Insurance in Hong Kong, What You Need to Know
Insurance in Hong Kong is extremely similar to insurance in the USA. There are all the same types of insurance products; Motor, Home, Medical, Fire, Life, and Domestic Helper. Correctly identifying the coverage that you need is the most important first step when thinking about insurance. As such, the following is a brief out-line of some of the more common types of insurance products found in Hong Kong.
Everyone in Hong Kong needs Medical Insurance. As global medical costs are currently experiencing the highest levels of inflation ever recorded Health Insurance is increasingly becoming a hot-topic. Medical treatment is becoming more and more expensive across the globe, and nowhere is this more pronounced than in the USA and Hong Kong. According to insurance industry reports the USA is the most expensive place in the world to receive medical treatment, followed by Hong Kong and Israel. The issue has grown so bad that an inability to pay for healthcare is the number one cause of personal bankruptcy in the USA. A Medical Insurance policy will indemnify you against medical costs by contributing towards the cost of any medical treatment that you, the policyholder, receive.
One of the most important things to remember when considering any Hong Kong medical insurance plan is to remember that some of the coverage benefits, like maternity, will often be attached to a waiting period. This can often cause some difficulties when choosing a policy and not every insurance company applies the same waiting periods to their health insurance. With regards to maternity cover, there are typically two forms of waiting period that a plan can use, these are; from the start of the plan and until conception.
If you obtain a medical insurance policy which has a waiting period from the start of the plan (typically between 10 and 12 months) then you will only be able to claim for maternity related treatment, such as the actual delivery, that is received after you have been enrolled on the plan for that amount of time. Conversely, if you obtain a policy that requires you to wait a length of time until the conception (again, typically between 10 and 12 months) then you will have to wait until you have been on the policy for that length of time before you can conceive for the pregnancy to be covered.
A medical insurance policy with maternity coverage can offer a policyholder additional coverage benefits, including newborn child coverage. This is usually offered in one of two ways; your child can receive a free benefit or be born into the plan. If a newborn child is born into a plan then they will receive guaranteed coverage for life, no matter what the state of their health is at birth. It is important to note that this will increase the plan premium.
If the newborn receives a free benefit, then they will typically be covered up to a predetermined financial or time limit. After this limit has been reached, you must submit an application to the insurer for further coverage for the infant. While newborn coverage is attached to a waiting period, this can be much shorter than the waiting period for maternity protection. In some cases it is possible to obtain this type of protection having been on a plan for just 6 months.
It is important that any decision about an international health insurance plan is considered extremely carefully. One reason for this is that it is normally not possible to obtain coverage for pre-existing conditions, or medical conditions which where apparent prior to obtaining a medical insurance plan. Medical insurance will normally deal with pre-existing conditions in the following ways:
The insurance can exclude the condition from coverage. This means that the policy will not cover the cost of treatment or the treatment of any related conditions. Alternatively the insurance may offer coverage with a higher premium, known as a loading. This means that in some specific instances, you may be able to pay a higher premium in-order to obtain coverage on a pre-exiting condition. A third way that the insurance may deal with a pre-existing condition is by offering a waiting period. If, after a period of time (typically 24 months), the policyholder has not had a reoccurrence of the condition, nor received any treatment, then the condition may be considered for coverage at the policy renewal.
There are an array of benefits from which the policyholder can choose. Medical insurance can, and will, offer coverage for in-patient and out-patient treatment, dental, alternative medicines, complimentary therapies, emergency evacuation, and specialist consultations. Make sure you look at the options and get the plan that best meets your current and future needs. There are many choices, which can be confusing, but a quality medical insurance plan can help to give you peace-of-mind while living overseas.
Many people in Hong Kong have a car, and as such will need to know the options for motor vehicle coverage. There are two types of Motor Vehicle Insurance coverage that can be obtained; Third Party or Comprehensive.
Third Party – This is the minimum amount of coverage required by Hong Kong law. Under this type of policy you will be covered for third party injury and property damage. This means that in the event of an accident your insurance will provide protection of up to $ 100,000,000 for incidents resulting in injury, and up to $ 2,000,000 for property damage.
Comprehensive – As the name suggests, this form of motor insurance will offer a wider range of coverage. In addition to providing basic Third Party coverage, a Comprehensive policy will also provide cover for repairs to your vehicle after accident where you are at fault, as well as losses resulting from a fire or theft as well as a number of additional or extended benefits; which can include coverage for such things as roadside assistance.
Due to the higher coverage levels associated with a Comprehensive plan, this type of policy is more expensive. There are a number of factors that will affect the premium including; vehicle make and model, engine size, year of manufacture, the driver’s age, occupation, experience and, No Claims Discount.
No Claims Discount can lower your premium quite dramatically. No Claims Discount will give you a 20% reduction on your premium for your first claim free year on the policy, and a further 10% every year thereafter up to a maximum of 60%.
Home Contents Insurance and Fire Insurance are also extremely common throughout Hong Kong. However, these two types of cover are often confused even though they each offer different types of protection.
A Home Contents Insurance policy covers your possessions against theft and accidental damage inside your home. You may also take the option of insuring your belongings on a Worldwide All Risk basis. This essentially means that any items that you have elected to cover will be protected anywhere in the world. Jewelry and watches are some of the more typical items that policyholders will request coverage for. Home Contents Insurance premiums are typically calculated based on the total value of the items requiring coverage.
A Fire Insurance policy is designed to protect the physical structure of your home in the event that a fire occurs. Normally, it is possible to obtain a policy which will provide cover for Extended Perils such as water or typhoon damage, and subsidence. As a Fire Insurance policy will only cover the actual physical structure of a property this type of plan is usually only purchased by the individual who actually owns the residence. If you have a mortgage on a property then the bank will usually stipulate that you have Fire Insurance coverage. Fire Insurance premiums are calculated based on the total rebuilding costs of a property.
Domestic Helper insurance is another concern for many people. Under Hong Kong law it is required that all employers obtain Employee’s Compensation insurance coverage for employees. An employee’s compensation policy is designed to protect workers against accidents and injuries due to work, and under law must provide $ 100,000,000 in cover. If you have a helper it is mandatory that you purchase employees compensation.
Many Domestic Helper Insurance policies are extended to include medical insurance. While this coverage is not mandatory, it is often the case that many domestic helper employment contracts require that the employer cover the costs associated with any medical treatment. A Domestic Helper insurance policy which offers medical cover can have the double benefit of giving both you and your helper the security that should anything untoward happen, you both will have the protection that you need.
This is just a sample of the many, albeit the most common, types of insurance available in Hong Kong. There are a plethora of resources at hand to help potential policyholders reach informed decisions about the plans best suited for their needs. Shop around and see what is right for you, it is your choice.
Article Source: http://www.articlesbase.com/insurance-articles/insurance-in-hong-kong-what-you-need-to-know-4249940.html
Tags: car insurance, expat medical insurance, fire insurance, health insurance, international health insurance, life insurance