6/06/2014
CPF Life and Medishield Life – Two life savings schemes
The CPF Life and Medishield Life are two of the greatest insurance schemes thought of by the Govt. The two schemes help to solve two of the most costly and serious living problems of the people, one to have money to live during retirement, and the other to have money to pay for medical bills that could make the HDB millionaires bankrupt even after selling their flats. The people can now live in peace, sleep in peace because of these two great schemes.
How much more would it cost if these two schemes were private insurance schemes? The three most important cost of private insurance schemes are commissions for the agents, bonuses for the over riding top management and profits. Oh, there is another cost, operating cost, marketing cost and overheads. With the two compulsory schemes, the cost must be very low as there is no need for much marketing, and lower operating cost as everything can be computerized under one roof. There will be minimal marketing and sales staff that private insurers would need.
Without the insurance agents and their overriding managers, this middle man cost would also be removed. And without the profit motive, the premiums could be really low, to cover just the necessary. Tiok boh?
How can private insurers compete in operating cost against compulsory insurance schemes offered by the Govt? These savings can easily be worked out and must be quite substantial. I am not an expert in insurance, but people like Tan Kin Lian could easily show us some numbers between private insurers and the CPF Life and the coming Medishield Life for comparisons. Say if the private insurer is charging $1k, by removing the agent commission, overriding commission, marketing, sales, profits, etc, how much should the net number be?
A compulsory scheme surely need not have to pay commission and profits and high marketing and sales cost, no middleman cost and NO profits. So, how much are the CPF Life and Medishield Life premiums compare to those of private insurer’s, apple to apple? Or are the premiums the same or the difference marginable?
No savings from economy of scale? I will be damn if the premiums work out to be similar. I will fall off my chair if compulsory schemes actually ended up paying more.
Kopi Level -Green
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22 comments:
"No savings from economy of scale? I will be damn if the premiums work out to be similar. I will fall off my chair if compulsory schemes actually ended up paying more."
RB
So what if premiums work out to be similar? Or compulsory schemes actually ended up paying more?
Do u have a choice? A choice of a party ready to be govt and also a better govt to implement a better scheme?
It is time we have a referendum on these two schemes.
I would reject both of them in exchange for higher taxes and free medical and social securities.
It is undeniable facts that rapid development of mobile internet had outmoded many things where done in the past?
News and info can even be search in seconds even by children?
Facts and figures can be compare and verified around the world in seconds?
The invention of mobile phone make it first appearance in Singapore in 1991 of Motorola, bulky and expensive?
Then came Nokia made it much smaller, cheaper and much more features?
Soon Apple introduce the mobile internet smart phone, which outmoded Nokia phones?
And samsung came along to make it cheaper for the mass?
As price continue to drop, new invention make it easier to use, what will be the next big thing?
Soon even older and less educated people use mobile internet, as it flood and saturate the market like mobile phone, which outmode coinafone?
The world of communication and sharing of info changed rapidly, which previously most of them got their info from MSM?
Could mobile internet outmode the MSM sooner rather later?
PAP can afford to implement any scheme which is best for PAP/Sinkieland, for foreigners, and then for Sinkies, in that order.
If by coincidence, the scheme is best for PAP and also Sinkies, then good lah, for Sinkies.
If not, just too bad lah, Sinkies will have to make the sacrifices.
"It is time we have a referendum on these two schemes."
Anon 8:59 am
A referendum can only be called by the party in power, that is the Govt.
So win the election and be the elected govt first, before talking about referendum.
The shocker will come when the "affordable" premiums are announced. Somehow the "PAP" stamp is missing if it does not make money
redbean
Anything from the PAP gahmen sure good one.
But just to be sure.
I will double confirm by voting in more Opposition.
PAP already in power for 50 years.
Getting a bit fat and lazy.
Must spur them on to work harder.
Tomorrow just be sure to be at Hong Lim to vote on your feet for your children and grandchildren, also for yourself.
@RB:
>> he people can now live in peace, sleep in peace because of these two great schemes.
They are not "great" lah. They are "adequate". They are there to help. If you think you can rely on them solely, then you are either lying to yourself, a bloody fool...or both.
Govt insurance schemes are by nature inefficient. The private sector does a better job because of many things, but mainly because of the profit motive. The prospect of making or losing money -- real money, not infinite govt money from tax -- motivate people in the private sector to moderate their behaviour and thinking accordingly.
In the private sector if you fuck up, you lose your job or go to jail. Your firm might even collapse.
In the govt sector, you fuck up worse that can happen is you get transferred. The stat board you've caused financial harm to just goes on with "business as usual".
Got private insurance?
Ya, ya, must privatise to be efficient. This is Singapore's mantra.
@RB:
>> This is Singapore's mantra.
"Mantras" are for true believers who take things on faith -- i.e. acceptance without fact.
Privatising entities to do financial stuff and mitigate risk (aka insurance) is best left to the private sector. This is FACT backed up by studies and hard evidence.
Privatisation benefits those who are productive and contribute to the commonweal. The losers, well they get royally FUCKED, which is what they deserve.
Meritocracy: you get what you deserve.
Matilah is saying sinkies are in good hands as long as the government is incharge.
How come Hainan Ah Ko not a speaker at Hong Lim on 7 Jun 2014 hah, unlike in the past?
Maybe after forming party, he has become wiser like Teochew Ah Hia?
And Ah Hia never even step foot in Hong Lim park at all, at least not publicly, u know.
Maybe that's how he became the leader of the strongest opposition party. And Ah Ko is learning from him.
Since healthcare so expensive, why not just outsource non critical ones to the neighbouring countries. Even oz is cheaper than sg.
Don't worry too much Singaporeans. You are in capable hands. Everything will be OK. I think you worry too much.
Hong Lim on Saturday will be peaceful and calm. People will speak about your CPF and nothing will change. Live with it. If you think you cannot tahan, then pack up and leave. No one is stopping you. Take you CPF and go. Simple as that.
Matilar, u die die must sprout your nonsense everyday despite earlier post by some one to ask u not to waste time and focus on your books wrting. Knn can write book 6 and 9 or not?
I think only that books poster can get to matilar reading his response to him. U can detect that he lost his cool. If he ever write his books, I hope it's book 1 the classic
There have been many protests on several national issues organised by various entities and individuals in the past years. By far, the most attended protest on national issues was the Feb 2013 PWP HLP protest. Based on many reliable estimates, the number of people who attended the event exceeded 5,000. Arguably the PWP controversy cut through the entire cross-section of the population and found significant spontaneous response from people of all walks both young and old. The upcoming CPF HLP protest seems equally broad based in terms of impact on the people concerned. Potentially, any citizen is affected and not just the working adults but students and retirees alike. How would the likely turnout at this upcoming CPF HLP protest be and what would be its significance?
The most probable scenario is a potential turnout of 5,000 to 10,000 people and likely to reach the upper limit. CPF is a close to the heart issue to many Singaporeans especially those retirees and those in their forties, fifties and sixties. With the CPF minimum sum been raised to S$155,000 this coming July which is less than 30 days away and not forgetting the medisave account minimum sum mandated at more than S$40,000 at current rate, the total amount is easily in excess of S$200,000 for Singaporeans reaching 55 years of age and will be "locked up" till 65 before pittance of few hundred dollars release bit by bit to the CPF holders when living cost is going through the roof.
Typically, an undergraduate student's living expenses already exceeded a few hundred dollars a month excluding university fees, exam fees, lodging, books, utilities fees, home meals and annual holiday breaks and seasonal festival expenses. For retirees to subsist on a few hundred dollars a month what rightfully was their life time hard earned savings and doled out at drips and pieces is certainly not a golden retirement prospect many people who have slogged a life time in a pressure cooker society look forward to. Despite the statistics, not many people can live till a ripe old age of 80+ or 90+ years old. Not being able to access their retirement funds even at age 65 and only given bits and pieces here that can barely defray living expenses not mentioning medical fees is something that is found wanting by people generally.
Even in much lower living standard nations in Asia such as China, anecdotal evidence showed that their retirees are provided with much, much better retirement benefits and monthly allowance in recent years. How the Singapore authority intends to address and tackle this issue satisfactorily, reasonably and fairly in the eyes of the people remains to be seen.
Some people brought out that the weather might deter the eventual turnout. Alas, for such "critical issues", not mentioning raindrops that essentially can be easily resolved using a good raincoat or umbrella, even if it was to "rain knives", a good "metallic flexible umbrella" would provide sufficient shelter relative to the issue on hand. For such "life and death" issue, small inconveniences such as rain is unlikely to deter people's turnout. A good anecdotal example is the countless past election rallies. People were totally drenched, shoes muddied yet turnout numbered as many as 50,000 to in excess of 100,000. Thus, it is possible that the upcoming turnout can be massive.
The possibility and probability of 300 to 500 hundred people turnout is likely to be as unlikely as a person living to 200 years old. Barring any unforeseen natural or man made calamity such as earthquake, inaccessible traffic that deter people from reaching the legally sanctioned protest venue and event by the authority, such scenario is highly unlikely and the probability of it happening might be close to striking 4D lottery.
The next possible scenario is a turnout of 500 to 5,000 people. Given the extent that this CPF issue affects the people universally, it is highly unusual if it happens that people would not even bother to turn up and show face. This is not a political event per se but one that affects people's future livelihood and retirement, healthcare expenses etc. If people bother to get up to work or school since young for the past 60 years from 3 years old to 65 when they retire, why should they not go for an event 4pm in the afternoon on a Saturday which affects many decades of life savings and future retirement livelihood and medical needs?
Lastly, a potential crowd exceeding 10,000. This is possible but given the tiny size of a protest site, the crowd would be spilling to nearby sidewalks etc. If it happens, people will be clamouring for a much larger protest site in the future such as the padang or national stadium or even the entire orchard rd for an adequate venue in the future.
The final verdict shall be known soon by evening 7 Jun 2014. Regardless of the turnout, this CPF issue is unlikely to die down any time soon and might turn "messy" in the future if no satisfactory answer is given to the people when the "means and money" is still there. Anyway, according to recent official stand, the CPF money is acknowledged as the "people's own money anyway". It is a matter of how it is going to be returned to the people upon retirement, when and how much? Imagine when one put in a deposit into a bank for 40 years looking forward to a deserved retirement after a life time of hard work and the money is attached with all kinds of restrictions and conditions for withdrawals and continuously changing with moving goal posts? Who on earth with rational mind would accept such outcome?
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