Fewer than one in three Singaporeans have enough savings to cover household expenses during a prolonged recovery from a critical illness, even as most expect recovery from a severe-stage illness to last more than a year, according to a Prudential Singapore poll.
The survey found that 67% of respondents expect recovery from a severe-stage critical illness to take more than a year.
However, only 29% said their savings could cover household expenses for that period if they had no income while recovering.
The financial strain could be significant, with 64% estimating that they would need more than S$200,000 to manage the impact of a severe-stage critical illness.
Only 20% said they were confident they could cover both medical bills and everyday expenses during recovery.
Protection gap persists
The findings also point to a gap between critical illness insurance ownership and confidence in the level of protection available.
While 59% of respondents said they own a critical illness plan, only 20% were confident that their coverage was adequate to sustain them through recovery. Nearly nine in 10 respondents, or 88%, said a lump-sum critical illness payout would be important in helping their families manage caregiving expenses and income loss.
The findings are aligned with the Life Insurance Association's 2022 Protection Gap Study, which reported a 74% critical illness protection gap.
Manu Tandon, Chief Health & Protection Officer, Prudential Singapore said, "Many people recognise that recovery from a critical illness can take a long time, yet they may not be financially ready when it happens.
“Critical illness is not merely a medical episode. It can have far-reaching emotional, financial and physical implications for patients and their families, long after they leave the hospital. This may include the patient's loss of income, the strain of additional expenses, and greater demands on caregivers,” he added.
Savings take a hit
A prolonged recovery could force individuals to draw on savings and investments intended for other financial priorities.
More than half of respondents, or 53%, said they would use emergency funds if they ran out of money during recovery. Another 40% would turn to retirement savings, while 33% would sell investments.
Around 24% said they would return to work earlier than planned, highlighting the potential impact of a prolonged illness on both recovery and financial security.
Medical expenses emerged as the leading concern, cited by 46% of respondents. This was followed by loss of income at 34% and concerns about burdening family members at 31%.
For respondents with children, education costs could add to the financial pressure. Around 35% identified education fees as a key expense during recovery, while 24% said they would consider withdrawing their children from enrichment classes and 19% would dip into education funds.
Caregiving adds financial pressure
The financial impact of critical illness can also extend to family members who may have to leave work to provide care.
Although 72% of respondents identified financial support as the most important form of support for caregivers, only 13% believed their household would have enough savings if a caregiver stopped working.
Respondents identified drugs and alternative treatments as the most common potential caregiving expense, cited by 71%. This was followed by ongoing daily living expenses linked to care needs at 67% and rehabilitation and therapy at 59%.
Prudential Singapore refers to the period when an individual may be unable to work while recovering from a critical illness as "health gap years". These can arise following illnesses such as cancer, heart attack or stroke, when income may fall while household and caregiving expenses continue.
Tandon elaborated, "Ultimately, being prepared for potential health gap years can make a difference between a recovery journey overshadowed by financial stress and one focused on what matters most: recovery and getting life back on track. Building a strong financial safety net to weather a critical illness event is crucial not only for the individual, but the whole family."
Coverage needs regular review
The survey suggests that simply owning critical illness insurance may not translate into a sense of financial security.
"This indicates that consumer awareness and ownership of a CI plan do not necessarily translate into a sense of financial security. Closing the protection gap would require consumers to assess if their coverage is enough to support them and their families throughout the health gap years,” Tandon emphasised.
“Besides the sum assured, understanding the breadth of coverage and types of illnesses covered under your plan is important as there are different types of plans available. This is why it is important to do regular reviews with your financial representative to ensure your coverage continues to meet your needs through the years,” he concluded.
The poll surveyed 1,000 Singapore residents aged 18 to 55 and above between June and July 2026. The study examined financial preparedness, caregiving support and understanding of critical illness protection during potential "health gap years".