While I agree with Mr K. Kalidas that insurers should seek government approval before adjusting premiums and that comparative data should be provided, I disagree that MediShield Life should be outsourced to private insurers ("Private insurers can manage MediShield Life - with safeguards"; Tuesday).
First, premiums may rise because of claims history and not just because of the profit motive. Hence, an insurer will still be able to justify any premium increase to the Government.
Having only the Government run MediShield Life will ensure lower premiums because of the pooling effect.
Second, an insurer may try to justify raising premiums by adding extra coverage that has little or no benefit to policyholders.
With the Government managing the scheme, all benefits will be standardised.
Third, it could be difficult for one to switch insurers, even with comparative data provided by the Government.
This could be because of the policyholder's age, prevailing medical conditions or claims history.
Hence, I urge the Government not to outsource MediShield Life to private insurers.
Leong Kok Seng
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