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Health insurance: how to handle the transition between an expat contract to a local contract?

22 Mar 2018

From the expat “package” to a local contract, how to make sure you maintain an appropriate health insurance? And for what price?

In 2017, more than 80% of foreigners living in Singapore were under a local contract. The expats of the 90s are becoming a rare sight! Which one are we talking about you may ask. The one with an “all inclusive” contract. His company bore the cost of his housing, children’s education, health insurance. Sometimes, it also includes a membership to a private club.  etc…

1) The changes amongst the expat profile

The “all inclusive” type of contract is less and less common in Singapore. Two key points have changed in the past years. First of all, for local or multinational companies, foreigners are no more a necessity to fill high responsibility jobs. Furthermore, the average age of expats is dropping. Nowadays, professional reasons are no longer the cause of expatriation but it is linked to “life experience”. The expats are looking for a total immersion in the Singaporean way of life with no specific time limit. Their return flight home is still not settled and it is common to see these expat stay longer than expected.

2) The Margaret example

In order to fully understand the stacks of expatriation, let’s take the example of Margaret. Originally for Belgium, she has been living in Singapore for the past two years. As Chief Customer Officer for a large industrial corporation, she left her home country with a beneficial expat “package”. For the first two years of her contract, she benefited from compensations to help her settle in Singapore. They included a full payment of her housing expenses and an international health insurance. A very interesting package for someone who wanted to try the expat experience. Singapore being a very attractive destination, is ranked as one of the most preferred destinations by expats. Margaret’s mind was quickly made to move to the Little Red Dot.

However, like in many cases, after two years of this contract, her company did not wish to renew her package. They offered her the opportunity to stay but with a local contract. This means that the rent is no longer bore by her company and in Singapore, rent can be extremely costly. For example, an apartment in the center of Singapore with one room would cost approximately S$ 3000.

The “Business Insider” Magazine has ranked Singapore as the 5th most expensive city worldwide in terms of rent.

Her international health insurance was also no longer paid for by her company. She never asked herself about her healthcare or their costs before. Private or public hospitals, from Mount Elizabeth to Singapore General Hospital, Margaret had a large range of choices. Today, the issue is to understand the healthcare system in Singapore and find a way to maintain a proper health insurance.

3) Our advice

If you are in the same situation as Margaret, here our a few of our advices to solve the health insurance issue:

A) Use the current recruitment market situation to convince your employer. As a matter of fact, health insurance can be a weapon of mass recruitment for the employers. They use it as as an argument to convince foreigners to join their company rather than another.

B) Negotiate the integration of your health insurance fees in you new salary. An international health insurance at UEX, for a 35 year old client, costs 4 927 SGD per year. It is way easier to negotiate with your employer than your rent! From your point of view, it’s a cost that you don’t have to take into account yourself. For your employer’s point of view, it’s affordable.

C) If you had planned to stay in your company, try to stay in it’s group insurance plan. Even if you have to pay, partially or fully, this group insurance can be interesting. It can be quite beneficial as the price will always be lower than the one you could subscribe to by yourself. Furthermore, you won’t even have to fill in a health declaration, that could exclude any potential pre-existing conditions.

D) If you are still employed but looking for a new job, subscribe to a individual health insurance. In case you decide to resign, you would be able to keep your individual coverage. If you have opted for a maternity coverage with a waiting period, it is usually even more interesting that you don’t change. Find out more in our article about maternity coverages. You can always ask your new employer to bear the costs, partially or fully, of your health insurance.

E) Ask for a similar insurance as your fellow singaporean colleagues. The local employees have an account called Medisave. Your company provides money for this account which allows your colleagues to pay for their medical bills. In order to have a better understanding, you can take a look at our article explaining precisely what is Medisave. A foreign employee can not benefit from Medisave and is not covered by any type of social security. The employer should, in that case, bear the cost of his foreign employees health insurance. This should reach approximately the same amount he gives his local employees for Medisave. It equals to approximately 17% of the salary for an employee who is less than 50 years old.

You now have all the key knowledge to switch from a expat employment contract to a local one while maintaining a suitable health insurance.
To find out more about healthcare topics in Singapore you can check our
articles. To understand how your health insurance plans cover the healthcare costs, you can approach UEX’s happiness team by email or by phone for more information and guidance – and the good news is that they are super nice!

With UEX, you can obtain a quote for a health insurance contract customized to your needs and requirements – all in less than a minute!

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