health insurance cost/ recomendation

hi!

Im 29 years old and also my husband, we have a baby, 1 month age, we are trying to search for an insurance company for the 3 of us, could you please recomend us any of them and let me know estimated cost for in/outpatient services? I saw lot of people has international insurance, is not one only for HK?

Hi sabrinadesprats, lots of options out there… really depends what you’re looking for. I’ll try and explain the deal fairly simply.


The first thing you’re going to want to think about is where to go to get an insurance plan. There are generally 3 main options in this regard:


1) A provider/underwriter

Fairly simple, identify an insurance underwriter/provider and go directly to the company. So, for instance BUPA Hong Kong (http://www.bupa.com.hk/eng/individuals.aspx) or BUPA International (http://www.bupa-intl.com/) are both “providers” – they underwrite their own plans and manage those plans accordingly.


2) Intermediary


The second option you have is to go through an Intermediary. However, you need to know that there are actually two main types of intermediary, and they will work in slightly different ways.


A) Agents

An agent is an intermediary, (as are Brokers, whom are mentioned slightly further down), who will work with you to liaise with a provider. However, unlike a broker, an Agent will work for the insurance company (not for you) and will normally be contracted to a maximum of 3 different companies. The fact that Agents only work with a limited number of providers will limit your choices, and because they work for the insurance company they really only want to sell you a policy (without thinking about what is best for your needs over the long term). However, there is nothing wrong with using an Agent, and if you find one that you like and who works with a plan that you’re keen on obtaining then no worries – go for it.


B) Brokers

Brokers are intermediaries who work for you (and not the insurance providers) – which is a legal obligation in Hong Kong… A Broker is your legal representative and must work for what is in your interests and not the insurers’. Brokers would be companies like http://hk.ccw-global.com – but there are many more in Hong Kong and around the world (Cooper Claridge-Ware, Alliance Group, MediBroker, BrokerFish, AbaCare) so you’ve got tons of options.


The benefit of a Broker over an Agent (aside from the fact that the broker works for you, and not the providers) is mainly in the expanded options that brokers can provide in terms of your coverage – it is not unusual for a broker to work with plans from more than 20 + companies – ensuring that you aren’t constricted in your coverage choices. If you decide to use a broker (any broker) you should realize that you will not normally pay more for your premiums than if you had gone directly to the underwriter – and you get the benefit of having things like claims and administrative support when you need them, in addition to receiving unbiased advice on what plans are best for you.



Once you’ve decided where you want to look for your health insurance, you then need to start thinking about the type of plan you want to obtain. There are two major variants currently available in HK – Local health insurance or International Health Insurance.


1) Local Health Insurance


Local Health Insurance plans are really “Hong Kong Only” policies – they will typically only provide health insurance protection to you and your family inside Hong Kong’s borders. If you go overseas, you’ll probably have to buy Travel Health Insurance if you want medical protection outside of Hong Kong. Additionally, Local Plans tend to be “History” or “Experience” rated when it comes to calculating the cost of the policy.


This means that often a local health insurance plan will seem like extremely good value when you initially purchase the coverage – however, this is because you have no “history” under the plan. The truth of the matter is that when you actually make a claim your premium will increase dramatically as you have developed a history under the plan (you are a higher risk). You may not make a claim for many years, but when you do, be prepared for a drastic increase when you next renew the coverage.


Furthermore, Local policies often have age caps – an age after which you can no longer remain on the coverage. This is often between 65 – 75 years old, and will mean that once you hit the age cap on the plan, you will no longer be offered the option to renew – which could be a major concern.


Finally, Local Plans will often have much lower annual limits than their international counterparts, meaning that should you develop a serious medical condition (like cancer) that there is a very real worry that your policy will run out of coverage at some point (you will hit the limit).


2) International Health Insurance


International private medical insurance (IPMI) products, unlike their local counterparts, will normally provide protection on a worldwide basis – while there are “coverage areas” which you can select, you are usually allowed to receive protection under the policy no matter where you are in the world. You’re also usually free to choose where you want to receive your medical treatment (with any doctor or hospital in the world), making these policies much more flexible.


IPMI plan premiums are normally calculated on a community basis. Basically, you will pay the same premium as every other person of the same age, with the same coverage, in the same geographical area – the “risk” of the group is pooled. Your premium will only ever increase because of your age (as you get older) and medical inflation (as the cost of healthcare increases); under IPMI products you will almost never pay a higher premium because you have made a claim under the plan – claims will normally not impact your plan’s cost.


Moreover, IPMI products are typically guaranteed renewable for life – so as long as you wish to retain coverage you are able to do so – with extremely high annual limits (in the region of US$ 1.2 – 2 million per year), so you don’t have to worry about the coverage running out.



In terms of which product you should go with (international vs local) it really depends on what you think you’ll need. Are you an expatriate living in Hong Kong, and if so, do you think you’ll relocate to a new country or return to your home nation in the future? If you said yes, then it is important to realize that a local plan will most likely not travel with you.


Do you want to receive healthcare at a hospital like the Adventist, or are you happy to use the services at a hospital like the Queen Mary? If you’re happy to use the Queen Mary (and the public system) then the case could be made that you don’t actually need insurance at all – the costs associated with treatment at public hospitals are fairly inexpensive (around HK$ 100 per day). If you want to use the private system or if you are planning on having another child (at the Matilda, for instance) then you’re definitely going to need to think about private coverage.


Will you be covered by a company sponsored health insurance plan at some point in the future? If so, you may want to think about obtaining private coverage that has flexibility built in for that eventuality (like Allianz Worldwide Care’s new Dormancy Product).


Do you only want inpatient (hospital) and Outpatient protection? What about alternative therapies, emergency evacuation, dental, and maternity? You need to decide the scope of your coverage in order to get the best idea of what you need.


I’d recommend that you talk to some company in the insurance industry as a starting point. There are a number of new developments at the moment, especially with companies like AXA PPP launch products that aren’t exactly “international” but which have higher coverage levels and community ratings, so are a bit more comprehensive than “local” products.


Hope that helps! Please PM me if you have any more questions and I’ll try to point you in the right direction.