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Reform is underway in Singapore for Worker’s Compensation Insurance (WIC) and Life Insurance. We’ll outline what these changes are, why they matter and how they could impact your organisation.
Changes to Worker’s Compensation
Back in September 2019, the Singapore Government announced various enhancements in benefits and changes to insurance requirements, which resulted in increases in premium ratings from 1 Jan 2020. This year, the Ministry of Manpower (MOM) announced further changes.
Under the latest changes, insurance providers must be registered and licensed to underwrite WIC. There will also be changes to the claims handling processes, along with increased responsibility and administration for insurers. These changes are likely to contribute to increased premiums (predicted to be 10% across the board), with harsher increases being felt by clients with poor loss histories and those in more hazardous occupations.
In response to the legislative changes and the new conditions brought about by COVID-19, Underwriters are developing new products specifically designed for people working from home, including coverage for:
With these changes in mind, this is an ideal time to perform a full review of your Worker’s Compensation policy, proposal forms and classification of employees.
Changes to Critical Illness Definition
From August 26, 2020, all new group critical illness plans will adopt the updated set of definitions for the standard list of 37 critical illnesses set by the Life Insurance Association Singapore (LIA). Out of the 37 critical illnesses defined under the LIA Singapore framework, changes were made to the 14 headers and 21 definitions. These changes have impacted most of the major conditions, which account for about 90% of claims.
Standardisation of critical illness definitions was first introduced by LIA in 2003. In the previous (2014) update, some of the 37 severe stage critical illness definitions were revised; and the maximum limit of 30 medical conditions per critical illnesses plan was abolished to allow for more medical conditions to be covered.
This latest review specifically addresses ambiguities that have arisen due to medical advancements and health trends in the past five years. Reviews will be conducted every three years to ensure critical illnesses products remain relevant and that the intended scope of coverage is clear to consumers.
Why is Critical Illness Insurance Important for Employees?
A study by the World Health Organisation in 2018 showed that the 2 main causes of death – cardiovascular diseases and cancer – account for 59% of all deaths in Singapore. Of those deaths, 30% are caused by cancer and each day, 36 people in Singapore receive a positive cancer diagnosis.
An increasing number of businesses find Critical Illness insurance provides their employees relief from the financial burden that can accompany a major illness. With this coverage in place, employees receive a lump-sum pay-out upon diagnosis of a critical illness condition as such a stroke, cancer, or heart attack. This is especially important if the illness means the employee is unable to continue working. Group Critical Illness insurance covers employees who are diagnosed with any of the 37 critical illness conditions.
Feel free to reach out to discuss your business needs. We’re experts in Insurance, Advice and Support.
Cassaundra Tan
Client Manager – Employee Benefits
Melanie Chong
Client Manager – Commercial Asia
