount

B. reduce the premium rate
C. decline the insurance coverage
D. cancel the policy
C9/9.4
38. What are examples of endorsements found in a Health Insurance Policy Contract?
A. Promise to pay by insurer

B. Restrict the scope of coverage
C. Actively At Work
D. Legal actions which insured can take against insurer
C10/2.3
39. When pricing Health Insurance products, insurers will charge females a ________rate than
males because _____________.
A. lower; women statistically have a higher longevity rate than men.

B. lower; the medical costs for women are statistically lower than men.
C. higher; women statistically have a lower longevity rate than men.
D. higher; the medical costs for women are statistically higher than men.
C10/3.15
40. The participation by employees in the plan is an important parameter in premium rates. If the
participation is _________, there will be a greater chance that a _________ than normal
proportion of unhealthy lives seeking coverage.
A. low; lower
B. high; higher
C. low; higher
D. good; greater
C11/2.1
41. Underwriters help the insurer assess the risk and determine whether or not to accept an
application, and if so, on what terms it will offer. Hence the role of underwriters are to
______________.
A. help to protect the insurer against anti-selection and in the preservation of the insurer’s
reserves.
B. ensure that the premium charged corresponds with the risk involved.
C. ensure the re-insurance limits will not be exceeded.
D. ensure that the premium charge is fair.

C11/3.19
42. Underwriters look particularly for applicant’s earning and overall financial situation in
underwriting:
A. Long Term Care Insurance

B. Disability Income Insurance
C. Critical Illness
D. Managed Health Care
C11/3.20
43. Cognitive assessment is normally required during the underwriting stage for which plan?
A. Long Term Care Insurance.

B. Basic Medical Expense Insurance.
C. MediShield Life.
D. Disability Income Insurance.
C11/3.21
44. Which of the following factor is most important for underwriting Critical Illness Insurance?
A. Family history.
B. Overall financial condition.
C. Cognitive impairment.
D. Age and gender.
C12/2.1
45. MAS Notice No: MAS 120 comprises both mandatory requirements and best practice
standards on the disclosure of information and provision of advice to policy owners for:
A. life policies only

B. accident and health (A&H) policies only
C. A&H policies and life policies that provides A&H benefits
D. A&H policies, Investment- Linked policies and Universal Life policies
C12/41
46. Under MAS Notice No: MAS 120, if a prospective client does not want to accept an Accident
and Health (A&H) product recommended by the A&H intermediary but request to buy another
type of A&H product instead, the A&H intermediary should, _________________.
A. get the client to sign the disclaimer form, before going ahead with the request.
B. ignore the client's request and file a report with the insurer.
C. go ahead with the client's request but document client's decision and inform him that he
is responsible to ensure that the product selected is suitable.
D. proceed with client's request but A&H intermediary must ensure the product is
suitable.

C13/3
47. An insurance representative is marketing a Health Insurance product to her friend, John.
Which of the following best illustrates needs selling by the representative?.
A. Representative offers a rebate of 50% on the commission earned if John buys the
product.
B. Representative explains how this product addresses the concern of John as stated
from his fact-find form.
C. Representative focuses on the features of the product, explaining clearly to John, if he
should be hospitalized and details on how to claim.
D. Representative discloses for the John's benefit that the discount for the product will end
in a week's time.
C13/3.3(b)
48. Mrs. Tan is keen to purchase Medical Insurance Product. She knows the product well and
the coverage needed. In this case, she comes under _________of the Fact-Find Document.
A. Application Type 1
B. Application Type 2
C. Application Type 3
D. Application Type 4
C13/4.13 Eg 13.3
49. Calculate Maintenance Cost given these assumptions:
Monthly income needed = $1,500

No. of years income needed = 21
Rate of return = 5%
Inflation rate = 2%
Existing Life Insurance = $150,000
A. $350,139
B. $285,795
C. $135,794
D. $87,705
C14/2.5
50. The most suitable product for meeting maintenance cost is _____________.

B. Dread Disease
C. Hospital Cash Insurance
D. Managed Healthcare Insurance

Mock Exam 1 Answers
Question Answer Question Answer

1. D 26. B
2. C 27. D
3. D 28. C
4. B 29. A
5. C 30. A
6. B 31. C
7. C 32. C
8. C 33. C
9. C 34. C
10. A 35. B
11. D 36. A
12. B 37. B
13. C 38. B
14. D 39. D
15. B 40 C
16. C 41. B
17. A 42. B
18. B 43. A
19. B 44. A
20. D 45. C
21. C 46. C
22. A 47. B
23. A 48. C
24. D 49. C
25. A 50. A
Workings
Qn 6
Ans:
$182.31 + $227.89 + $102.5 + $102.5 X 95% (enjoy family discount of 5%) = $584.44
Qn 13
Ans :
$5000 x 75% = $3750
$3750 X 12 x *47.5754 = $2,140,893
* 47.5754 (factor from Table A1 – 3%; 30 years)
Qn 22
Ans: Lifetime limit of 1000 days X $100 per day = $100,000
Qn 49
Ans:
$1500 X 12 = $18,000
$18,000 X 15.8775 (table A2– 21 yrs; 3%) = $$285,794
$285,794 – $150,000 (life insurance )= $135,794

Mock Exam 2
C1/2.3
1. Ministry of Health (MOH) has put together a "Healthcare 2020" Masterplan to improve
healthcare services for Singaporeans. The focus is on 3 strategic objectives, namely
_______________.
A. enhancing accessibility, quality and wide network for healthcare.

B. promoting health, prevent and reduce illness.
C. providing good, affordable and quality healthcare.
D. enhancing accessibility, quality and affordability of healthcare.
C1/3.1
2. Healthcare system in Singapore consists of namely:
A. Primary Healthcare Services, Hospital Services, Traditional Chinese Medicine.

B. Western Medical Science and also Traditional Chinese Medicine.
C. Primary Healthcare Services, Hospital Services, Intermediate and Long Term Care
Services.
D. Traditional Chinese Medicine, Primary Healthcare Services and Intermediate and Long
Term Care Services.
C2/3.25
3. Mr. Chen has a medical expense insurance policy that is subject to deductible, co-insurance
and pro-ration factor. He was hospitalized and the net claimable amount is $3,000.
However he was only able to claim $2,400 from the insurer. What is the possible reason?.
A. He has to pay a pro – ration factor of 20%

B. He has to pay a deductible of $600
C. He has to pay a co – insurance of 20%
D. He was unable to enjoy a family discount of $600.
C2/3.14
4. The three expense participation methods used by insurers does not include____________.
A. Deductibles.
B. Co-insurance
C. Pro- ration factor
D. Co-ordination of benefits
C2/3.14
5. Insurer may not give full reimbursements of medical expenses because of:
A. Underwriting limitations
B. Deductible & Co-insurance
C. Co- Ordination of Benefit Clause
D. Different subsidy level

C2/3.19
6. Deductible is a flat dollar amount of medical expenses that a policy owner must pay out of his
own pocket, before insurer will make any payment. Which of the following statement is
most TRUE?.
A. per disability/per year deductible is more restrictive as compared to per disability/per

claim deductible.
B. the same sickness or injury within the same policy year applies to “per disability/per
claim deductible”.
C. per annum deductible includes a variety of covered sickness or injuries within a policy
year.
D. under per disability/per year deductible, the insured will have to bear the deductible each
time he makes a claim regardless of the number claims made within the same year.
C2/3.22
7. Nelson Tan has a medical expense insurance policy which has a deductible of $2000
per policy year from 1st Jan to 31st Dec 2013. He was warded for high fever in 1st Apr
and incurred a bill of $1200 for a two day stay in the hospital. Four months later, he was
treated in hospital due to a fracture of the leg and incurred a hospital bill of $2100. How much
can Nelson claim from the insurer under per annum deductible?
A. $$100
B. $1300
C. $2000
D. $3300
C2/3.28
8. Policyowner who pays a lower premium on a lower MEI plan should be encouraged to use the
services on the selected plan, otherwise the benefit payable is reduced. This is the working
of:
A. Limitation Clause
B. Deductible
C. Co-Insurance
D. Pro-ration factor
C3/2.2(b)
9. Which of the following is NOT a feature of Group Medical Insurance Policy?.
A. Policy continues after one employee makes a claim.

B. Underwriting requirements are not waived.
C. There are many life insureds in one master contract.
D. The policy covers all employees below the statutory retirement age.

C3/3.2, Table 3.1

10. Mr. Tan would like his wife to be included under his company’s Group Medical Insurance
Policy. What would the commencement date of cover for Mrs. Tan be?.
A. Anytime within 30 days after marriage.

B. Anytime within 15 days after marriage.
C. Anytime within the half year after marriage.
D. Anytime as and when Mr. Tan apply for her to be included and cover approved by
underwriting.
C3/4.5
11. Which of the following describes Portable Medical Benefit Scheme (PMBS)?.
A. It rides on Medisave/ Medishield framework , as employees makes an additional

monthly contribution to his medisave account to buy medical insurance.
B. Employees are medically insured even though he may be unemployed or is in between
jobs.
C. To be eligible for the tax deduction, the scheme must cover 100% of all local employees,
as at the first day of financial year being assessed.
D. For part- time employees, the monthly Medisave contribution should be based on 2% of
their actual salary.
C4/5.6
12. “The insured’s inability to perform any gainful occupation or a similar occupation for which he
is reasonably suited by reason of education, training or experience” refers to:
A. Any Occupation .
B. Own Occupation
C. Specific Occupation
D. Modified Own Occupation
C4/6.12, Eg 4.3
13. David has a monthly income of $6,000 and has bought a Disability Income policy at 75% of
his monthly income with a 3% escalation benefit. He is disabled and made a claim
successfully on 1-1-2000. What is the amount that he will receive on the 1-3-2001?.
A. $4,500
B. $6,000
C. $4,635
D. $4,770
C4/6.9
14. Rehabilitation Expense Benefit under Disability Income Policy does not refer to payment for:
A. Medical Aids
B. Training Courses
C. Workplace Modifications
D. Partial Disability Benefit

C4/8.11
15. The deferred period for Disability Income is an important factor to the underwriter in that it:
A. assesses any moral hazard involved.

B. meets medical requirements.
C. complies with the limitation of benefits clause.
D. determines the occupational risk of the insured.
C5/3.1(a)
16. If you know that your client has Long Term Care Insurance, you should also find out whether,
A. he has other sources of disability income.

B. the deferred period is right for him.
C. the benefits payable are on a serviced-based basis.
D. the policy has deductible and co-insurance features.
C5/3.2(b)
17. Which of the following is by far the most common type of Long Term Care Insurance Plan
found in Singapore ?.
A. Monthly Benefit Policy

B. Annually Benefit Policy
C. Quarterly Benefit Policy
D. Daily Benefit Policy
C5/4.2(c)
18. When a person requires an assistive rehabilitation device, which of the following benefits
available under a Long Term Care plan could provide it?.
A. Rehabilitation Expense Benefit

B. Extended Care Benefit
C. Surgical and Prosthesis Device
D. Financial Assistance with Adaptation
C5/9.1(e)
19. The following are exclusions under Long Term Care Insurance Policies EXCEPT:
A. All pre-existing conditions, which were not fully declared and described by the insured at
the time of application.
B. Alcoholism and drug abuse.
C. Any form of Acquired Immune Deficiency Syndrome (AIDS) or infection
by any Human Immunodeficiency Virus (HIV).
D. Self inflicted injury.

C6/2.33(d)
20. Which event by the policy owner will cause critical illness cover to be terminated under a
Critical Illness Insurance Policy?.
A. When the policyowner exercise paid up option under Non forfeiture option.
B. When the policy is converted into an Extended Term Insurance Policy.
C. When the insured is diagnosed with a critical illness.
D. When an invalid critical illness claim has been made.
C6/2.13, 2.14
21. 100% Acceleration Dread Disease Policy is MOST suitable for clients who:
A. has dependents.
B. has sufficient life insurance.
C. disability income insurance.
D. wish to stay in A class or B1 class wards when hospitalized.
C6/5.11(d)
22. Cover for each individual insured employee under a Group Dental Care Insurance Policy will
automatically terminate under which event?.
A. Insured enters full time military service.

B. Insured exercises one of the non forfeiture options.
C. Insured could claim from other sources like Workmen Compensation.
D. Insured reaches age 60.
C6/3.7(a)
23. Larry bought a Hospital Cash Insurance Policy on 1 Jan 2016, with a waiting period of 30
days. He was hospitalized on 28 Jan 2016 . Upon the happening of which of the following
situations can he claim from the insurance company?.
A. Kidney failure
B. Miscarriage
C. hip fracture
D. None of the above as he was unable to claim
C7/3.2
24. Which component of managed healthcare is not used to contain and control healthcare
expenditure?
A. Accessibility
B. Cost
C. Quality of Care
D. Wide healthcare coverage

C7/3.4,3.5
25. Primary care physician in Managed Healthcare Plan is NOT known as _____________.
A. Backbone of Managed Healthcare plans

B. Gatekeepers
C. Personal Physician
D. Specialist
C7/3.8
26. To control increasing medical costs, which of the following is not used by Managed
Healthcare Organization?.
A. Capitation
B. Salary
C. Profit Sharing
D. Fee Schedule
C7/4.21
27. Which of the following best describes Preferred Provider Organisations(PPOs) under
Managed Healthcare Plans?.
A. PPOs are gatekeepers.

B. PPOs allow clients to see specialist with referrals.
C. PPOs require greater “out of pocket” payments from members.
D. PPOs allow clients to choose to stay in the network or outside the network at point of
service.
C8/3.5
28. Contributions to the Medisave account are subject to a maximum amount, known as Basic
Healthcare Sum (BHS). Which of the following regarding BHS is most true?.
A. BHS is formerly known as Medisave Minimum Sum.

B. Amount above BHS can be withdrawn.
C. At the age of 55, if the CPF member has already met his full Retirement Sum, any
excess cannot be withdrawn as cash.
D. Amount in the Medisave account up to the BHS cannot be withdrawn as cash.
C8/3.13e(iv)
29. Medisave can be used to pay for which expenses under Chronic Disease Management
Programme?.
A. Wheelchairs
B. Prostheses
C. Drugs and Medications (including non-standard drugs)
D. All of the above

C8/4.22
30. For families needing assistance with their premiums even after all subsidies are given and
Medisave use are not sufficient, which subsidy can be tapped further?.
A. Transitional Subsidies
B. Pioneer Generation Subsidies
C. Premium Subsidies
D. Additional Premium Support Subsidies
C8/4.24
31. MediShield Life Schemes pays on a _____________, subject to _______________.
A. as charged basis ; deductibles and co-insurance.

B. as charged basis ; deductibles , co -insurance and pro-ration factors.
C. reimbursement basis; deductibles, co-insurance and pro-ration factors.
D. reimbursements basis ; deductibles and co-insurance but no pro-ration factors.
C8/4.27
32. Mary a Singapore Citizen is covered under MediShield Life for stay in B2 class ward in a
public hospital. Upon her hospitalisation she chose to stay in a Class A ward in a private
hospital. Which factor(s) will particularly caused Mary to pay out more from her own pocket?.
A. Deductible
B. Co-insurance
C. Pro-ration
D. All of the above
C8/4.28, Eg 8.1
33. Mr. Wong , 60 years old, hospitalised in a C Class Ward. Details as follows:
• Bill after government subsidies = $8,000

• All expenses within MediShield Life claim limits.
• Deductible = $1,500
• Co-insurance applies on the following rates:
From $0 to $5000 - 10%
From $5,001 to $10,000 - 5%
More than $10,000 - 3%
Calculate the co-insurance payable under MediShield Life.
A. $325
B. $575
C. $500
D. $975

C8/5.13
34. The government has worked with IP insurers to develop the Standard IP. Which of the
following is true of the Standard IP?.
A. It is a "no-frills" product targeted at covering B2 ward hospital bills and selected

outpatient treatments.
B. From 1 May 2016, all insurers are required to sell the Standard IP.
C. The benefits are identical across all IP insurers, and they are regulated under the
Insurance Act (Cap 142) under the Scheme.
D. It has co-insurance and deductible components.
C8/5.19
35. Which of the following statements about riders in Integrated Shield Plans (IP) is True?.
A. IP rider premiums can be paid for using Medisave and/or cash.

B. IP riders may cover the co-insurance and /or deductible portions that IPs do not cover.
C. IP riders are part of IPs and is approved by the Ministry of Health.
D. IP riders premiums are the same across all age groups.
C9/4.1
36. Which of the following section in a Health Insurance Policy contract is often viewed
as the insurer’s promises to pay under the conditions specified in the policy?.
A. Operative clause
B. Policy schedule
C. Generation conditions
D. Endorsements
C9/5.2
37. All insurance contracts have an "Entire Contract Clause”. In a Health Insurance Contract,
which of the following make up the entire contract between the insured and the insurer?.
A. Policy Document and Proposal Form.

B. Policy Document and Fact Find Form.
C. Policy Document and Insuring clause.
D. Policy Document and Schedule of Benefits.
C9/5.15
38. The Renewal Provision in a Health Insurance Contract describes:
A. Insurer’s right to increase premium on policy.

B. Insured’s right to renew his policy under certain conditions.
C. Circumstances which the insurer has the right to offer a change in plan.
D. Insured’s right to renew at certain dates.

C10/2.3
39. What is the key factor for Health Insurance Pricing?
A. Age
B. Morbidity
C. Mortality
D. Gender
C10/3.13
40. The following statement about parameters in pricing of Health insurance is true?
A. Increase in proportion of females in a group will reduce the premiums.

B. Increase in morbidity experience will reduce premiums.
C. Increase in persistency will decrease premiums.
D. Increase in participation rate will increase premiums.
C11/3.9
41. Medical Aspects of Underwriting requires the consideration of___________.
A. Financial Factors
B. Current Physical Condition
C. Occupational Factors
D. Age Factors
C11/3.34
42. Moratorium Underwriting offers the proposers a few advantages except ____________.
A. Insured will have the certainty as to what is covered at the point of joining, rather than at
claim.
B. Insured need only provide basic information about himself.
C. Need not disclose the details of medical history.
D. Pre-existing conditions is covered after a few years, should it recur later, subject to
conditions.
C11/6.5
43. John, a proposed insured declared in the proposal form that he is going for a surgery. The
underwriter will likely _________________.
A. decline the proposal

B. postpone the proposal
C. charge more premium
D. apply specific exclusions

C11/6.4(ii)
44. For which of the following is ‘extra premiums’ NOT commonly used for sub-standard risks?
A. Disability Income.
B. Medical Expense Insurance.
C. Long Term Care Insurance.
D. Dread Disease Insurance.
C12/15
45. Under the Disclosure Requirements an A&H Insurance Intermediary shall upon request of the
insured, disclose in writing which of the following?.
A. All remuneration
B. Commission
C. Fee and other benefits it has received or will be receiving
D. All of the above
C13/3.3(f)
46. What serves as a starting or reference point for the advisers to recommend further A & H
insurance recommendations to their clients?.
A. Client’s existing Health Insurance Policies

B. Client’s pay increase
C. Client’s promotion
D. Client’s affordability
C13/4.2
47 Why is an emergency fund important for the client?.
A. act as a safeguard against retrenchment

B. act as a fund to invest in future speculative assets for retirement
C. to help purchase big ticket items such as down payment for a house.
D. to help purchase more expensive policies to invest for future retirement.
C13/4.13 Eg 13.3
48. Mr. Tan is aged 30. He has income and expenditure of $5,500 and $2,500 respectively. He
wants to maintain his income to age 60 should he be disabled. Assuming that the interest
rate is 4% and inflation is 2%, what is the maintenance cost?.
A. $1,507,732
B. $822,399
C. $685,332
D. $529,135

C14/3.5
49. For a prospective client buying a Group Term Life Insurance for the first time, which method
does not take into account the length of service of the employees?.
A. Number of times of the employee's basic salary.

B. According to rank.
C. Both A & B
D. None of the above
C14/2.7
50. Mrs. Tang is a housewife. Which of the following policy is MOST suitable for meeting the
maintenance costs for Mrs. Tang ?.
A. Personal Accident Insurance Policy

C. Long Term Care Insurance
D. Disability Income Insurance

Mock Exam 2 Answers

1. D 26. C
2. C 27. C
3. C 28. D
4. D 29. C
5. B 30. D
6. C 31. C
7. B 32. C
8. D 33. C
9. B 34. D
10. A 35. B
11. B 36. A
12. D 37. A
13. C 38. A
14. D 39. B
15. A 40 C
16. C 41. B
17. A 42. A
18. D 43. B
19. C 44. B
20. B 45. D
21. B 46. A
22. A 47. A
23. C 48. C
24. D 49. B
25. D 50. A
Workings
Qn 7
Ans: $1200 + $2100 - $2000 = $1,300
Q13
Ans: $6000 X 75% = $4500
$4500 + (3% X$4500 ) = $4635
Qn 33
Ans
Total Bill = $8000
less deducible = $1,500
Claimable amount = $6,500
Co- insurance is the percentage of claimable amount ($6,500) which she must pay on top of the
deductible.
$1,501 to $5,000 - 10% x $3,500 = $350
$5,001 to $8,000 - 5% x $3,000 = $150
Co - insurance payable = $350 + $150 = $500
Qn 48
Ans: $2500 x 12 = $30,000 X 22.8444 (table A2– 2%, 30yrs)
= $685,332.

Mock Exam 3
C1/2.7
1. Ministry of Health move to enhance and strengthen primary healthcare providers such as
polyclinics and general practitioners (GPs) and constructing new polyclinics is an example
of______________.
A. enhancing accessibility
B. enhancing quality of care
C. ensuring healthcare remains affordable.
D. ensuring wide healthcare network.
C1/3.11
2. Intermediate and Long Term Care (ILTC) services are for those who need further care and
treatment after discharge from the hospital, who may need assistance with their activities of
daily living. This can be through :
A. Home based services.

B. Centre-based services.
C. Residential ILTC services
D. All of the above
C2/2.11(a)
3. Catastrophic Outpatient Expenses in Medical Expense Insurance Policy covers _________.
A. Outpatient liver treatment charges

B. Outpatient kidney treatment charges
C. Major organ transplant
D. Outpatient assisted conception procedures
C2/2.15
4. Medical Expense Insurance Policy covers miscarriage. Which of the following is true?.
A. Only per policy year limits are stated.

B. Miscarriage due to ectopic pregnancy is covered.
C. Payment is on a per charged benefits basis.
D. Policy will not cease if it reaches the lifetime limit.

C2/3.6
5. If Mr Tan is enquiring about buying a policy for himself, his wife and 2 sons.
Premium is as follows:
Himself = $500
His wife = $700
1 son = $300
After considering he would like to cover only himself and his wife. How much family discount
did he enjoy?
A. $0
B. $60
C. $75
D. $90
C2/3.14
6. Mr. Tan who is self-employed is looking to buy a Medical Expense Insurance Policy. Which of
the following would be MOST suitable for him?.
A. Policy with no deductible

B. Policy with no co-insurance
C. Policy with no deductible and co-insurance
D. Policy with both deductible and co-insurance
C2/3.24
7. Mr. Tan and his family were injured while on holiday. They were covered under MEI, with a
deductible of $3000 and a co-insurance of 10%. Determine the total amount payable to Mr.
Tan, given hospital bills as follows:
Mr. Tan - $15,000
Mrs. Tan - $20,000
Son - $2,500
Daughter – $3,200
A. $26,280
B. $31,680
C. $33,630
D. $36,630
C2/3.47
8. Which of the following exclusions and limitations under Medical Expense Insurance is
FALSE?.
A. To avoid the insurer selecting against the insured.

B. To make premium more affordable.
C. To avoid policyowner receiving reimbursement twice and making a profit.
D. To define more clearly the necessary medical care and treatment.

C3/2.2(c)
9. Which of the following characteristics of group insurance is important to the underwriter in
determining the “feel” of future claim experience?.
A. Minimal Underwriting Requirements.

B. Experience-rating.
C. Cost effectiveness.
D. Plan continuation
C3/3.3, A2(b)
10. Which of the following must be disclosed to the participants for Group Voluntary A & H
Policies?.
A. Premium is fully paid by the employer.

B. They have a say in the type of coverage that they want.
C. Contractual rights of the insurer.
D. Duration of coverage is until age 62.
C3/4.13(a)
11. How does the “continuation benefits” under the TMIS benefits the employee?.
A. To continue enjoying hospitalization coverage from the termination for 12 months.

B. To enjoy automatic coverage under the New Employer Group Medical Expense Plan.
C. Waiver of exclusion on pre existing medical conditions when joining his new employer.
D. Enjoy a lower entitlement of either the new employer TMIS plan or prior employer TMIS
plan.
C4/5.8
12. Which of the following is most stringent in the definition of Total Disability under Disability
Income Insurance?
A. Own Occupation
B. Any Occupation
C. Modified Occupation
D. Similar Occupation
C4/5.18
13. Mr. Sim has requested for a Disability Income Policy with a short benefit period. Hence
insurer will:
A. Charge a lower premium.

B. Charge a higher premium.
C. Reduce the payouts.
D. Increase the payouts.

C4/6.7, Eg 4.2
14. Mr Tan, who is an accountant, used to earn $4,000 per month before he was disabled. After
partial recovery from his disability, he found a suitable job as a clerk, which pays him $1,500
per month. What would Mr Tan’s disability income benefit be?.
A. $3,000 per month

B. $2,500 per month
C. $1,875 per month
D. $4,000 per month
C4/8.8
15. An insured is covered under a Deferred Disability Income policy. 3 years later, he decides to
change to a more risky occupation and informs the insurance company. The underwriter is
likely to:
A. Exclude all disabilities as a result of the new application.

B. Reduce the monthly benefit payments without increasing the premiums.
C. Not change any of the policy terms as it is for more than 2 years old and is guaranteed
renewable.
D. Repudiate any claim.
C5/3.2
16. Which of the following least describes Long Term Care Insurance payment?.
A. Monthly Basis
B. Daily Basis
C. Disability Based Basis
D. Yearly Basis
C5/3.5 (a)
17. Which factor is the most important factor affecting premiums for LTCI Plans?.
A. Renewability
B. Number of exclusions
C. Number of Activities of Daily Living
D. Insured’s choice of distribution channels
C5/4.2(c)
18. In Long Term Care Insurance, Financial Assistance with Adaptation Benefit is:
A. An extra specified amount paid daily.

B. An extra monthly benefit.
C. A specified amount, 2 times the monthly benefit.
D. A specified sum more than the sum assured payable in special interval time.

C5/9.1(g)
19. Which of these exclusion(s) is/are True of Long term Care Insurance?.
A. All forms of AIDS.

B. Participation in a felony, riot or insurrection.
C. Flying other than a fare paying passenger.
D. Convalescent & special nursing care, general medical checkup.
C6/2.9 (r)
20. Which of the following features is MOST TRUE of Critical Illness Insurance?
A. Sublimit
B. Event Limit
C. Minimum and Maximum Limit
D. Lifetime Limit
C6/2.14
21. Which of the following type of CI Cover you may not need to attached a Critical Illness
Waiver of Premium Rider?
A. Acceleration Type
B. Additional Type
C. Both types
D. None of the types
C6/3.11(e)
22. Hospital Cash Income Insurance when issued on a stand-alone policy is more attractive
compared to a rider. Why is that so?.
A. There is a double payment if insured is hospitalized overseas due to accident.

B. It includes a Free death benefit.
C. It includes Rehabilitation income.
C6/5.13
23. Andrew is covered by his company's Group Dental Care Insurance Policy. Should Andrew
wishes to claim under this policy, which of the following is TRUE ?.
A. Insured can only use insurer's panel of dentists.

B. Insured have to make payment first and file a claim with insurer for reimbursement if
he uses his own dentists.
C. Insured has to make payment first whether or not he uses his own or insurer’s panel of
dentists.
D. The dental clinic will bill the insurer directly for bills incurred.

C7/3.2
24. Managed Healthcare Organizations work through which components to manage healthcare
expenditure?.
A. Quality of Care.
B. Premiums.
C. Enrolment fee for non usage.
D. Number of members eligible for enrolment.
C7/3.6,3.7
25. Which of the following is not a feature of the cost management under Managed Healthcare
Organisations?.
A. Large member enrolment

B. Consumer choices for healthcare services
C. Negotiated Provider Fees
D. Government subsidies on hospitals
C7/4.5
26. Which of the following type is the most restrictive under Managed Healthcare Plans?.
A. Point of Service Plans

B. Preferred Provider Organisations
C. Health Maintenance Organisations
D. Traditional Medical Expense Insurance
C7/5.1
27. Which of the following model, under Managed Healthcare Plans offers the lowest degree of
choice?.
A. Group Model HMO

B. Point Of Service Plan
C. Preferred Provider Organization
C8/ 3.10
28. What changes regarding Medisave Minimum Sum is most true with effect 1 Jan 2016?.
A. CPF member will need to set aside at least the Medisave Minimum Sum in his
Medisave account before he can withdraw his CPF Savings at or after the age of 55.
B. At the age of 55, if he did not have enough in his Medisave account at withdrawal, he
need to use excess balances from his Ordinary and Special account (OA & SA) to top
up his Medisave account to the Medisave Minimum Sum.
C. CPF members can withdraw his CPF savings beyond the Medisave Minimum Sum at
the age of 55.
D. CPF members can withdraw his CPF savings from his OA and SA upon reaching the
age of 55 years, without the need to top up his Medisave account to the Medisave
Minimum Sum . This provides more certainty to the CPF Members after the age of 55
years.

C8/3.13e(v)
29. Medisave cannot be used to pay for which expenses under Chronic Disease
Management Programme?.
A. Laboratory Tests
B. Prostheses
C. Consultations
D. Allied health services
C8/4.7
30. Which of the following is NOT one of the reasons why MediShield Life premiums (before
subsidies) are higher than MediShield premiums?.
A. MediShield Life has better benefits than MediShield.

B. Only MediShield Life pays for visits to the polyclinics and GP Clinics.
C. MediShield Life premiums include a small portion of the additional costs of universal
coverage.
D. Premiums are distributed more evenly over our lifetime in MediShield Life.
C8/4.25
31. MediShield Life Claim payouts are computed subject to deductible. "Deductible" in MediShield
Life ______________________.
A. is a fixed amount payable by the insured only once every policy year.
B. is a fixed amount payable by the insured each time he makes a claim.
C. is a fixed amount payable by the insurer upon insured's hospitalisation.
D. is a fixed amount payable by the insurer in the form of cash payouts upon
hospitalisation.
C8/4.28, Eg 8.1
32. Miss Tan, a Singaporean was hospitalised in a government hospital for 10 days in a Class C
Ward. Calculate how much will MediShield Life pays, given the following details:
Total hospital bills = $5,850

Deductible = $1,500
Co-insurance applies on the following rates:
From $0- $5000 - 10%
From $5,001 to $10,000 - 5%
More than $10,000 - 3%
A. $3,958
B. $3,915
C. $4,350
D. $4,133

C8/4.33(b)
33. The MediShield Life Scheme Act provides for the implementation and administration of the
MediShield Life Scheme. Which is NOT a key features of the Act?.
A. Providing for access to information to facilitate the extension of MediShield Life

premium subsidies to all eligible households.
B. To recover premiums from willful defaulters to ensure premiums are paid in a timely
manner.
C. Section 73 of the Conveyancing and Law of Property Act (Cap 61) apply to the
policy issued under the Scheme.
D. Lifelong universal coverage for all Singapore Citizens and SPRs.
C8/ 5.5
34. John has pre-existing conditions and is thinking of buying an Integrated Shield Plans (IPs).
Which is true with regard to his pre-existing conditions?.
A. He may be excluded by both his IP Policy and MediShield Life.

B. He will be covered by his IP Policy if he is covered by MediShield Life.
C. Should he be excluded by his IP Policy, MediShield life will pro-rate the benefits
payable.
D. Should he be excluded by his IP Policy, MediShield life will cover him for life.
C8/7.13
35. Mr. Tan is 65 years old in the year 2014, and is unable to pay his hospital bill. He can seek
assistance from:
A. Interim Disability Programme for the Elderly (IDAPE)

B. ElderShield
C. Medifund
C9/3.2
36. The Policy Schedule in a Health Insurance Policy gives the specific details of the policy
contract. Which of these details are found in the Policy Schedule?.
A. Name, NRIC of Insured

B. Name, NRIC of Beneficiary
C. Claim procedures
D. Insurer’s contractual rights
C9/5.22
37. An Optionally Renewable Health Insurance Policy gives the insurer the right to terminate the
policy :
A. At anytime, for any reason

B. When the insured reaches a certain age
C. When the insured changes his employment status
D. At the policy anniversary date or any premium due date

C9/8.5
38. Physical examination provision is included in Disability Income Polices to enable insurer to;
A. have the insured examined by the insurer’s doctor at the insured’s expense.
B. have the insured examined by the insured’s doctor at the insurer’s expense.
C. have the insured examined by the insurer’s doctor at the insurer’s expense.
D. have the insured examined by the insured’s choice of doctors on a contributory basis.
C10/2.2
39. Which of the following key factors is NOT used in computing premium for Health Insurance
Products?
A. Investment Income
B. Mode of Premium
C. Operating expenses
D. Occupation
C10/3.13
40. Which of the following will decrease premium?
A. Decrease in investment income.

B. Increase in persistency.
C. Increase in morbidity.
D. Increase in benefits covered.
C11/3.20
41. The detection of any early cognitive impairment is essential when underwriting:
A. Dread Disease Insurance.

B. Disability Income Insurance.
D. Managed Healthcare Insurance.
C11/3.44
42. Employees classes has effects of over-representation. Over-representation by a class in
which the employees earn low incomes can result in _______________.
A. Higher-than-desired rate of turnover.

B. Lower-than-average medical claims.
C. Higher-than-average medical claims.
D. Lower-than-desired rate of turnover.

C11/4.15
43. To get a better insight to insured’s medical history, not available from medical examinations,
underwriter request for:
A. Agent’s Statement.
B. Supplementary Questionnaires.
C. Medical Examination/Test.
D. Attending Physician Statement.
C11/5.3
44. An adviser can expedite the underwriting process by:
A. Sending the insured for medical examination.

B. Extracting as much detail as possible from the insured if he is seeing a doctor for his
diabetes.
C. Calling for an Attending Physician’s Statement on behalf of the underwriters.
D. Getting the profit / loss statement if the insured is a self employed.
C12/33
45. Notice No: MAS 120 - Division 4 on Requirements on Provision of Advice Relating to Accident
and Health Insurance Policies shall not apply to:
A. ElderShield Policy
B. Long Term Care Insurance
C. Hospital Cash (Income) Insurance
D. Disability Insurance
C12/52(h)
46. Which of these offences under MAS Notice 120 is not considered a criminal offence and
does not attract any penalties?.
A. Failure to disclose the conditions under which payment of policy moneys will not be
made to insured.
B. Failure by the A&H representative to use only marketing materials that has been
approved by the insurance intermediary.
C. Documents given to the insured are kept up to date.
D. Opinions expressed and facts are not differentiated.
C13/3.3(b)
47. "Application Type 2" under the Fact-Find Document means _______________________.
A. the client do not wish to receive any advice from adviser.

B. the client already knows the product and coverage they want to purchase.
C. the client wishes to receive product advise only.
D. the client wishes to disclose all information requested in this form.

C13/4.13 Eg 13.3
48. Mr. Lim has recently bought Dread Disease Insurance. He is concerned about Mrs. Lim, who
is a housewife, his son who is a newborn and their future daily expenses should anything
happen to him. Given that his family’s monthly expenses amount to $3,000, with existing
inflation rate of 2% and investment return of 7%, how much would Mrs. Lim require in the
event that Mr. Lim is not around, assuming number of years income needed is 21.
A. $630,775
B. $47,632
C. $484,639
D. $554,940
C13/4.20(a)
49. Calculation of how much Critical Illness Insurance the client needs is more of an art than a
science as there are many uncertainties. Which of these factors would be most important?
A. Whether the client has the means to pay the premium.

B. Need to know the client’s family medical history to determine which disease the client is
most susceptible.
C. Obtain the latest attending physician statement as an indication of his current physical
condition.
D. Occupational risk classification of the client.
C14/3.6
50. Which of the following method is fairer in determining the sum assured for group health
insurance?
A. Employee’s Salary X Performance Factor

B. Employee’s Salary X Standard Factor
C. According to Rank
D. Lower position; higher sum assured.

Mock Exam 3 Answers

1. B 26. C
2. D 27. A
3. B 28. D
4. B 29. B
5. B 30. B
6. C 31. A
7. A 32. A
8. A 33. C
9. B 34. D
10. B 35. C
11. A 36. A
12. B 37. D
13. A 38. C
14. C 39. D
15. B 40 B
16. D 41. C
17. C 42. A
18. C 43. D
19. B 44. B
20. C 45. A
21. A 46. C
22. C 47. C
23. B 48. C
24. A 49. B
25. D 50. B
Workings
Qn 5
Ans:
($500 + $700) X 5% = $60
Qn 7
Ans:
Mr. Tan : $15,000 - $3000 = $12,000 - $1,200 (coinsurance 10%) = $10,800
Mrs. Tan : $20,000 - $3000 = $17,000 - $1,700 (coinsurance 10%) = $15,300
Son : cannot claim as expense is below deductible
Daughter : $3,200 - $3000 = $200 - $20 (coinsurance 10%) = $180
Hence total payable = $10,800 + $15,300 + $180 = $26,280
Qn 14
Ans:
$4000 - $1500 / $4000 x $3000 = $1875

Qn 32
Ans:
Total bills = $5,850
less deductible =$1,500
*less co-insurance = $392.5
MediShield Life pays =$3,957.5
Calculate co-insurance
$1,501 to $5,000 - 10% x $3,500 = $350
$5,001 to $10,000 - 5% x $850 = $42.5
Co - insurance payable = $350 + $42.5 = $392.5
Qn 48
Ans:
$3000 x 12 =$36,000 x 13.4622(table A2– 5%, 21 years)
= $484,639

Mock Exam 4
C1/2.9(c)
1. To ensure healthcare remains affordable, how does the government enhanced support for
Singaporeans?.
A. Expand Medisave to cover all types of outpatient treatments.

B. Enhancing collective responsibility of healthcare through MediShield Life.
C. Reduce Government healthcare expenditure through MediShield Life.
D. Increase Government share of national healthcare expenditure by providing more
choices of hospitals and polyclinics.
C1/4.1
2. Singapore healthcare financing framework comprises of which of the following?.
A. MediShield Life, Medifund & ElderShield

B. Medisave, Medifund and Interim Assistance Programme for the Elderly (IDAPE).
C. Government subsidies, Medisave and individual savings.
D. Government subsidies, individual savings and insurance.
C2/2.11(b)
3. Which of the following is covered under Catastrophic Outpatient Treatment in a Medical
Expense Insurance Policy?.

B. Outpatient heart treatment charges
C. Outpatient cancer treatment charges
D. Outpatient tuberculosis treatment charges
C2/2.15
4. Miscarriage Benefit in a Medical Expense Policy provides for:
A. The reimbursement of expenses in a willful termination to a pregnancy.

B. The reimbursement of Assisted Conception Procedure treatments.
C. The reimbursement of charges incurred for the consultation of a specialist
within a number of days before termination.
D. The reimbursement of medical expenses in an ectopic pregnancy.
C2/3.19
5. Which deductible under Medical Expense Insurance is the most common one used by
insurers in Singapore?
A. Per Annum
B. Per Disability/ Per Year
C. Per Disability/Per Claim
D. Per Disability

C2/3.22
6. Mr. Tan has a basic Medical Expense Insurance policy, which has a $500 deductible from 1
January to 31 December 2013. At the beginning of the year, he was hospitalised and the
charges amounted to $200. Recently, he was warded and the charges amounted to $600.
What are the total benefits payable by the insurer, assuming per disability/per claim
deductible is used?
A. $300
B. $100
C. $500
D. $800
C2/3.23
7. Which of the following is NOT true of Medical Expense Insurance?
A. Pro ration factor and co-insurance.

B. Deductibles apply for all treatments.
C. Impose Sub- Limits.
D. Can be issued as a rider or stand-alone.
C2/2.9(p)
8. Under Inpatient Expenses of Medical Expense Insurance, when the Insured Person is a
recipient, Major Organ Transplant Benefit covers:
A. Cost of immunosuppressant drugs

B. Cost of Surgeries
C. Acquisition of Organ
D. Recipient Costs
C3/2.3
9. Group Polices often have an “actively at work” clause. In order to be eligible for the cover,
this clause requires:
A. The employee to be under a compulsory scheme.

B. The employee to be full time employed on the day the insurance coverage takes effect.
C. The employee to be at work on the day the insurance coverage takes effect.
D. The employee to obtain official Medical Certificate if he is unwell on the day the
insurance coverage takes effect.
C3/3.3, A2(b)
10. Which type of Group Medical Expense Insurance Plans gives the employees some control
over the plan?
A. Voluntary Plan
B. Compulsory Plan
C. Compulsory Plan and Voluntary Plan
D. None

C3/3.4 Table
11. What is the key difference between an Individual and Group Insurance?
A. Premium bought under Group Insurance is unit related.

B. Many contracts are issued in Group Insurance.
C. All members of Group Insurance have to go for medical check-up.
D. Individual members’ health is evaluated for Group Insurance.
C3/4.29
12. Which of the following regarding ad-hoc contributions to employees' Medisave Account is
false?.
A. An employer cannot make ad-hoc contributions to the employees' Medisave Account

unless it is adopting the Portable Medical Benefit Options.
B. An employer can make ad-hoc contributions to the employees' Medisave Account.
C. An employer can make ad-hoc contributions to the employees' Medisave Account and
the employer can get an additional tax deduction beyond the 1% limit for the amount of
ad-hoc Medisave contribution made.
D. The overall tax deduction for medical expenses will be subject to the overall cap of 2%.
C4/6.6 & 6.9

13. What is true of the difference between “Rehabilitation Benefit” and Rehabilitation Expense
Benefit?.
A. Rehabilitation Benefit is for payment if insured is unable to go to work.

B. Rehabilitation Benefit is for reimbursement of medical aids eg. Wheelchair.
C. Rehabilitation Expense Benefit is for payment of reduce benefit.
D. Rehabilitation Expense Benefit is reimbursements that includes workplace
modifications.
C4/6.12
14. The following data is to be used for this question and Qn. 14,15 and 16
Mary, a lecturer bought a DI Policy, became disabled on 30/6/08. Her details as follows:
Salary : $8000 per month ;

Her expenses: $3000 per month;
Annual Escalation Benefit : 3% ;
6 Month Deferred Period chosen
When will she received the first payment from the insurer and for how much?.
A. 1/1/2009 for $8000

B. 1/1/2009 for $6000
C. 31/12/2008 for $6180
D. 31/12/2008 for $2250

15. When will the escalation benefit kicked in and how much will she get?.
A. 30/6/2009 for $8240

B. 31/12/2008 for $5150
C. 1/2/2009 for $6080
D. 1/1/2010 for $6180
16. Mary subsequently on 1/2/2010 found a job as a tutor which pays her $2000 a month.
Calculate partial disability benefit payable on 1/2/2010.
A. $3,090
B. $4,500
C. $4,635
D. $4,180
C5/3.5 (c)
17. The ability to move indoors from room to room on level surfaces describes which Activities of
Daily Living?
A. Transferring
B. Mortality
C. Mobility
D. Morbidity
C5/3.7
18. In Long Term Care insurance, the deferred period is defined as a period of time:
A. after the insured is certified by a medical practitioner that he is unable to perform

specified numbers of ADLs.
B. from the inception of the policy or any reinstatement of the policy
C. from the commencement date of the policy.
D. from the time the insured is hospitalized.
C5/8, C8/6.22(i)
19. In which area is Long Term Care Insurance different from ElderShield?.
A. Free look Period.

B. The definition of Activity of Daily Livings (ADLs).
C. Purpose of the plans.
D. On how the plan is issued, eg guaranteed renewable basis.

C5/8 (a)
20. Long Term Care Insurance is similar to Group Dental Care in that they_____________.
A. do not cover pre-existing dental and other pre-existing conditions.

B. can be issued on standalone or rider basis.
C. do not pay in addition to other insurance.
D. covers only those who are actively at work.
C6/5.8(d)
21. Like all other insurance covers, Group Dental Care Insurance Policies also impose certain
exclusions. Which is most true of such exclusions?.
A. Pre-existing dental conditions.

B. Medicine given.
C. Wisdom tooth extraction.
D. Scaling, polishing and root canal treatment.
C6/2.13
22. Mr. Tan has a Critical Illness Policy with a 50% acceleration benefit. The policy also has a
Critical illness waiver of premium rider attached to it. After a dread disease claim by Mr. Tan,
which of the following statement(s) regarding the premium is most true?.
A. remain unchanged
B. premium is waived for the full sum assured
C. premium reduced in proportion to how the basic sum assured is reduced.
D. premium will be reduced by 50%.
C6/2.20
23. Amy bought a Critical Illness Insurance with a sum assured of $200,000. She also bought an
additional benefit CI rider of $150,000. Which of the following statements is TRUE?.
A. Upon accidental death, insurer will pay $350,000.

B. In the event of an accident that caused her to be total permanently disabled, insurer
will pay $350,000.
C. She was diagnosed with skin cancer and subsequently died 4 months later. Insurer will
pay a total sum of $350,000.
D. In the event she was diagnosed with one of Critical Illness, insurer with pay a sum
assured of $350,000.
C6/2.15
24. Adviser is proposing a 50% Acceleration Dread Disease Policy to his client John , to cover
John's wife who is a homemaker. In this case, adviser should also propose to attach which
of the following riders?.
A. Waiver of Premium Rider to the policy.

B. Disability Income Insurance Rider to the policy.
C. Critical Illness Waiver of Premium Rider to the policy.
D. Total and Permanent Disability Benefit Rider to the policy.

C7/4.19
25. Which of the following offers the broadest consumer choice of physicians and clinical
settings?.
A. Staff Model
B. Group Model
C. Network Model
D. Mixed Model HMO
C7/5.1
26. Which of the following Managed Healthcare plans is the most expensive?.
A. Staff Model HMO

B. Group Model HMO
C. Network Model HMO
C7/6.2
27. Which of the following is not a benefit of Managed HealthCare Plans?.
A. Preventive Care
B. Specialist Care
C. Intensive Care
D. Emergency Care
C7/6.5
28. Which of the following is NOT true of Managed Healthcare Insurance?.
A. It excludes pre-existing conditions.

B. Payments are reduced by reimbursements from Work Injury Compensation and other
forms of insurance.
C. Deductibles and Co-insurance do not apply in Managed Healthcare Insurance.
D. Members have a choice of in-network or out-network providers.
C8/4.18
29. To ease the shift to MediShield Life, those whose net premium still increase in comparison to
MediShield, despite subsidies, will receive further subsidies for the first 4 years of MediShield
Life. This subsidy is ___________________.
A. Transitional Subsidies
B. Pioneer Generation Subsidies
C. Premium Subsidies
D. Additional Premium Support Subsidies

C8/4.25
30. Which of the following is FALSE regarding how MediShield Life works?.
A. Allows members to insure their spouse, children, parents and grandparents.

B. MediShield Life is sized for class B2/C wards and subsidized treatments in public
hospitals.
C. Deductible is applicable once every policy year.
D. Deductibles apply for covered outpatient treatments.
C8/4.26
31. Co-insurance is a feature of MediShield Life. It is describe as____________.
A. a percentage of the claimable amount, which insured have to pay before deductible.
B. a percentage of the claimable amount, which insured have to pay on top of deductible.
C. a fixed amount payable by the insured.
D. a fixed amount that will decrease the amount payable from the insurer.
C8/4.28, Eg 8.1
32. Melvin, a Singapore Citizen was hospitalised for an operation and he stayed in a Class A
ward for 18 days, his total hospital bill amounted to $16,500. Calculate for this bill, how
much will MediShield Life claim computation will be based on ?.
Given:
Pro-ration - 35%
Deductible = $2,000
From $0 - $5000 - 10%
From $5,001 to $10,000 - 5%
More than $10,000 - 3%
A. $5,775
B. $5,075
C. $4,776
D. $4,765
C8/4.34(2)
33. Section 10 of the The MediShield Life Scheme Act 2015 states that :
A. Rights of the insured person arising from the insurance cover under the Scheme are
transferable.
B. The Insurance Act will apply to the Scheme.
C. A policy of insurance issued under the Scheme does not create any legal or equitable
trust.
D. Section 73 of the Conveyancing & Law Property Act (Cap 61) will have an effect on the

C8/5.13, 5.14
34. Which is false with regard to the Standard IP?.
A. The benefits and the premiums of the Standard IP are identical across all IP insurers.
B. It is meant to target Class B1 ward hospital bills.
C. Premiums and underwriting decisions for the plan are determined by the insurers.
D. It is a viable option to allow those who want to switch from their Class A and Private
Hospital IPs to a more affordable plan.
C8/5.22
35. Any policy holder who switches from his IP from one insurer to another , _______________.
A. does not have the option to go back to the previous insurer.

B. will have the option to go back to the previous insurer within 30 days from the date of
notification of termination from the previous insurer.
C. will have the option to go back to the previous insurer, subject to underwriting by the
previous insurer.
D. does not have the option to go back to the previous insurer unless he does not make a
claim within 30 days with the new insurer.
C8/7.9(b), 6.2
36. Wally bought an ElderShield 400 Plan at the age of 60. His premiums was $789. Five years
later, in the year 2014, he was unable to perform at least 3 ADLs under the plan, how much
benefits will he received in total on the first month?.
A. $S400
B. S$500
C. S$4800
D. S$6000
C9/3.1
37. The Policy Schedule in a Health Insurance Policy contains ____________.
A. The details of the policy owner, insured as well as insurance coverage.

B. The conditions under which the benefits will be paid.
C. That the present contract, together with any stipulated attachments, makes up
the entire contract.
D. That the policy will terminate if an insured resides outside Singapore for more
than a specified period of time.
C9/4.2
38. Which of the following sections in a Health Insurance Policy contract represents the
“foundation” of a Health Insurance Policy?.
A. Policy Schedule
B. General Conditions
C. Insuring Clause
D. Benefits Provisions

C9/9.1
39. An endorsement attaching to an insurance policy :
A. has no legal effect

B. modifies the policy provision
C. is independent of the policy
D. provides additional benefits at no extra cost
C10/2.6
40. An increase in which of the following factor will NOT increase premium computation?
A. Investment income
B. Scope of benefits
C. Insurer’s expenses
D. Medical inflation
C11/4.9
41. Agent’s statement is needed to:
A. Let underwriter knows why that product is recommended.

B. Indicate applicant’s approximate net worth.
C. Clarify situations that is unquestionable.
D. Indicate information that is important to the applicant.
C11/4.15
42. An underwriter needs to know more about a client’s medical history which the medical
examination was not able to reveal. What form does he need?
A. Agent’s Statement
B. Attending Physician’s Statement
C. Supplementary Questionnaires
D. Fact Find Form
C11/6.4(i)
43. Which of the following plan will exclusions most likely be used for sub standard risks?.
A. Disability Income Insurance.

B. Critical Illness.
D. Personal Accident.

C11/6.4 (ii)
44. Which of the following helps to reduce insurer’s risk?
A. Shorter deferred period.

B. Longer benefit period.
C. Extra premium.
D. Increase benefits.
C12/54
45. To facilitate the monitoring of switching for Long-Term accident and health policies, that may
be detrimental to an policy owner's interest by an A&H rep, the A&H insurance intermediary
should ensure ____________________.
A. the A&H rep has declared in writing that the policy owner agreed to the switch.
B. the policy owner has declared in writing whether he has been advised by the A&H rep to
switch.
C. Both are correct
D. Both are incorrect
C12/57
effectively monitor and track switching of long-term accident and health plans. Which is true
of such process?
A. Track the volume of switches so as to identify any A&H insurance reps with an unusually
high volume of switching transactions.
B. Ensure supervisor reviewed the each switch.
C. Identify any unusual trends in switching transactions.
C13/4.2
47. Mr. Lim the prospective client does not have an emergency fund, you should:
A. still recommend suitable products.

B. ensure he ticks Type 1 of the application type.
C. not recommend any policies as it may affect his ability to service the policies.
D. recommend disability income insurance.
C13/4.20
48. During need analysis, when recommending a Critical Illness Insurance, what must an advisor
advise a client?
A. Claims procedures.
B. Underwriting considerations.
C. Mode of Payment.
D. Coverage.

C13/4.13, Eg 13.3
49. Miss X’s monthly income and expenses are $4,000 and $3,000 respectively. She is 32 yrs
old, single and would like to provide for herself till retirement (55 yrs old) in the event of
disability. She has an existing $100,000 Whole Life Insurance. Given an inflation rate of 2%
and interest rate of 4%, calculate the maintenance cost needed.
A. $795,586
B. $571,688
C. $671,688
D. $445,530
C14/2.12
50. Calculate for Tommy, the level of Medical Expense needed, given the following:
Basic average medical expenses needed for 1 hospitalisation in a year = $24,000

Benefits paying under his Group policy = $18,240
Amount payable under his IncomeShield Plan = $7,335
A. $5,760
B. $16,665
C. $1,575
D. No Shortage of medical expense protection

Mock Exam 4 Answers

1. B 26. D
2. D 27. C
3. C 28. C
4. D 29. A
5. A 30. D
6. B 31. B
7. B 32. A
8. B 33. C
9. C 34. A
10. A 35. B
11. A 36. B
12. A 37. A
13. D 38. C
14. B 39. B
15. D 40 A
16. C 41. B
17. C 42. B
18. A 43. C
19. A 44. C
20. B 45. B
21. B 46. D
22. C 47. C
23. C 48. D
24. C 49. B
25. D 50. D
Workings
Qn 6
Ans:
$600 - $500 = $100 (per disability/per claim)
Qn14
Ans:
Deferred period 6 months from 30/6/08, hence payable on 1/1/09.
Payments = $8000 x 75% = $6000
Qn 15
Ans:
Escalation will be effective on the 2nd year ie 1.1.2010 at $6180. ($6000 + $6000 x3%)
Qn 16
Ans:
($8000 - $2000)/$8000 x $6180 = $4635
Qn 32
Ans:
Total bill = $16,500
35% of $16,500 = $5,775

Qn 36
Ans : $500 ($400 from ElderShield, $100 from Pioneer Generation Disability Assistance Scheme).
Qn 49
Ans:
$3000 x 12 = $36,000 x 18.6580 (table A2– 2%; 23 yrs)
$671,688 - $100,000 = $571,688
Qn 50
Ans:
$24,000 – ($18,240 +$7335) = ($1,575); no shortage

Health Insurance Set A
HEALTH INSURANCE
(6th Edition)
Set A

Strictly For Internal Use. Materials Prepared By Julia Sim (December 2019)
Set A
C1/2.3
healthcare services for Singaporeans. The focus is on 3 strategic objectives, namely
_______________.
A. enhancing accessibility, quality and wide network for healthcare.

B. promoting health, prevent and reduce illness.
C. providing good, affordable and quality healthcare.
D. enhancing accessibility, quality and affordability of healthcare.
C1/3.11
treatment after discharge from the hospital, who may need assistance with their activities of
daily living. This can be through:

D. All of the above
C1/3.4A, Sup notes V1.3, Pt 2 (Pg 1)

3. Under the Community Health Assist Scheme (CHAS), all Singaporeans suffering from chronic
illnesses can tap the CHAS for subsidies. This is true for:
A. the new CHAS Green tier holders

B. the existing Orange tier holders
C. the existing Blue tier holders
D. All of the above
C2/2.15
4. Medical Expense Insurance Policy covers miscarriage. Which of the following is/are true?
A. Willful terminations are covered.

B. Miscarriage due to ectopic pregnancy is covered.
C. None of the above.

C2/3.6
5. If Mr Tan is enquiring about buying a policy for himself, his wife and 2 sons.
Premium is as follows:
Himself = $500
His wife = $700
1 son = $300
After considering he would like to cover only himself and his wife. How much family discount
did he enjoy?
A. $0
B. $60
C. $75
D. $90
C2/3.14
6. Mr. Tan who is self-employed is looking to buy a Medical Expense Insurance Policy. Which of
the following would be MOST suitable for him?
A. Policy with no deductible

B. Policy with no co-insurance
C. Policy with no deductible and co-insurance
D. Policy with both deductible and co-insurance
C2/3.24
7. Mr. Tan and his family were injured while on holiday. They were covered under MEI, with a
deductible of $3,000 and a co-insurance of 10%. Determine the total amount payable to Mr.
Tan, given the details of the hospital bill as follows:
Mr. Tan - $15,000
Mrs. Tan - $20,000
Son - $2,500
Daughter – $3,200
A. $26,280
B. $31,680
C. $33,630
D. $36,630
C2/3.47
8. Which of the following exclusions and limitations under Medical Expense Insurance is
FALSE?
A. To avoid the insurer selecting against the insured.

B. To make premium more affordable.
C. To avoid policyowner receiving reimbursement twice and making a profit.
D. To define more clearly the necessary medical care and treatment.

C3/2.2(c)
determining the “feel” of future claim experience?

C3/3.3, A2(b)
10. Which of the following must be disclosed to the participants for Group Voluntary A & H
Policies?
A. Premium is fully paid by the employer.

B. They have a say in the type of coverage that they want.
C. Contractual rights of the insurer.
D. Duration of coverage is until age 62.
C3/4.13(a)
11. How does the “continuation benefits” under the Transferable Medical Insurance Scheme
(TMIS) benefits the employee?
A. To continue enjoying hospitalization coverage from the termination for 12 months.

C. Waiver of exclusion on pre-existing medical conditions when joining his new employer.
plan.
C4/5.8
12. Which of the following is most stringent definition of “Total Disability” under Disability Income
Insurance?
A. Own Occupation
B. Any Occupation
C4/5.18
13. Mr. Sim has requested for a Disability Income Policy with a short benefit period. Hence
insurer will:
A. Charge a lower premium.

B. Charge a higher premium.
C. Reduce the payouts.
D. Increase the payouts.

C4/6.7, Eg 4.2
per month. What would Mr Tan’s disability income benefit be?
A. $3,000 per month

B. $2,500 per month
C. $1,875 per month
D. $4,000 per month
C4/8.8
likely to:

renewable.
C5/3.2
16. Which of the following least describes Long Term Care Insurance payment?
A. Monthly Basis
B. Daily Basis
C. Disability Based Basis
D. Yearly Basis
C5/3.5 (a)
17. Which factor is the most important factor affecting premiums for Long Term Care Insurance
Plans?
A. Renewability
B. Number of exclusions
C. Number of Activities of Daily Living
D. Insured’s choice of distribution channels
C5/4.2(c)
18. In Long Term Care Insurance, Financial Assistance with Adaptation Benefit is:
A. An extra specified amount paid daily.

B. An extra monthly benefit.
C. A specified amount, 2 times the monthly benefit.
D. A specified sum more than the sum assured payable in special interval time.

C5/9.1(g)
19. Which of these exclusion(s) is/are True of Long term Care Insurance?
A. All forms of AIDS.

B. Participation in a felony, riot or insurrection.
C. Flying other than a fare paying passenger.
C6/2.9 (r)
20. Which of the following features is MOST TRUE of Critical Illness Insurance?
A. Sublimit
B. Event Limit
C. Minimum and Maximum Limit
D. Lifetime Limit
C6/2.14
21. Which of the following type of CI Cover you may not need to attached a Critical Illness
Waiver of Premium Rider?
A. Acceleration Type
B. Additional Type
C. Both types
D. None of the types
C6/3.11(e)
22. Hospital Cash Income Insurance when issued on a stand-alone policy is more attractive
compared to a rider. Why is that so?
A. There is a double payment if insured is hospitalized overseas due to accident.

B. It includes a Free death benefit.
C. It includes Rehabilitation income.
C6/5.13
23. Andrew is covered by his company's Group Dental Care Insurance Policy. Should Andrew
wishes to claim under this policy, which of the following is TRUE?
A. Insured can only use insurer's panel of dentists.

B. Insured have to make payment first and file a claim with insurer for reimbursement if
he uses his own dentists.
C. Insured has to make payment first whether or not he uses his own or insurer’s panel of
dentists.
D. The dental clinic will bill the insurer directly for bills incurred.

C7/3.2
24. Managed Healthcare Organizations work through which components to manage healthcare
expenditure?
A. Quality of Care.
B. Premiums.
C. Enrolment fee for non-usage.
D. Number of members eligible for enrolment.
C7/3.6,3.7
25. Which of the following is not a feature of the cost management under Managed Healthcare
Organisations?
A. Large member enrolment

B. Consumer choices for healthcare services
C. Negotiated Provider Fees
D. Government subsidies on hospitals
C7/4.5
26. Which of the following type is the most restrictive under Managed Healthcare Plans?
A. Point of Service Plans

B. Preferred Provider Organisations
C. Health Maintenance Organisations
C7/5.1
27. Which of the following model, under Managed Healthcare Plans offers the lowest degree of
choice?
A. Group Model HMO

B. Point Of Service Plan
C. Preferred Provider Organization
C8/ 3.10
28. What changes regarding Medisave Minimum Sum is most true with effect 1 Jan 2016?
A. CPF member will need to set aside at least the Medisave Minimum Sum in his
Medisave account before he can withdraw his CPF Savings at or after the age of 55.
B. At the age of 55, if he did not have enough in his Medisave account at withdrawal, he
need to use excess balances from his Ordinary and Special account (OA & SA) to top
up his Medisave account to the Medisave Minimum Sum.
C. CPF members can withdraw his CPF savings beyond the Medisave Minimum Sum at
the age of 55.
D. CPF members can withdraw his CPF savings from his OA and SA upon reaching the
age of 55 years, without the need to top up his Medisave account to the Medisave
Minimum Sum . This provides more certainty to the CPF Members after the age of 55
years.

C8/3.13e(v)
Management Programme?
A. Laboratory Tests
B. Prostheses
C. Consultations
C8/4.7
30. Which of the following is NOT one of the reasons why MediShield Life premiums (before
subsidies) are higher than MediShield premiums?
A. MediShield Life has better benefits than MediShield.

B. MediShield Life pays for visits to the polyclinics and GP Clinics.
C. MediShield Life premiums include coverage of pre-existing conditions.
D. Premiums are distributed more evenly over our lifetime in MediShield Life.
C8/4.25
31. MediShield Life Claim payouts are computed subject to deductible. "Deductible" in MediShield
Life ______________________.
A. is a fixed amount payable by the insured only once every policy year.
B. is a fixed amount payable by the insured each time he makes a claim.
C. is a fixed amount payable by the insurer upon insured's hospitalisation.
D. is a fixed amount payable by the insurer in the form of cash payouts upon
hospitalisation.
C8/4.28, Eg 8.1

Deductible = $1,500
From $0- $5000 - 10%
From $5,001 to $10,000 - 5%
More than $10,000 - 3%
A. $3,958
B. $3,915
C. $4,350
D. $4,133

C8/4.34(3)
33. The MediShield Life Scheme Act provides for the implementation and administration of the
MediShield Life Scheme. Which is NOT a key features of the Act?
A. Providing for access to information to facilitate the extension of MediShield Life

premium subsidies to all eligible households.
B. To recover premiums from willful defaulters to ensure premiums are paid in a timely
manner.
C. Section 73 of the Conveyancing and Law of Property Act (Cap 61) apply to the
D. Lifelong universal coverage for all Singapore Citizens and SPRs.
C8/ 5.5
34. John has pre-existing conditions and is thinking of buying an Integrated Shield Plans (IPs).
Which is true with regard to his pre-existing conditions?
A. He may be excluded by both his IP Policy and MediShield Life.

B. He will be covered by his IP Policy if he is covered by MediShield Life.
C. Should he be excluded by his IP Policy, MediShield life will pro-rate the benefits
payable.
D. Should he be excluded by his IP Policy, MediShield life will cover him for life.
C8/7.13
35. Mr. Tan is 65 years old in the year 2014, and is unable to pay his hospital bill. He can seek
assistance from:
A. Interim Disability Programme for the Elderly (IDAPE)

B. ElderShield
C. Medifund
C9/3.2
contract. Which of these details is found in the Policy Schedule?
A. Name of Insured
B. Name of Insurer
C. Name of beneficiary
D. All of the above
C9/5.2
37. All insurance contracts have an "Entire Contract Clause”. In a Health Insurance Contract,
which of the following make up the entire contract between the insured and the insurer?
A. Policy Document and Proposal Form.

B. Policy Document and Fact Find Form.
C. Policy Document and Insuring clause.
D. Policy Document and Schedule of Benefits.

C9/5.15

C10/2.2
39. Which of the following key factors is NOT used in computing premium for Health Insurance
Products?
A. Investment Income
B. Mode of Premium
C. Operating expenses
D. Occupation
C10/3.13
40. Which of the following will likely decrease premium?
A. Decrease in investment income.

B. Increase in persistency.
C. Increase in morbidity.
D. Increase in benefits covered.
C11/3.20
41. The detection of any early cognitive impairment is essential when underwriting which product?

C11/3.44
42. Employees classes have effects of over-representation. Over-representation by a class in
which the employees earn low incomes can result in _______________.
A. Higher-than-desired rate of turnover.

B. Lower-than-average medical claims.
C. Higher-than-average medical claims.
D. Lower-than-desired rate of turnover.

C11/4.15
43. To get a better insight to insured’s medical history, not available from medical examinations,
underwriter will request for:
A. Agent’s Statement.
B. Supplementary Questionnaires.
C. Medical Examination/Test.
D. Attending Physician Statement.
C11/5.3
44. An adviser can expedite the underwriting process by:
A. Sending the insured for medical examination.

B. Extracting as much detail as possible from the insured if he is seeing a doctor for his
diabetes.
C. Calling for an Attending Physician’s Statement on behalf of the underwriters.
D. Getting the profit / loss statement if the insured is a self employed.
C12/33
45. Notice No: MAS 120 - Division 4 on Requirements on Provision of Advice Relating to Accident
and Health Insurance Policies shall not apply to:
A. ElderShield Policy
B. Long Term Care Insurance
C. Hospital Cash (Income) Insurance
D. Disability Insurance
C12/52(h)
46. Which of these offences under MAS Notice 120 is considered as Non-Mandatory Best
Practice Standards?
A. Failure to disclose the conditions under which payment of policy moneys will not be
made to insured.
B. Failure by the A&H representative to use only marketing materials that has been
approved by the insurance intermediary.
C. Documents given to the insured are kept up to date.
D. Opinions expressed and facts are not differentiated.
C13/3.3(b)


C13/4.13 Eg 13.3
A. $630,775
B. $47,632
C. $484,639
D. $554,940
C13/4.20(a)
49. Calculation of how much Critical Illness Insurance the client needs is more of an art than a
science as there are many uncertainties. Which of these factors would be most important?
A. Whether the client has the means to pay the premium.

B. Need to know the client’s family medical history to determine which disease the client is
most susceptible.
C. Obtain the latest attending physician statement as an indication of his current physical
condition.
D. Occupational risk classification of the client.
C14/3.6
50. Which of the following method is fairer in determining the sum assured for group health
insurance?
A. Employee’s Salary X Performance Factor

B. Employee’s Salary X Standard Factor
C. According to Rank
D. Lower position; higher sum assured.

Answers – Set A

1. D 26. C
2. D 27. A
3. D 28. D
4. B 29. B
5. B 30. B
6. C 31. A
7. A 32. A
8. A 33. C
9. B 34. D
10. B 35. C
11. A 36. A
12. B 37. A
13. A 38. A
14. C 39. D
15. B 40 B
16. D 41. C
17. C 42. A
18. C 43. D
19. B 44. B
20. C 45. A
21. A 46. C
22. C 47. C
23. B 48. C
24. A 49. B
25. D 50. B
Workings
Qn 5
Ans:
($500 + $700) X 5% = $60
Qn 7
Ans:
Mr. Tan : $15,000 - $3000 = $12,000 - $1,200 (coinsurance 10%) = $10,800
Mrs. Tan : $20,000 - $3000 = $17,000 - $1,700 (coinsurance 10%) = $15,300
Son : cannot claim as expense is below deductible
Daughter : $3,200 - $3000 = $200 - $20 (coinsurance 10%) = $180
Hence total payable = $10,800 + $15,300 + $180 = $26,280
Qn 14
Ans:
$4000 - $1500 / $4000 x $3000 = $1875

Qn 32
Ans:
MediShield Life pays =$3,957.5
Calculate co-insurance
$1,501 to $5,000 - 10% x $3,500 = $350
$5,001 to $10,000 - 5% x $850 = $42.5
Qn 48
Ans:
$3000 x 12 =$36,000 x 13.4622(table A2– 5%, 21 years)
= $484,639

Health Insurance Set B
HEALTH INSURANCE
(6th Edition)
Set B

Strictly for Internal Use Only. Materials Prepared by Julia Sim (Jan 2020).
Set B
C8/1.3
1. The healthcare financing philosophy of Singapore is not based on the:
A. Co-payment by individuals
B. Individual medical savings accounts
C. Risk-polling for catastrophic illnesses
D. Government’s full subsidies of services
C3/3.3(A2)
2. One advantages of a contributory Group Insurance plan is that the employer:
A. Has greater control over the benefit structure.

B. Has lower cost of administrative work involved.
C. Pays only part of the costs to provide the benefits.
D. Does not need to monitor regular payroll deduction.
C12/5(d) (Appendix 12A)

A. Captive Insurer
B. Direct Reinsurer
C. Direct Insurance Broker
D. Direct Reinsurance Broker
C8/6.11
4. Ms. Ang is a 40-year-old Singaporean who joined the ElderShield scheme and became
disabled resulting solely from an accident in the first 60 days of coverage.
Which one of the following statements regarding the payment of Ms. Ang’s ElderShield
benefits is TRUE?
A. The insurer will pay the benefits, as there is no waiting period.

B. The insurer will pay the benefits, as the waiting period does not apply.
C. The insurer will pay the benefits, as the disability occurred after the waiting period of 30
days.
D. The insurer will terminate the policy and refund all premiums paid, as the disability
occurred within the waiting period of 90 days.
C9/4.1
5. One of the following purposes of the Insuring Clause in a typical Health Insurance policy
serves to:
A. Restrict the coverage to the country where the policy is issued.

B. Set forth the conditions under which the benefits are payable.
C. Determine the rights of both the insured and the insurer in the contract.
D. State that the policy shall not be in force, unless the premium is paid.

C8/4.27
6. Which of the following statements regarding MediShield Life is not true?
A. It is sized for all treatments in private hospitals.

B. It has replaced MediShield scheme since 1 November 2015.
C. It automatically covers all Citizens and Permanent Residents of Singapore.
D. It is a basic healthcare insurance scheme in line with the principle of universal coverage.
C6/2.12
7. Mrs. Ang bought a Whole Life Insurance policy for the sum assured of S$300,000 when she
was 28 years old. She added on a 30% accelerated critical illness rider to the Insurance
policy.
10 years later, she successfully claimed for the critical illness benefit. Owing to the illness, she
passed away 15 years later.
Assuming that there are no bonuses in the Insurance policy, calculate the amount payable
upon Mrs. Ang’s demise.
A. S$90,000
B. S$150,000
C. S$210,000
D. S$300,000
C12/34 (Appendix 12A)

8. Under Notice No: MAS 120, an Accident and Health Insurance intermediary that is involved in
providing advice on Health Insurance policies to policy owners does not need to:
A. Conduct needs analysis.

B. Ensure the client has passed the assessment under the e-learning module.
C. Perform “Know-Your-Client” analysis.
D. Conduct a proper documentation and record keeping exercise.
C5/3.1(a)
home care and satisfies the benefit trigger is the ______ policy.
A. Fee-based
B. Service-based
C. Benefit based
D. Disability-based

C8/5.16
10. Mr. Lee, aged 45 years, purchased a Medical Insurance policy with the following breakdown in
the policy premium:
(i) MediShield Life component = S$1,000

(ii) Integrated Shield Plan by private insurer = S$1,700
Calculate the amount of premium payable by cash.
A. S$100
B. S$700
C. S$1,000
D. S$1,700
C8/3.10
11. Barry is a Central Providence Fund (CPF) member and is 55 years old as of 1 January 2017.
On the same day, he wishes to withdraw his CPF savings from his Ordinary and Special
Accounts. Which of the following advice to be given to Barry is TRUE?
A. He need not top up his Medisave Account to the Medisave Minimum Sum (MMS).
B. He needs to use the excess balances from his Special Accounts to top up his Medisave
Account to the MMS.
C. He need not top up his Medisave Account to the MMS if there is at least S$10,000 in his
Medisave Account.
D. He needs to use the excess balances from his Ordinary Account to top up his Medisave
Account to the MMS.
C2/2.5
12. Medical Expense Insurance is also known as ______ Insurance.
A. Critical Illness
C4/5(A2)
13. Under a typical Disability Income policy, where Total Disability is defined as “the insured’s
inability to perform any gainful occupation or a similar occupation for which the insured is
reasonably suited by reason of education, experience or training”, this refers to ______
disability.
A. Severity
B. Any occupation
C. Own occupation
D. Modified own occupation

C8/3.3
14. A CPF member can use his Medisave savings to pay for medical expenses incurred by his
______ who is a Singapore Citizen.
A. Godparent
B. Grandparent
C. Parent-in-law
D. Foster parent
C2/3.7
15. Mr Goh bought a family coverage plan of his Medical Expense Insurance policy. The
application was submitted at the same time. A family discount of 5% was given by the insurer.
The premiums payable were as follows:

Mr Goh: S$150
Mr Goh’s spouse: S$170
Mr Goh’s son: S$120
Mr Goh’s daughter: S$140
Calculate the total premium payable by Mr Goh:
A. S$150
B. S$304
C. S$551
D. S$580
C1/3.8
16. Within the public hospitals, patients have a choice of the different types of class wards.
Which one of the following do not received subsidy?
A. Class B1
B. Class B2
C. Class C
C8/3.13(g)(ii)
17. A young Singaporean married couple has been experiencing difficulties in conceiving their first
baby and wishes to explore the possibility of using their Medisave to pay for the Assisted
Conception Procedure (ACP) treatments. They consulted a specialist who will perform the
procedure locally, and the expected cost of such ACP treatment is S$25,000. Which one of
the following options is TRUE?
They may use their Medisave:

A. To pay for the expected cost of S$25,000 for the ACP treatments
B. Up to a lifetime limit of S$15,000 per patient to pay for the ACP treatments
C. Up to a lifetime limit of S$10,000 per patient to pay for the ACP treatments
D. Up to a lifetime limit of S$20,000 per patient to pay for the ACP treatments

C2/3.32
18. _________ limit is the maximum amount payable for any one disability as specified in a typical
Medical Expense Insurance policy.
A. Event
B. Period
C. Annual
D. Lifetime
C3/3.4
19. Which one of the following does not describe Group Insurance?
A. It is cost effective.
B. It is experience rated.
C. A master contract is issued.
D. It requires full understanding.
C8/7.10
20. Mr. Tan is a 65-year-old Singaporean concerned about paying his medical expenses in the
event of suffering from any severe disability. However, he was not eligible to join the
ElderShield Scheme when it was launched in September 2002 because he had pre-existing
disability. If Mr. Tan suffers a severe disability and assuming that his per capita household
income is S$2,000, he will qualify to receive a payout of ______ under the Interim disability
Assistance Programme for the Elderly.
A. S$150 per month for up to 72 months

B. S$150 per month for up to 60 months
C. S$250 per month for up to 72 months
D. S$250 per month for up to 60 months
C10/2.3
A. Mortality
B. Morbidity
C. Persistency
D. Sub-standard risks
C4/13.1
22. Which one of the following is NOT a factor for underwriting consideration by an insurer of
Disability Income Insurance?
A. Benefit amount
B. Insured’s occupation
C. Deferred/elimination period
D. Limitation of disability benefit

C6/2.9(g)
23. A common feature of a Critical Illness (CI) Insurance is that:
A. It acquires a cash value immediately

B. Its guaranteed premium is fixed at entry age
C. It pays a lump sum upon death of the insured.
D. There is no restriction on the usage of the CI Insurance benefit payable.
C6/4.3
24. Which one of the following circumstances will allow the policy owner of a Travel Insurance
policy, to claim for medical expense benefits while she is overseas?
A. Aesthetic surgery performed in Seoul.

B. Routine health check-up performed in New York.
C. Miscarriage expenses in America.
D. Death resulting from civil commotion in Bangkok.
C8/5.5
25. Mr. Tan is covered under MediShield Life Scheme as well as an Integrated Shield Plan (IP)
which he has bought. Mr. Tan has some concerns about both covers as he is suffering from
some pre-existing conditions. Which one of the following statements is CORRECT?
A. IP covers all pre-existing conditions, while MediShield Life does not cover such
conditions
B. MediShield Life covers all pre-existing conditions, while IP may not cover such
conditions
C. Both MediShield Life and IP cover all pre-existing conditions, but the premium for
MediShield Life is higher
D. Both MediShield Life and IP cover all pre-existing conditions, but there are sub-limits
applicable in MediShield Life.
C6/5.10
26. Which one of the following statements is most true when describing a Group Dental Care
Insurance policy?
A. It usually includes a Limitations Clause.

B. It is usually issued on a contributory basis.
C. It usually excludes pre-existing dental conditions.
D. It usually covers replacement of broken dentures.

C2/2.9(d)
27. “Hospital Miscellaneous Expenses” under a Medical Expense Insurance refers to which one of
the following?
A. Surgeon’s fee
B. Anaesthetist’s fee
C. Operating room expenses
D. Surgical implant and prosthesis
C1/2.3
28. Which one of the following is not a strategic objective of the “Healthcare 2020” Masterplan put
together by the Ministry of Health?

B. It is to enhance quality of healthcare.
C. It is to transfer healthcare cost to insurers.
D. It is to enhance accessibility to healthcare services.
C8/6.5
29. Subject to the specified withdrawal limits, a CPF Member can use his Medisave to pay for the
premiums of:
A. Hospital Cash Insurance

C. ElderShield Insurance
D. Integrated Shield Plan Rider
C2/2.9(d)
30. Under a typical Medical Expense Insurance policy, hospital miscellaneous expenses which
refer to services and supplies (other than room and board and general nursing care) provided
during a hospital stay will usually include charges for:
A. Medicines and drugs

B. Laboratory services
C. Operating room expenses
D. All of the above
C13/2.1(b) (table)
A. The FA Rep’s relationship with the prospective client depends on how well the client
likes his product.
solutions for him.

C11/3.19
32. The size and stability of the proposer’s earnings will be an important factor for the underwriting
of ______ Insurance.
A. Long-Term Care
B. Hospital Income
C. Medical Expense
D. Disability Income
C12/41(b)(Appendix 12A)
(A&H) product recommended by his insurance broker, but requests to buy another type of
A&H product instead, the insurance broker should:
A. Get the client to sign a disclaimer form, before going ahead with his request.
B. Ignore the client’s request and file a report with the insurer to whom the insurance
broker is representing
C. Go ahead with the client’s request, but document his decision and inform him that he is
D. Request the client to seek the advice of another insurance broker, to make sure that the
C7/4.19
34. ______ Model Health Maintenance Organization (HMO) is not a traditional HMO, but being
common nowadays.
A. Staff
B. Mixed
C. Group
D. Network
C8/6.2
35. A person who joined the ElderShield scheme on 1 October 2008 will received a cash payout of
________ should he requires long-term care under the ElderShield scheme.
A. S$300 per month for a maximum of 60 months

B. S$300 per month for a maximum of 72 months
C. S$400 per month for a maximum of 60 months
D. S$400 per month for a maximum of 72 months
C8/3.13(b)(ii)
36. A CPF Member aged ______ years and above can use his Medisave savings for colonoscopy
screening.
A. 45
B. 50
C. 55
D. 60

C6/2.8(d)(ii)(sup notes V1.3, Pg 2. Pt 5)

37. In a typical Critical Illness Insurance policy, the term, malignant tumor, under the standard
definition of “Major Cancers” will include:
A. Sarcoma
B. Carcinoma-in-situ
C. Suspicious malignancy
D. Pre-malignant tumor
C9/5.22
38. A type of Health Insurance contract that gives the insurer the right to refuse to renew is the
______ policy.
A. Non-renewable
B. Annually renewable
C. Optionally renewable
D. Guaranteed renewable
C2/3.6
39. Which one of the following regarding Medical Expense Insurance is true?
A. The coverage and limits are standardised across insurers.

B. It is usually attached as a rider to a Term Insurance policy.
C. It can be extended to cover the immediate family members of the insured.
D. The insured has limited choice of the hospital and ward type when he is hospitalised.
C9/5.47
40. A policy owner who has just bought a Critical Illness Insurance policy, with built-in death
benefits payable, wishes to make a nomination of beneficiaries, such that he still retains the
policy ownership and is free to change, add or remove them without their consent. Which one
of the following nominations should he make?
A. Trust Nomination
B. Revocable Nomination
C. Irrevocable Nomination
D. Recoverable Nomination
C10/2.2
41. Which one of the following is not a key factor used by the insurer in premium computation of a
Health Insurance product?
B. Mortality experience
C. Scope of benefits covered
D. Modes of premium payment

C8/7.13
42. Set up by the government in April 1993, ______ is an endowment fund to assist needy
Singaporeans who face financial difficulties with their healthcare bills.
A. Medifund
B. MediShield Life Fund
C. Community Health Assist Scheme
C7/5.1 (fig 7.4)

43. A/An ______ Model Health Maintenance Organization has the greatest cost control, but its
members have the lowest degree of choice of providers.
A. Staff
B. Group
C. Network
D. Independent Practitioners Association
C5/8.1(d)
44. Which one of the following statements regarding Long-Term Care Insurance is FALSE?
A. There is cash value or paid-up value at any time.

B. It can be issued as a rider or a stand-alone basis.
C. Its premiums are level throughout the policy term.
D. It is usually issued on a guaranteed renewable basis.
C8/3.8
45. Which one of the following BEST describes the Basic Healthcare Sum (BHS) of a CPF
member?
A. The BHS is formerly known as the Medisave Minimum Sum.

B. Any amount above the BHS will always flow to the CPF member’s Ordinary Account.
C. The yearly BHS adjustment will apply only to a CPF member who is below the age of 65
years.
D. The amount in the Medisave Account up to the BHS can be withdrawn as cash from the
age of 55 years.
C11/3.4
46. If Mr. Tan states in his Critical Illness Insurance proposal form that he is receiving treatment
for high blood pressure, the underwriter will most likely require a/an:
A. Financial report
B. Blood profile analysis
C. Attending physician’s statement
D. Supplementary lifestyle questionnaire

C6/2.8
47. Before the policy owner of a typical Critical Illness (CI) Insurance policy can be eligible to claim
the benefit amount, certain eligible criteria must be met. Which one of the following is NOT an
eligible criterion?
A. The policy must be in force.

B. The life insured must be above a certain age.
C. The critical illness must be one that is covered.
D. The critical illness must meet its specified definition.
C12/10A (Appendix 12A)

48. Under Notice No: MAS 120, Part I of the Mandatory Requirements states that no direct insurer
shall use the word “Shield” in the name, description or title of any accident and health policy
issued by the insurer, unless the policy is a ______ policy.
A. Medisave-approved
B. Medifund-approved
C. Medishield-approved
D. MediShield Life-approved
C8/4.5 (table 8.1)

49. Mr. Tan is a 35-year-old Singaporean. He was admitted to a public hospital on 1 December for
a duration of 14 days during which he underwent an urgent operation. The total claimable
amount under MediShield Life for Mr. Tan’s inpatient and surgery (after application of
deductible) was S$15,000.
The co-insurance payable by Mr. Tan under his MediShield Life is:
A. 3% of S$15,000
B. 5% of S$15,000
C. 10% of S$15,000
D. 15% of S$15,000
C11/3.11
50. In underwriting most types of Health Insurance policies, the proposer’s ______ is not a key
consideration by an underwriter.
A. Age
B. Avocation
C. Occupation
D. Financial situation

Answers – Set B

1. D 26. A
2. C 27. C
3. C 28. C
4. B 29. C
5. B 30. D
6. A 31. B
7. C 32. D
8. B 33. C
9. B 34. B
10. A 35. D
11. A 36. B
12. C 37. A
13. D 38. C
14. B 39. C
15. C 40 B
16. D 41. B
17. B 42. A
18. A 43. A
19. D 44. A
20. A 45. C
21. B 46. C
22. D 47. B
23. D 48. A
24. C 49. A
25. B 50. D
Workings:
Qn 7:
$300,000 x 70% = $210,000
Qn10:
Additional withdrawal limit is $600.
Hence $1,700 – (1000 + 600) = $100
Qn: 15
($150 +$170 +$120 +$140) x 95% = $551

HEALTH INSURANCE
(7th Edition)
Set B

Strictly for Internal Use Only. Materials Prepared by Julia Sim (Oct 2020)
Set B
C1/3.4
1. Public healthcare is the same as private healthcare in its _____________ health care.
A. primary
B. secondary
C. intermediate
D. standard
C9/3.13(c)
2. Mr. Lim was hospitalized, how much can he withdraw from his Medisave to pay for inpatient
psychiatric treatment?
A maximum of ____________ per year.

A. S$5,000
B. S$6,000
C. S$7,000
D. S$8,000
C12/3.21
3. Cognitive assessment is normally required during the underwriting stage for ___________.
A. Long Term Care Insurance.

B. Basic Medical Expense Insurance.
C. MediShield Life.
D. Disability Income Insurance.
C2/2.9(p)
4. Under Inpatient Expenses of Medical Expense Insurance, when the Insured Person is a
recipient, Major Organ Transplant Benefit covers:
A. Cost of immunosuppressant drugs

B. Cost of Surgeries
C. Acquisition of Organ
D. Recipient Costs
C12/3.41
5. Which one of the following type of underwriting is often used where the products are sold via
direct or online channel for product such as Hospital Income Plans and the applicants are
covered regardless of health.
A. Moratorium underwriting
B. Simplified Issuance offer
C. Guaranteed Issuance offer
D. Full Medical underwriting

C2/Appendix 2D/9A
6. Jen an adviser of a direct insurance broker is required to complete a minimum of _____ hours
of structured Continuing Professional Development (CPD) training before the end of each
calendar year if she wishes to provide advice on contracts of insurance in respect of shield
plans.
A. 2 hrs
B. 4 hrs
C. 6 hrs
D. 10 hrs.
C2/2.15
7. Which one of the following sentence(s) regarding Medical Expense Insurance (MEI) Policy
is/are true? MEI covers:
A. wilful miscarriages.
B. miscarriage due to ectopic pregnancy is covered.
C. miscarriages whether or not it is medically necessary
C3/2.2(c)
determining the “feel” of future claim experience?

C9/3.13e(v)
Management Programme?
A. Laboratory Tests
B. Glucometers
C. Consultations
C3/2.3
10. Group Insurance Policies have an “actively-at-work” clause, which one of the following is true
in order to be eligible to be covered in the Group Insurance Policy?
A. An employee will be covered if he is on sick leave.

B. An employee will be covered if he is on annual leave.
C. An employee will be covered only if he is at work on the day that the insurance coverage
takes effect.
D. All of the above is true.

C3/4.13(a)
11. How does the “continuation benefits” under the Transferable Medical Insurance Scheme
(TMIS) benefits the employee?
A. To continue enjoying hospitalization coverage from the termination for up to a period of

12 months.
C. Waiver of exclusion on pre-existing medical conditions when joining his new employer.
plan.
C12/3.22
12. Which of the following factor is most important for underwriting Critical Illness Insurance?
A. Family history.
B. Overall financial condition.
C. Cognitive impairment.
D. Age and gender.
C2/2.11(b)
13. Which of the following is covered under Catastrophic Outpatient Treatment in a Medical
Expense Insurance Policy?

B. Outpatient heart treatment charges
C. Outpatient cancer treatment charges
D. Outpatient tuberculosis treatment charges
C4/5.6 (A2)
14. Under a typical Disability Income policy, where Total Disability is defined as “the insured’s
inability to perform any gainful occupation or a similar occupation for which the insured is
reasonably suited by reason of education, experience or training”, this refers to ______
disability.
A. Severity
B. Any occupation
C. Own occupation
D. Modified own occupation
C4/6.16
15. In the event of a claim under Disability Income Insurance, Limitation of Benefit Clause will
not affect which type of payment?
A. Rental Income.
B. Salary from ex-employer.
C. Workman Compensation.
D. Total and Permanent Disability benefits under Life Insurance Policies.

C1/3.5
16. Under the Community Health Assist Scheme (CHAS), eligible Singapore citizens can received
________ treatments at participating General Practitioners (GPs) and dental clinics.
A. free
B. subsidised
C. basic
D. limited
C5/3.1(a)
17. Under Long Term Care Insurance Policy, “Service Based” policy pays the covered amount,
regardless of the actual cost of services received. Which type is it describing?
A. Indemnity Method
B. Expense Incurred Method
C. Monthly Benefit Method
C5/3.2(a)
18. Senior Tan bought a “monthly benefit” Long Term Care (LTC) plan and he is unable to
perform 2 of the 6 activities of daily living, how much of the LTC monthly benefit is payable?
A. 0
B. 30%
C. 50%
D. 100%
C4/6.6 & 6.9

19. What is true of the difference between “Rehabilitation Benefit” and “Rehabilitation Expense
Benefit”?
A. Rehabilitation Benefit is for payment if insured is unable to go to work.

B. Rehabilitation Benefit is for reimbursement of medical aids eg. Wheelchair.
C. Rehabilitation Expense Benefit is also known as “Partial Disability Benefit” and it
provides for a reduced benefit to the insured if he is able to return to work.
D. Rehabilitation Expense Benefit is reimbursements that includes workplace
modifications.
C5/7.4
20. Which one of the following statement(s) is/are most true?
A. ElderShield and CareShield life are compulsory.

B. ElderShield and CareShield enjoy government subsidies and incentives.
C. Supplements cover are available for all ElderShield and CareShield life.
D. ElderShield and CareShield are optional for all.

C6/4.13
21. Amy bought an Additional Benefit Critical Illness Rider of $150,000 on a Whole Life Insurance
Policy of $200,000. Which of the following statements is TRUE?
A. Upon accidental death, insurer will pay $350,000.

B. In the event of an accident that caused her to be total permanently disabled, insurer
will pay $350,000.
C. She was diagnosed with skin cancer and subsequently died 4 months later. Insurer will
pay a total sum of $350,000.
D. In the event she was diagnosed with one of Critical Illness, insurer with pay a sum
assured of $350,000.
C8/3.8(a)
22. Which one of the following methods, does Managed Healthcare Organization pre-pays the
providers a fixed amount for each member’s medical care usually on a monthly basis?
A. Capitation
B. Discounted-fee-for-service
C. Salary
D. Fee schedule
C6/5.16
23. Mr. Lim is concerned about contracting critical illnesses during the early stages. His family
history reveals that his mother is diabetic and sister is diagnosed with bipolar disorder. What
would you recommend to him?
A. Severity-based Critical Illness Insurance Plan

B. Insurance covering diabetes
C. Critical Illness Plan covering mental illness
D. Combination of Critical Illness cover
C7/2.7(A1)(a)
24. Larry bought a Hospital Cash Insurance Policy on 1 Jan 2019, with a waiting period of 30
days. He was hospitalized on 28 Jan 2019. Upon the happening of which one of the following
situations can he claim from the insurance company?
A. Kidney failure
B. Miscarriage
C. Hip fracture
D. None of the above as he was unable to claim.
C2/2.22
25. Mr. Tan is 45 years old and works as a bus driver. He lives in a one-room flat. Recently he got
into an accident and was hospitalised for 5 days in a "C" class ward of a government hospital.
The total hospital bill of $3,000 as charged by the hospital, is fully reimbursed by the insurer.
Which of the following insurance policy is most likely the one that he has purchased?

B. Hospital Cash Insurance
D. Critical Illness Insurance

C7/2.11(f)
26. Which of the following regarding Standalone Hospital Cash Insurance is false?
A. Free death benefit

B Triple payment if hospitalized overseas due to accident
C. Double payment if under Intensive Care Unit
D. Get well benefit
C9/3.13(a)(ii)
27. Medisave can be used to pay for daily hospital charges in approved public and private
hospitals. How much Medisave savings can a CPF member withdraw per day for daily
hospital charges?
A. $250
B. $350
C. $450
D. $550
C8/6.2
28. For a fixed annual premium, insurer offer Managed Healthcare Plans which provides their
policyowners with some benefits. Which of the following is Not a benefit under this Plan?
A. Primary Care
B. Preventive Care
C. Emergency Care
D. Inpatient Care
C9/3.3
29. Medisave can be used to pay for medical expenses for all CPF members except
________unless they are Singapore Citizen or Singapore Permanent Resident.
A. Grandparents
B. Children
C. Parents
C5/9.1(e)
30. The following are exclusions under Long Term Care Insurance Policies EXCEPT:
A. All pre-existing conditions, which were not fully declared and described by the insured at
the time of application.
B. Alcoholism and drug abuse.
C. Any form of Acquired Immune Deficiency Syndrome (AIDS) or infection by any Human
Immunodeficiency Virus (HIV).
D. Self-inflicted injury.

C9/4.23, 4.24
31. Mary a Singapore Citizen is covered under MediShield Life for stay in B2 class ward in a
public hospital. Upon her hospitalisation she chose to stay in a Class A ward in a private
hospital. Which factor(s) will particularly cause Mary to pay out more from her own pocket?
A. Deductible
B. Co-insurance
C. Pro-ration
D. All of the above
C12/3.9
32. Medical Aspects of Underwriting requires the consideration of ___________.
A. Financial Factors
B. Current Physical Condition
C. Occupational Factors
D. Age Factors
C6/3.2
33. The CI Framework was the result of which one of the following to govern the provision of
Critical Illness coverage by the insurers?
A. Monetary Authority of Singapore

B. Life Insurance Association
C. General Insurance Association
D. All of the above
C9/5.30
34. What is true of the Letter of Guarantee (LOG) provided by an Integrated Shield Plans (IPs)?
A. It is a pre-authorization process for IPs.

B. Patients will have peace of mind to know that their procedure is within their insurance
coverage.
C. It waives the upfront cash required by the hospital.
D. It is a service provided for all insured members to ease the admission process to the
hospital.
C11/3.13
35. Which one of the following statements about parameters in pricing of Health Insurance is
true?
A. Increase in proportion of females in a group will reduce the premiums.

B. Increase in morbidity experience will reduce premiums.
C. Increase in persistency will decrease premiums.
D. Increase in participation rate will increase premiums.

C10/3.2
contract. Which one of the following details is found in the Policy Schedule?
A. Name of insurance plan

B. Name of Insurer
C. Name of beneficiary
D. All of the above
C10/4.1
37. Which one of the following sections in a Health Insurance Policy contract is often viewed as
the insurer’s promises to pay under the conditions specified in the policy?
A. Operative clause
B. Policy schedule
C. Generation conditions
D. Endorsements
C10/5.15

C11/2.3
A. Mortality
B. Morbidity
C. Persistency
D. Sub-standard risks
C15/3.5
40. For a prospective client buying a Group Term Life Insurance for the first time, which method
does not take into account the length of service of the employees?
A. Number of times of the employee's basic salary.

B. According to rank.
C. Both A & B

C1/3.12
treatment after being discharge from the hospital, who may need assistance with their
activities of daily living. This can be through:

D. All of the above
C12/3.4
42. If Mr. Tan states in his Critical Illness Insurance proposal form that he is receiving treatment
for high blood pressure, the underwriter will most likely require a/an:
A. Financial report
B. Blood profile analysis
C. Attending physician’s statement
D. Supplementary lifestyle questionnaire
C8/4.21
43. Which of the following best describes Preferred Provider Organisations(PPOs) under
Managed Healthcare Plans?
A. PPOs are gatekeepers.

B. PPOs allow clients to see specialist with referrals.
C. PPOs require greater “out of pocket” payments from members.
D. PPOs allow clients to choose to stay in the network or outside the network at point of
service.
C13/2.1
44. MAS Notice No: MAS 120 comprises both mandatory requirements and best practice
standards on the disclosure of information and provision of advice to policy owners for:
A. Life Policies only

B. Accident and Health (A&H) Policies only
C. A&H Policies and Life Policies that provides A&H benefits
D. A&H Policies, Investment- Linked policies and Universal Life policies

effectively monitor and track switching of long-term accident and health plans. Which is true
of such process?
A. Track the volume of switches so as to identify any A&H insurance reps with an unusually
high volume of switching transactions.
B. Ensure supervisor reviewed each switch recommended.
C. Identify any unusual trends in switching transactions.

C14/2.1(b) (table)
A. The FA Rep’s relationship with the prospective client depends on how well the client
likes his product.
solutions for him.
C14/4.2
47 Why is an emergency fund important for the client?
A. Act as a safeguard against retrenchment.

B. Act as a fund to invest in future speculative assets for retirement.
C. To help purchase big ticket items such as down payment for a house.
D. To help purchase more policies to invest for future retirement.
C4/6.7, Eg 4.2
per month. What would Mr Tan’s disability income benefit be?
A. $3,000 per month

B. $2,500 per month
C. $1,875 per month
D. $4,000 per month
C9/4.24, Table 9.2


Deductible = $1,500
From $0- $5000 - 10%
From $5,001 to $10,000 - 5%
More than $10,000 - 3%
A. $3,958
B. $3,915
C. $4,350
D. $4,133

C14/4.13 Eg 14.3
A. $630,775
B. $47,632
C. $484,639
D. $554,940

Answers – Set B

1. A 26. A
2. A 27. C
3. A 28. D
4. B 29. A
5. C 30. C
6. A 31. C
7. B 32. B
8. B 33. D
9. B 34. C
10. C 35. C
11. A 36. A
12. A 37. A
13. C 38. A
14. D 39. B
15. D 40 B
16. B 41. D
17. A 42. C
18. C 43. C
19. D 44. C
20. C 45. D
21. C 46. B
22. A 47. A
23. D 48. C
24. C 49. A
25. C 50. C
Workings:
Qn 48
$4,000 - $1,500 / $4,000 x $3,000 = $1,875 (ans is C)
Qn 49
MediShield Life pays =$3,957.5 (ans is A)
* Calculate co-insurance
Apply 1st tier $1,501 to $5,000 hence 10% x $3,500 = $350
Apply 2nd tier $5,001 to $10,000, hence 5% x $850 = $42.5
Qn 50
$3,000 x 12 = $36,000 x 13.4622 (table A2– 5%, 21 years)
= $484,639 (ans is C)

HEALTH INSURANCE
(7th Edition) – July 2020
Set A

Strictly For Internal Use. Materials Prepared By Julia Sim (1 Oct 2020)
Set A
C1/3.4
1. Primary healthcare services involve the provision of basic medical treatment, preventive care
and health education. These services are provided by _________________ in Singapore.
A. Public sector
B. Private sector
C. Public and private sectors
C10/8.5
2. “Physical Examination Provision” is included in Disability Income Policies to enable insurer
to _________________.
A. have the insured examined by the insurer’s doctor at the insured’s expense.
B. have the insured examined by the insured’s doctor at the insurer’s expense.
C. have the insured examined by the insurer’s doctor at the insurer’s expense.
D. have the insured examined by the insured’s choice of doctors on a contributory basis.
C11/3.15
3. The participation by employees in the plan is an important parameter in premium rates. If the
participation is _________, there will be a greater chance that a _________ than normal
proportion of unhealthy lives seeking coverage.
A. low; lower
B. high; higher
C. low; higher
D. good; greater
C2/3.29
4. Mr. Roy Lim bought a Medical Expense Insurance Policy with the following details:
Plan entitlement: Restructured hospital – any standard B1 ward, as charged basis.
Hospitalization : Private hospital in Singapore
Pro-ration factor : 35%
Annual Deductibles: $3,500
Co-insurance: 10%
Ward of discharge: Standard single bed
Total expenses incurred

 Daily room and board and medical related services : $4,000
 Surgical benefits : $20,000
Total Bill : $24,000
How much will the insurer pays under this policy?
A. $15,000
B. $11,610
C. $8,400
D. $4,410

C9/7.17, 7.24, 7.29

5. Jack born in 1980, bought an insurance plan with these features:
 Pays a monthly benefit of $600 if he is severely disabled;
 Will be terminated if he is no longer a Singapore Citizen or Singapore Permanent
Resident;
 Provides worldwide coverage;
 Can receive a premium subsidy of up to 30% of his premium if he is a Singapore Citizen.
What did he buy?

A. CareShield
B. ElderShield 300
C. ElderShield 400
D. Long Term Care Insurance Policy
C3/3.2, Table 3.1

6. Mr. Tan would like his wife to be included under his company’s Group Medical Insurance
Policy. What would the commencement date of cover for Mrs. Tan be?
A. Anytime within 30 days after marriage.

B. Anytime within 15 days after marriage.
C. Anytime within the half year after marriage.
D. Anytime as and when Mr. Tan apply for her to be included and cover approved through
underwriting.
C3/4.5
7. Which of the following describes Portable Medical Benefit Scheme (PMBS)?
A. It rides on Medisave/ Medishield framework , as employees makes an additional

monthly contribution to his Medisave account to buy medical insurance.
B. Employees are medically insured even though he may be unemployed or is in between
jobs.
C. To be eligible for the tax deduction, the scheme must cover 100% of all local employees,
as at the first day of financial year being assessed.
D. For part- time employees, the monthly Medisave contribution should be based on 2% of
their actual salary.
C4/4.1, Eg 4.3
8. Andrew, an engineer became disabled and unable to go to work. Compute his total Disability
Income Benefit. Given the following details:
Escalation Benefit: 3%
Monthly Income: $5,000
Monthly Expense: $3,000
No of year: 30 years
A. $1,141,809
B. $1,712,714
C. $2,140,893
D. $2,854,524

C8/3.2
9. Which component of managed healthcare is not used to contain and control healthcare
expenditure?
A. Accessibility
B. Cost
C. Quality of Care
D. Wide healthcare coverage
C4/5.8
10. Which of the following is most stringent definition of “Total Disability” under Disability Income
Insurance?
A. Own Occupation
B. Any Occupation
C4/8.8
likely to:

renewable.
C1/2.2(A)(B)(C)
healthcare services for Singaporeans. The focus is on ______________________.
A. enhancing accessibility
B. enhancing quality of care
C. ensuring healthcare remains affordable
D. all of the above
C5/3.1(a)
home care or nursing care and satisfies the benefit trigger is the ______ policy.
A. Fee-based
B. Service-based
C. Benefit based
D. Disability-based

C12/3.11
14. In underwriting most types of Health Insurance policies, the proposer’s ______ is not a key
consideration by an underwriter.
A. Age
B. Avocation
C. Occupation
D. Financial situation
C5/3.5(b)
15. The premiums will be ______, the lower the number of ADLs which the insured is required to
be unable to perform to qualify for the benefits.
A. lower
B. higher
C. the same
C1/2.5
16. What is the driving demand for healthcare in Singapore?
A. Ageing population
B. Doctor- centric services
C. Manpower capability
D. Infrastructure expansion
C5/4/1.2(c)
17. When a person requires an assistive rehabilitation devices (eg wheelchair), which one of the
following benefits under a Long Term Care plan could provide for it?
A. Rehabilitation Expense Benefit

B. Extended Care Benefit
C. Surgical and Prosthesis Device
D. Financial Assistance with Adaptation
C6/8.1(e)
18. Which one of the following events will cause the policy owner’s critical illness cover to be
terminated under a Critical Illness Insurance Policy?
A. When the policyowner exercise paid up option under Non forfeiture option.
B. When the policy is converted into an Extended Term Insurance Policy.
C. When the insured is diagnosed with a critical illness.
D. When an invalid critical illness claim has been made.

C7/2.2
19. Richard bought a Hospital Cash Income Insurance Policy, with these policy details:
Daily Benefit : $100

Max of 180 days per hospitalization
Lifetime Limit : 1,000 days
He was hospitalized for a total 185 days for a car accident injury. Calculate the total
maximum amount Richard can claim from this policy.
A. $100,000
B. $18,500
C. $18,000
D. $180,000
C7/4.11(d)
20. Cover for each individual insured employee under a Group Dental Care Insurance Policy will
automatically terminate under which event?
A. Insured enters full time military service.

B. Insured exercises one of the non-forfeiture options.
C. Insured could claim from other sources like Workmen Compensation.
D. Insured reaches age 60.
C2/3.7
21. Mr. Lim is buying a policy for himself and his wife and 2 children of the same premium each.
What is the premium payable given the following?
Mr. Ang’s premium $182.31

Mrs. Ang’s premium $227.89
1 child’s premium $102.50
A. $512.70
B. $584.44
C. $615.20
D. $487
C2/Appendix 2D/1a
22. Notice MAS 117 on Training and Competency Requirements: Health Insurance applies to
which one of the following which carries on a business in relation to health insurance
products?
A. a direct insurance broker

B. a licensed financial adviser
C. an exempt financial adviser
D. all of the above

C8/4.19
23. ______ Model Health Maintenance Organization (HMO) is not a traditional HMO, but being
common nowadays.
A. Staff
B. Mixed
C. Group
D. Network
C5/3.2(b)
24. Which of the following is by far the most common type of Long Term Care Insurance Plan
found in Singapore?
A. Monthly Benefit Policy

B. Annually Benefit Policy
C. Quarterly Benefit Policy
D. Daily Benefit Policy
C8/7.1
25. Which one of the following is Most true of Managed Healthcare Insurance (MHC) in
Singapore?
A. MHC arrangements are not common in Singapore.

B. The general practitioners do not act as a gatekeeper.
C. Employees enjoy cashless facilities for selected panel & non-panel clinics.
D. For an employee under MHC, the cost is partially covered subject to co-payments
and/or benefit limits.
C12/6.4(i)
26. Which one of the following plans will the underwriter most likely used exclusions for sub-
standard risks?
A. Disability Income Insurance.

B. Critical Illness.
D. Personal Accident.
C4/6.9
27. Rehabilitation Expense Benefit under Disability Income Policy does not refer to payment for:
A. Medical Aids
B. Training Courses
C. Workplace Modifications
D. Partial Disability Benefit

C6/3.1
28. Which one of the following regarding the LIA Critical Illness Framework 2019 (“The CI
Framework’) is /are true?
A. Seeks to improve the interests of the consumers in the claim of critical illnesses.
B. Seeks for easier product comparison by insurers.
C. Seeks for consistent outcomes for underwriters in accepting proposals.
D. Seeks to reduce ambiguity of the same CI claim being paid by one insurer but rejected
by another.
C6/4.1(d)(ii)
29. In a typical Critical Illness Insurance policy, the term, malignant tumour, under the standard
definition of “Major Cancer” will include:
A. Sarcoma
B. Carcinoma-in-situ
C. Suspicious malignancy
D. Pre-malignant tumour
C9/3.13e(iv)
30. Medisave can be used to pay for which expenses under Chronic Disease Management
Programme?
A. Wheelchairs
B. Prostheses
C. Eye screening
D. All of the above
C5/7.3 & 9.3

31. Mr. Lim was born in Jan 1979, which one of the following is most true of his situation?
A. He is allowed to join CareShield Life if he is not severely disabled.

B. He is allowed to be covered by both ElderShield and CareShield Life if he is not severely
disabled.
C. It is compulsory for him to join CareShield Life as he is a Singaporean.
D. He is not allowed to join CareShield Life as he is already covered under ElderShield.
C9/4.28
32. Larry suffered a depression and is concerned about his gender. Later, he successfully
changed his gender. Before going overseas, she took a vaccination on dengue fever but she
contracted yellow fever in Africa. What can Larry claim from MediShield?
A. Depression
B. Sex Change
C. Vaccination for dengue fever
D. Yellow fever in Africa

C10/5.22
33. John bought a Conditionally Renewable Health Insurance Policy. Shortly after that, he was
diagnosed with cancer. The insurer __________________.
A. can refuse to renew his policy as his health conditions change

B. can refuse to renew his policy as it is considered pre-exisiting conditions.
C. should renew his policy.
D. should renew his policy and charge a higher premium.
C12/3.21
34. The detection of any early cognitive impairment is essential when underwriting which product?

C13/5(d) (Appendix 13A)

A. Captive Insurer
B. Direct Reinsurer
C. Direct Insurance Broker
D. Direct Reinsurance Broker
C9/5.13, 6.6
36. Richard, 55 years old, wishes to use his CPF Medisave to finance his Integrated Shield plan
with an annual premium of $2,500; ElderShield with an annual premium of $300; and
ElderShield Supplements with an annual premium of $1,000.
Assuming the applicable withdrawal limits (per person per year) for the following Medisave
Approved Medical Insurance plans are:
MediShield Life: No limit
Integrated Shield Plan: $600 (age 41 to 70 years old)
ElderShield: No limit
ElderShield Supplements: 600
Calculate the total amount Richard will have to pay in cash after withdrawing the maximum
amount from his Medisave?
A. $0
B. $1,200
C. $2,300
D. $2,900
C10/4.2
37. Which one of the following sections in a Health Insurance Policy contract represents the
“foundation” of a Health Insurance Policy?
A. Policy Schedule
B. General Conditions
C. Insuring Clause
D. Benefits Provisions

C14/3.3(b)

C13/41(b)(Appendix 13A)
(A&H) product recommended by his insurance broker, but requests to buy another type of
A&H product instead, the insurance broker should:
A. Get the client to sign a disclaimer form, before going ahead with his request.
B. Ignore the client’s request and file a report with the insurer to whom the insurance
broker is representing
C. Go ahead with the client’s request, but document his decision and inform him that he is
D. Request the client to seek the advice of another insurance broker, to make sure that the
C11/2.2
40. Which one of the following is not a key factor used by the insurer in premium computation of a
Health Insurance product?
B. Mortality experience
C. Scope of benefits covered
D. Modes of premium payment
C9/4.5 (table 9.1)

41. Mr. Tan is a 35-year-old Singaporean. He was admitted to a public hospital on 1 December for
a duration of 14 days during which he underwent an urgent operation. The total claimable
amount under MediShield Life for Mr. Tan’s inpatient and surgery (after application of
deductible) was S$15,000.
The co-insurance payable by Mr. Tan under his MediShield Life is:
A. 3% of S$15,000
B. 5% of S$15,000
C. 10% of S$15,000
D. 15% of S$15,000
C9/5.26
42. The LIA issued a guidance paper on Pre-Authorization Process for Integrated Shield Plans
(IPs). What is /are the benefits in having pre-authorization?
A. Insurers can access the medical necessity and cost of treatment.

B. Peace of mind to the patient.
C. Offers clarity to healthcare providers on types of procedures covered by insurance prior
to the actual procedure.
D. All of the above

C12/2.1
43. Underwriters help the insurer assess the risk and determine whether or not to accept an
application, and if so, on what terms it will offer. Hence the role of underwriters are to
______________.
A. help to protect the insurer against anti-selection and in the preservation of the insurer’s
reserves.
B. ensure that the premium charged corresponds with the risk involved.
C. ensure the re-insurance limits will not be exceeded.
D. ensure that the premium charge is fair.
C12/3.37
44. Mrs. Tan was asked by the insurer only a few questions when applying for coverage. Her
answers to those questions will determine whether the application is approved or not, as well
as the cost of the policy. She was not sent for any medical examination. What type of
underwriting is she subjected to?
A. Moratorium Underwriting
B. Simplified Issuance offer
C. Guaranteed Issuance offer
D. Full Medical Underwriting
C2/2.5
45. Medical Expense Insurance is also known as ______ Insurance.
A. Critical Illness

46. To facilitate the monitoring of switching for Long-Term Accident and Health Policies, that may
be detrimental to a policy owner's interests, the A&H insurance intermediary should ensure
____________________.
A. the A&H rep has declared in writing that the policy owner agreed to the switch.
B. the policy owner has declared in writing whether he has been advised by the A&H rep to
switch.
C. Both are correct
D. Both are incorrect
C2/2.9(a)
47. Daily Room and Board Charges are covered under Inpatient Expenses of a Medical
Expense Insurance Policy. Which of the following is NOT covered under Daily Room and
Board Charges?
A. Accommodation
B. Meals
C. General Nursing Services
D. Medicines and drugs

C14/3.3(f)
48. What serves as a starting or reference point for the advisers to recommend further A & H
insurance recommendations to their clients?
A. Client’s existing Health Insurance Policies

B. Client’s pay increase
C. Client’s promotion
D. Client’s affordability
C14/4.13, Eg 14.3
49. Miss X’s monthly income and expenses are $4,000 and $3,000 respectively. She is 32 years
old, single and would like to provide for herself till retirement (55 years old) in the event of
disability. She has an existing $100,000 Whole Life Insurance. Given an inflation rate of 2%
and interest rate of 4%, calculate the maintenance cost needed.
A. $795,586
B. $571,688
C. $671,688
D. $445,530
C15/2.5
50. The most suitable product for meeting Maintenance Cost is _____________.

B. Dread Disease
C. Hospital Cash Insurance
D. Managed Healthcare Insurance

Answers – Set A

1. C 26. C
2. C 27. D
3. C 28. D
4. D 29. A
5. A 30. C
6. A 31. A
7. B 32. A
8. C 33. C
9. D 34. C
10. B 35. C
11. B 36. C
12. D 37. C
13. B 38. C
14. D 39. C
15. B 40 B
16. A 41. A
17. D 42. D
18. B 43. B
19. A 44. B
20. A 45. C
21. B 46. B
22. D 47. D
23. B 48. A
24. A 49. B
25. A 50. A
Answers – Working
Qn 4
Annual deductibles given: $3,500
Pro-ration = 35% x $24,000 = $8,400
Co-insurance: 10% ($8,400 - $3,500) = $490
He pays : $3,500 + $490 +$15,600 (65% x $24k) = $19,590
Insurer pays : $24,000 - $19,590 = $4,410 (ans is D)
Qn 8
$5,000 x 75% = $3,750
$3,750 X 12 x *47.5754 = $2,140,893
* 47.5754 (factor from Table A1 – 3%; 30 years)(ans is C)
Qn 19
Lifetime limit of $1,000 days X $100 per day = $100,000 (ans is A)
Qn 21
($182.31 + $227.89 + $102.5 + $102.5) X 95% (enjoy family discount of 5%) = $584.44 (ans is B)

Qn 36
IP premium to be paid in cash = $2,500 - $600 = $1,900
ElderShield Supplement to paid in cash = $1,000 - $600 = $400
Hence total = $1,900 + $400 = $2,300 (ans is C)
Qn 49
Ans:
$3,000 x 12 = $36,000 x 18.6580 (table A2– 2%; 23 yrs)
$671,688 - $100,000 = $571,688 (ans is B)


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Health Insurance Strictly for Internal Use Only

Prudential Assurance Company Singapore (Pte) Limited 1

Chapter 1 – Overview of Healthcare Environment in

B. Enhancing Quality Of Care

• Building more polyclinics.

Prudential Assurance Company Singapore (Pte) Limited 2

C. Ensuring Healthcare To Remain Affordable

• Increasing Government share of national healthcare expenditure - through enhanced

• Enhancing collective responsibility for healthcare through MediShield Life.

3. Healthcare System in Singapore

2. In public sector, primary healthcare services are provided through network of

Prudential Assurance Company Singapore (Pte) Limited 3

accurate picture of operating costs, instilling greater financial discipline and

C. Intermediate & Long Term Care (ITLC)

c) Residential ILTC services, comprises community hospitals, chronic sick hospitals,

Singapore Healthcare Financing Framework

Government Subsidies Individual Savings Insurance

Government provides Through the Medisave • MediShield Life

b) Compulsory Healthcare Savings

Prudential Assurance Company Singapore (Pte) Limited 4

c) Risk-Pooling via Insurance Schemes

d) Ultimate safety net for the needy

Prudential Assurance Company Singapore (Pte) Limited 5

Chapter 2 – Medical Expense Insurance

• A periodic income upon disability or hospitalization; or

• A fixed cash amount upon disability or suffering from a major illness.

2. Insurers and their financial adviser representatives providing advice on or arranging

2. What is a Medical Expense Insurance (MEI)?

A1. What Is Covered Under MEI?

(i) Inpatient Expenses: (ii) Outpatient Expenses

(iii) Catastrophic Outpatient Expenses

 Outpatient kidney treatment charges;

Prudential Assurance Company Singapore (Pte) Limited 6

A2. Inpatient Expenses

f. Anaesthetist’s Fees – for the supply and administration anaesthesia.

i. In-Hospital Psychiatric Treatment – must be received as an inpatient of the hospital.

j. Congenital Anomalies – inpatient treatment of any congenital anomalies, including

k. Inpatient Pregnancy Complications – inpatient treatment for pregnancy complications.

Prudential Assurance Company Singapore (Pte) Limited 7

m. Stem Cell Transplant

n. Emergency Overseas Inpatient Treatment

o. Accident Inpatient Dental Treatment

p. Major Organ Transplant

q. Living Donor Organ Transplant

(i). Transplant is carried out in a hospital in Singapore;

Prudential Assurance Company Singapore (Pte) Limited 8

A3. Outpatient Expenses

b. Pre- hospitalization Specialist Consultation Charges

c. Post – Hospitalization Specialist Consultation Charges

d. Accident & Emergency (A & E) Treatment

e. Emergency Accidental Treatment Charges

A4. Catastrophic Outpatient Expenses

b. Outpatient Cancer Treatment Charges

c. Major Organ Transplant Approved Immunosuppressant Drugs

Prudential Assurance Company Singapore (Pte) Limited 9

B. Other Benefits Under MEI

1. Specific Disease Insurance