Private Medical Insurance

A Roadmap to Selecting the Right Package for You

By Andrew Morgan April 7, 2016

Mr. and Mrs. Smith* moved to Bangkok in February this year and wisely took out private medical insurance with NZI Healthcare almost immediately. Shortly after they arrived Mr. Smith was rushed to hospital and diagnosed with a severe heart condition and other complications. Within two months he had run up bills totaling THB4 million at one of Bangkok’s international hospitals; a nightmare scenario for any expat. Fortunately Mr. Smith’s policy covered all costs. This case serves as a reminder why none of us can afford to snooze when it comes to medical insurance.

But how can you be confident your provider will deliver when it counts most? How do you make an informed decision on a product that can be confusing and confounding but is always essential? Well, here’s our roadmap to guide you in choosing a health insurance provider, help avoid common pitfalls, and ensure you select the plan that’s right for you.

A sound provider for a sound policy

Having a reliable and sound provider underwriting your policy is key in ensuring local regulatory compliance, a solid service offering, and a policy that is backed with the necessary financial clout to deliver when it matters. How well established is the provider and how do they measure up to industry standards?

Typically, health insurance providers offset some of their risk by re-insuring to other (often stake-holding) providers and financial institutions. In Thailand, NZI-Safety Insurance partner with Aetna International to provide international healthcare insurance plans that are fully licensed in Thailand. NZI-Safety Insurance falls under the umbrella of industry giant Insurance Australia Group; Aetna is a Fortune 500 company and one of the world’s largest health insurers.

Plans that are licensed in Thailand by the OIC (Office of Insurance Commission) come with the added benefit of tax deductible premiums for corporate groups. Premiums can be offset against domestic tax liability; not an option for offshore policies.

International operations are a great indication of corporate vitality but how about local service? All quality providers will have a 24-hour emergency line but having a local office in your country of residence can be invaluable in liaising with local hospitals, providing real-time advice and the kind of personal service that justifies a hefty premium. 

Know your underwriting

To many this may sound like a rather arcane topic but it’s actually pretty simple to understand -- and it’s vital that you do. Most medical policies are underwritten on ‘moratorium’ terms. In a nutshell, this means that you will not be covered for any conditions you have experienced within a stipulated period of time (typically 2-3 years) prior to taking out the policy. Some policies will permanently exclude these ‘pre-existing conditions’ while others operate a ‘rolling’ moratorium and may agree to cover them after a given period of time completely free of symptoms or treatment has passed.

Those with ongoing pre-existing conditions may like to consider a provider that offers ‘Full Medical Underwriting’ (FMU). NZI Healthcareoffer the option for individuals to apply for FMU and if the application is successful will provide cover for some or all pre-existing conditions, typically with a surcharge to the premium to account for the additional risk assumed.

Don’t be afraid to ask questions about your underwriting and what is excluded from cover at policy outset. If you can’t get clear answers or feel that the terms and conditions are not transparent, move on. 

Benefits and limits: Get into details

Sounds like a no-brainer doesn’t it? Well, far too few people really drill-down into the limits and benefits of their plan to understand exactly what, and how much, cover they have. Start with the overall limit; how does it measure up to others available, is it a lifetime limit, per-condition or per-year? Look closely at the sub-limits. A $2 million plan limit is great but it’s not that relevant if the limit for a local ambulance is just THB2,000 or cover for chronic conditions is capped at a few thousand dollars. Is cancer wellcovered (a single session of chemotherapy can cost around THB150-250, 000 in Thailand)? Are there limits on cover for hospital accommodation?

Premiums: do you really get what you pay for?

We all know the old saying and it rings no less true for health insurance. Don’t just go for the cheapest option; there’s usually a reason it’s cheapest. In addition to benefits and limits, think about your policy and premiums as a long term prospect. Most quality providers will operate ‘community rated’ premiums. Risk is shared across the global pool of policy holders so individuals will not be penalized by premium hikes upon renewal if they’ve made claims.   

Conversely, some providers offer valuable no-claims discounts to soften the blow of increased costs. To our knowledge, NZI Healthcare provide the most attractive no-claims discounts in Thailand: 10% after 1 claims-free year, increasing by 5% each year to a maximum of 25%. Over the long-term this can represent significant savings by offsetting age or inflation-related premium increases.

Consider an Excess

If you’re not too bothered about the smaller expenses but want to ensure peace of mind that you’re covered for the big-ticket costs, you may like to consider taking a larger voluntary excess. An excess or deductible is the portion of medical costs that the policy holder agrees to cover themselves before claiming against their policy. In exchange they benefit from a discount to their premium.

NZI Healthcare provide voluntary excess options from THB3,400-340,000 (in addition to nil or standard THB1,800) with corresponding premium discounts of 5-40%. This is a particularly attractive prospect for over 60s who see high premiums due to age.

Flexibility for your needs

One size does not fit all when it comes to medical insurance. If you have a large family, it makes sense to go for an insurer with family-friendly pricing. NZI Healthcare charge an under-18s rate for the first child; whilethe second, third and fourth childrenare covered free of charge if included as dependents on an adult’s policy. Many families also like to go for a plan that provides some degree of ‘wellness’ benefit, such as routine health checks and childrens’ tests and vaccinations.

Those travelling regularly may like to augment their health policy with a travel insurance add-on, especially if they travel to the USA, while others may require comprehensive maternity cover. Likewise, corporate groups may like to tailor benefits to meet their employees’ specific needs. Under NZI Healthcare plans, corporate groups benefit from generous discounts, starting at 17%, and have the flexibility to add and remove benefitsas required.

Hopefully youare now better equipped to evaluate and select a private medical insurance provider and plan. The options are myriad but by focusing on these key check-points you should be able to ensure that you and your family are well protected, without the headaches that are all too often part of the selection process.        

*Name changed to protect confidentiality