Large profit margin on Shield plan

One large insurance company collected $100 million on its private Shield plan and pays only $20 million in claims. It is making a huge profit margin.

If you pay $500 a year on a Shield policy to this company, you will get back about $100 in claim from this company. If the average claim payout is $100, a fair premium is $150 and not $500.

This company is able to make its Shield plan looks very attractive, but in reality the payout is poor. The consumers are not able to know about the reality until the time of making a claim.

You can buy another medical insurance plan that offers a higher claim to premium ratio, for example basic Medishield. You will pay a much lower premium. You can keep the rest of the premium in Medisave to earn 5% interest. You will need the savings for your future.