What happens if you lie about your medical history when buying critical illnesses insurance in Singapore?

Reflected in an 85 per cent critical illness protection gap in Singapore, it is apparent that many Singaporeans overlook the importance of or are unaware of the benefits of critical illness insurance.

For those who are protected, it may sound tempting to hide your medical history from insurers to benefit from a better rate and higher coverage as you will be deemed as a lower risk candidate.

But, is it worth it?

What is critical illness insurance?

This may be the first time that you have heard of critical illness insurance. Put simply, it is an insurance plan that pays you a lump sum if you have been diagnosed with a critical illness covered by the policy.

Due to the fact that such illnesses are often expensive to treat and you might need to take time off from work, the lump sum received can help to ease the financial burden. Typically, the lump sum given by insurers starts from a few thousand dollars.

However, this depends greatly on a number of factors, including your gender, age, lifestyle, health condition as well as family medical history.

What constitutes a critical illness

Critical illnesses are ones that are life-threatening and illnesses that constitute critical illnesses vary across insurance companies. While the Life Insurance Association (LIA) of Singapore has published a list of the 37 industry-accepted critical illnesses, not all insurers will offer the same coverage for all 37 illnesses.

Late-stage cancer, heart attack, stroke, coronary bypass, and end-stage kidney failure are just a number of the common illnesses that insurers classify as critical illnesses and offer coverage for.

As such, before purchasing an insurance plan, it is imperative to check through the terms and conditions to ensure that you have the necessary coverage.

Critical illness insurance vs health insurance

A key differentiating factor between critical illnesses insurance and health insurance is their flexibility.

The lump sum given out from critical illness insurance can be used to fund any expense, not restricted to healthcare expenses. As such, you have the option to use it to cover your lost income or transport fares.

On the other hand, the money received from health insurance can only be used to fund your hospitalisation expenses only.

Find the best critical illness insurance in Singapore

At this juncture, you may be thinking of applying for a critical illness insurance plan. To simplify the process of finding the best critical illness insurance plan for you, our analysts have reviewed critical illness insurance plans across Singapore. Below are a few of our top picks!

FWD Big 3 critical illness insurance

Promo: Get 20 per cent off with the promo code VBIG20.

Consider this if you are looking for a plan covering the most common critical illnesses.

Covering the three most common critical illnesses — cancer, heart attack, and stroke — FWD’s Big 3 critical illness insurance is a standalone plan that is 66 per cent cheaper than the market average. With the option to choose three levels of coverage ranging from $50,000 to $200,000, FWD’s Big 3 critical illness insurance plan caters to almost every budget.

Great Eastern Great Family Care

If your budget permits, Great Eastern Great Family Care is a great option as well. A plan that covers you, your children, and your parents if you would like to, this is a plan suitable for families looking to get one critical illness policy for the whole family.

MSIG Cancer Insurance

Promo: 20 per cent discount on all CancerCare plus plans and a chance to win Dyson v12 and Apple Watch Series 7 with every successful application.

Consider this if you are looking for affordable cancer coverage for millennials.

Standing out as a plan catered to the younger buyers, MSIG Cancer Insurance is a competitively priced cancer insurance plan exclusively offering cancer coverage. Under this plan, you can receive up to $100,000 of coverage if you get diagnosed with late-stage cancer along with a 50 per cent early cancer accelerator benefit.

Lying on a critical illness insurance application

Knowing that the lump sum that you will receive as well as the coverage of your plan greatly depends on your health condition, you may be tempted to hide your medical information from insurers.

To obtain better rates, many often withhold information regarding their personal medical history, family medical history as well as tobacco use. By hiding such information, the insured may be deemed as a lower risk candidate and receive higher coverage and sum assured, which refers to the lump sum.

How insurers investigate insurance fraud in Singapore

To protect your personal information, medical records in Singapore are stored in the National Electronic Health Records and cannot be accessed by insurance companies unless necessary. While this may sound good, when you wish to make an insurance claim, insurance companies will be able to access your medical records.

Nevertheless, they are unable to directly access it. Instead, you will be required to ask for the Medical Report Office or doctor to fill in an insurance form on your behalf.

Furthermore, because the insurance industry is relatively small, there is a high chance that insurers may crosscheck with each other during the processing of your application and claim. As a result, there will be no way to hide your personal and family medical history.

Consequences of hiding your medical history

In the event that your insurer discovers that you gave them inaccurate information, the amount of benefit you received may be adjusted. In the worst-case scenario, your insurer may decide to void or cancel your policy.

If the lie has been deemed to be minor, for instance giving the wrong age or gender, your policy may not be voided. Instead, the amount of the benefit or premiums will be altered to reflect the benefit or premiums that should be given according to the correct age or gender.

For lies that are more severe, as part of the duty of utmost good faith under the Insurance Act in Singapore, the insurance company has the right to void an insurance policy should there be non-disclosure of material facts when the insurance contract was written.

As such, hiding your medical history may not benefit you at all.

Accidental errors in your critical illness insurance application

It is entirely possible that you misunderstand the terms used or forget to include key personal information when filling up the application. Should you find yourself in such a situation, let your insurer know immediately. Depending on the type of information and severity, your insurance policy may not be affected.

To prevent such a situation from occurring, be sure to check the definition of the phrases with your respective insurance companies before submitting your application. These can be found in the policy wording of each insurance plan.

Is it worth it to lie about your medical history?

While the consequences of lying about your medical history when buying critical illness insurance or any insurance plan may not seem severe, you risk the chance that insurers will void your policy and deem you as untrustworthy. Thus, no matter how tempting it may be to obtain better rates by hiding key medical information, ultimately, it is not worth it.

Regardless of how healthy you may be, it is impossible to predict when a critical illness will occur. To avoid being tied down by financial burdens caused by critical illnesses in the future, find the most suitable plan for yourself using our comprehensive review on the best critical illness insurance plans across Singapore!

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This article was first published in ValueChampion.