ElderShield and Critical Illness Insurance are two different types of health insurance products, catering to very different needs.
Below is some basic information:
This is a national severe disability insurance scheme which provides basic financial protection to those who need long-term care, especially in old age. It provides a monthly cash payout to help fund the out-of-pocket expenses for the care of a severely disabled person.
Singaporeans and Permanent Residents with Medisave accounts are automatically covered under ElderShield at the age of 40. ElderShield premiums can be funded by Medisave, up to the prevailing withdrawal limit set by the Ministry of Health (MOH).
The MOH has appointed 3 insurance companies to administer the scheme. They are Aviva; Great Eastern Life; and NTUC Income.
Critical Illness (CI Insurance
This type of insurance pays a lump sum either when a person first diagnosed with a disease covered by the policy or after first having a type of surgery covered by the policy. The type of disease covered by the CI policies may vary from one insurer to another, but the common ones would include major cancers, heart attack, coronary artery bypass surgery, and stroke and kidney failure. The benefits are paid only if the disease or surgery exactly meets the definition in the policy.
Medisave monies cannot be used to pay for CI premiums.
So, for example, if you are looking to reduce the financial burden when you are diagnosed with a major illness, then a CI policy is appropriate.
With regard to the specific situation of your grandfather, we suggest that you consult a financial adviser for professional advice before opting out, as once out, it will be difficult to opt in again.
Posted by Life Insurance Association of Singapore on 30/11/2011