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The facts about health insurance
What if the unexpected were to happen to you? One day you’re fine. Next day you’re flat your back in a hospital bed. Even a short stay in the hospital can inflict a mortal blow to your bank balance. But not if you have health insurance cover. As most people are still somewhat in the dark about health insurance, here are answers to some of the most frequently asked questions. Remember that it’s better to arm yourself with knowledge, and to always prepare for the unexpected. It will save you a lot of heartache, not to mention hard cash.
Who needs health insurance? Why?
Everybody needs health insurance coverage. It does not matter if you are young or old, in perfect health or otherwise. In fact, the best time to buy health insurance is when you are young and healthy. Many health insurance policies stipulate a maximum entry age for acceptance of an application for coverage. You may not be able to buy certain types of health insurance if you are past a certain age. And if you have a history of health problems, you may have to pay a lot more. Generally, healthcare costs move in one direction – up. A financially-prudent person will want to ensure that he or she has adequate insurance protection to meet unexpected, financially-crippling hospital or medical bills.
What kind of coverage can I get from my health insurance?
Health insurance covers your hospitalisation expenses including room and board, medical consultation, operation theatre and surgical fees. Most health insurance plans also provide pre- and post-hospitalisation benefits. There are also plans that provide lump sum payment upon diagnosis of certain critical illnesses. These plans are usually known as critical illness or dread disease coverage.
What if I am hospitalized overseas? Would my health insurance plan cover me?
Most health insurance plans provide worldwide coverage. However, the amount that you can claim would normally be subject to the customary and reasonable charges applicable in Singapore.
Is there any limit to the amount of benefits paid over a given period of time?
Yes, there are annual as well as lifetime limits to the maximum amount of benefits that can be paid.
If I have health insurance, does it mean I don’t have to pay a single cent if I am hospitalised?
No. Most health insurance plans come with a deductible and co-insurance.
The deductible is the claim amount below which no benefit would be payable from the insurance plan. It is to deter small claims thus enabling the insurance company to charge you lower premiums for the plan.
Any claim amount in excess of the deductible would be shared between the insurance company and you in an arrangement known as co-insurance.
For example, suppose the health insurance plan has a deductible of $500 and a co-insurance of 20%. In the event of a claim for $10,000, the insurance plan would reimburse 80% of the claim amount in excess of the deductible, i.e. 80% of $9,500 or $7,600. You would have to fork out $2,400 from your own pocket.
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