Singaporeans on the national long-term care insurance scheme CareShield Life will face higher premiums and higher payouts from 2026, the Ministry of Health (MOH) announced on 27 August 2025.
Between 2026 and 2030, premiums will rise by an average of S$38 annually, with some policyholders seeing increases of up to S$75 each year, according to MOH.
The government said the rise was necessary to sustain enhanced benefits, but that transitional support would be provided to keep the scheme affordable.
Doubling of payout growth rate
CareShield Life payouts currently grow at 2 per cent annually.
From 2026, this rate will double to 4 per cent, while eligibility criteria will remain unchanged.
This means that by 2030, a policyholder making a claim will receive S$806 per month, compared to S$731 under the old growth rate.
“This will help payouts better keep pace with rising long-term care costs, providing Singaporeans with greater assurance for their long-term care needs,” said Jeanette Wong, chair of the CareShield Life Council that conducted the scheme’s first review.
Financial impact and support measures
To support policyholders, the government has committed S$570 million in transitional assistance.
Of this amount, S$440 million will moderate the premium increases for all affected individuals, while S$130 million will go towards enhanced subsidies of up to 30 per cent for low- to middle-income policyholders.
Without this support, annual premiums would have increased by S$126 on average in 2026, MOH said.
“The government is committed to helping Singaporeans manage the upcoming premium increase, and will ensure that no one will lose coverage due to an inability to pay their premiums,” the ministry stated.
Background of the scheme
CareShield Life was launched in 2020 to replace the ElderShield scheme.
It provides monthly cash payouts to individuals with severe disabilities, defined as the inability to perform at least three out of six daily living activities, including feeding, washing, and dressing.
The scheme is compulsory for those born in 1980 or later. Older cohorts have the option to enrol voluntarily.
When the scheme was introduced, payouts started at S$600 per month and grew by 2 per cent annually.
From 2025, claimants will receive S$662 per month under the current system.
Current coverage and claims
As of June 2025, 1.93 million Singapore citizens and permanent residents aged 30 and above are covered under CareShield Life, while 535,000 remain covered under ElderShield.
This translates to around eight in 10 individuals in that age group having coverage under one of the two schemes.
There were 1,821 active claimants under CareShield Life in 2024, with payouts totalling over S$26 million. Claimants ranged from 30 to 93 years old, with a median age of 52.
According to MOH, this means about half of claimants are in their 30s and 40s.
Rising long-term care costs
Singapore’s national expenditure on long-term care has nearly doubled in the past five years, climbing from S$1.7 billion to around S$3 billion.
MOH attributed this rise to the ageing population, more seniors requiring long-term care, and higher costs linked to manpower and technology. Inflationary pressures have also contributed.
Among those who develop severe disabilities, half are expected to remain in that state for at least four to five years, while three in 10 may remain disabled for 10 years or longer, MOH noted.
Pre-funding model explained
As of December 2024, CareShield Life had collected S$2.8 billion in premiums, including about S$800 million in government premium support.
Total claims paid under CareShield Life and ElderShield since 2020 exceeded S$100 million.
MOH explained that the current low payout ratio was expected, since premiums collected now are intended to fund future obligations as policyholders age and claims rise.
This structure is in line with the design of CareShield Life as a pre-funded scheme.
Review and recommendations
Earlier in 2025, Second Minister for Health Masagos Zulkifli announced the first review of CareShield Life.
The review concluded with several recommendations, all of which were accepted by the government.
These included doubling the annual payout growth rate, introducing transitional support for premiums, and reinstating underwriting criteria for enrolment.
Changes to enrolment from 2026
At its launch, CareShield Life allowed older individuals with mild or moderate disabilities to enrol under a temporary measure.
From 2026, this option will be removed. Only those without pre-existing disabilities will be able to join the scheme.
Individuals with chronic conditions such as diabetes may still enrol, provided they are not disabled.
MOH explained that this reinstatement of underwriting was recommended as the extended grace period had seen dwindling sign-ups among older cohorts.
Balancing affordability and accessibility
When asked about calls to ease claim criteria by reducing the threshold from three daily living activities to two, Jeanette Wong said that CareShield Life was a not-for-profit scheme with limited premium collection years but lifetime payouts.
Focus group discussions highlighted the importance of affordability. The council noted the need to balance accessibility with fairness and sustainability.
MOH also emphasised that individuals seeking greater coverage could turn to private insurance products with lower thresholds, provided they were willing to pay higher premiums.
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