Health Insurance is a hot topic for many foreigners in China as people look to protect themselves and spread the costs of hefty medical bills. International hospitals in China are now some of the most expensive in the world. Take this into account when family planning in Beijing.
Your need for insurance does not start when you have your first baby, it actually starts at least a year before.
Much can be written about this subject so in this blog I will focus on the key areas of family policies. The first point to note here is that your need for insurance does not start when you have your first baby, it actually starts at least a year before.
Maternity Cover
Most policies will enforce a waiting period before you will be covered for maternity related claims and this period is usually 12 months. Thus, the policy needs to be in place 12 months before you can claim for pre-natal packages, scans, delivery and so forth. Of course this pre-planning is not always possible but it will likely save you thousands of dollars if followed.
Most policies do not have an unlimited amount that you can claim in maternity expenses. There will be upper limit caps, most often between USD7,500 to USD20,000 per pregnancy.You should first decide on which hospital you intend to use for your pregnancy and research how much their packages cost. You can then choose a policy that will have an upper limit that will accommodate the hospital and package that you choose. Here in Beijing you will find that many of the full maternity packages at international hospitals are approaching the USD10,000 mark, and perhaps not coincidentally the most common upper limit on a policy is USD10,000. If you want to be covered for anything outside of a ‘normal pregnancy’ you may need a higher upper limit and thus an increase in your monthly premium.
When maternity cover is included the insurers are expecting you to use it, so the monthly premiums reflect this fact as the insurers look to protect themselves before a big claim is made. If you are cost focused, then a great way to substantially reduce your premiums is to remove ‘Luxury Providers’ from the policy. Many insurers will group the most expensive hospitals into this category, so if you are happy to use a more local style hospital then you may find your premiums will drop by up to 40%. If you do your research you will find that many of these local hospitals have a good standard of care and often have VIP departments that speak English.
Family Policies
If you are looking to insure more than one person on a policy then you need to consider whether a family policy is right for you. If you try to get an insurance quote with at least one parent and at least one child on the policy then usually you will be automatically given a family policy quote. This is a double edged sword as there are specific benefits on these polices such as new born cover and child related wellness benefits that most people want, but you may end up paying for benefits that you will never use.
I will give you two common scenarios that I regularly come across to highlight this issue. Firstly, there is the couple who are planning to have their first child. For those who are not on expat packages, this is often the first time they have decided to take out a family health insurance policy. It would seem logical to obtain a quote to cover both persons ensuring that maternity is included. The quote that you will receive will cover both persons to the same level and the premium will reflect this. The upshot of this is that the male on the policy is effectively covered for maternity as well, a benefit that would be very impressive if he was ever able to use. It may well be more beneficial and cost effective to have two separate polices with the woman having a more comprehensive cover to include maternity but for the man to have a separate policy focusing on inpatient and A & E cover.
The second common scenario is for two parents with one or more children to be insured. A similar consideration should be given as to whether the man really wants to be on the same policy as the rest of the family if you are looking to save money. The benefits that the children get on the policy are exactly the same regardless of whether there are one or two parents on the same policy. Maternity cover will usually come as standard as there are children on the policy, so it may well be cheaper to insure the mother and the children on one policy and the father on another separate policy.
I am regularly asked whether children can be insured on a policy on their own. Generally speaking, children under the age of 16 cannot be insured on their own as they do not have legal capacity to enter into the contract so at least one parent will also have to be on the policy.
Heath Insurance in China in 2016
The landscape for insuring expats in China is rapidly changing and unfortunately this is driving prices higher year on year. Many insurers now group China, Hong Kong and Singapore into a higher premium category than ever before as International hospitals start to reach near USA level prices.
I have noticed that some Insurance companies are starting to remove Direct Billing from top international hospitals in a bid to reduce regular claims, so make sure you check that your hospital of choice has direct billing set up with the insurer before taking out a policy. If not,you will be paying cash and filling out forms for each claim, which is not much fun.
As an overview there are three key factors to a health insurance policy: price, cover and will the insurer actually pay out. The price and cover are the two that most people focus on as they are easy to compare and contrast between different insurers and different policies. Whether the insurer will actually pay out is grossly overlooked and you should always remember that with insurance you usually get what you pay for as it is such a competitive market. If you see a policy that has the same benefits as ten other competitors but is 30 percent cheaper, then you need to really consider where they are making their savings.A common criticism that is leveled at the China domestic insurance market is that the prices are cheap but the insurers willingness to pay on claims is questionable.
Finally, you can take insurance out online or through a professional broker or financial adviser. The prices are always exactly the same whether you go direct to the insurance company or through a third party broker, as brokers and advisers are paid a flat commission from the insurance company.Always the best advice is to talk to an independent professional as they will be able to tailor the correct policy and insurer to suite your specific needs.
Photo: hubspot.net, Quinn Dombrowski (Flickr)
