Optimisation of Medical Insurance Rating Methodology for More Comprehensive Product Comparison | 10Life

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The medical insurance market is highly competitive, with features previously associated with mid-to-high-end medical insurance products becoming increasingly common. As mentioned in our earlier articles, there has been a growing trend of full coverage products under the Voluntary Health Insurance Scheme (VHIS) Flexible Plan.

In response to this shift, 10Life has updated the scoring methodology for medical insurance to encourage the industry to strive for excellence and enhance product coverage while aligning the scoring criteria more closely with user needs. The scoring factors include:

Medical Coverage Score – The product’s coverage rate for specified injury and illness cases
Resistance to Medical Inflation – Whether the product has features to counteract medical inflation

Raising the Coverage Threshold for Breast Cancer Cases

Let’s first discuss the Medical Coverage Score. This score is based on medical expenses for 12 injury and illness cases of varying severity (see table below). These cases involve different medical services, such as diagnostic scans, surgeon fees and operating theatre costs, prescription drugs, chemotherapy, medical devices, and post-discharge rehabilitation care, with expenses varying in amount. 10Life actuaries calculate the expected average coverage rate (Note 1) of a product based on the compensation limits for each case, allowing comparison of multiple medical insurance products in the market.

Additionally, we consulted the claims departments of several insurance companies for preliminary estimates of medical expenses for specified cases and cross-checked these estimates with multiple specialist doctors in Hong Kong. We also used publicly available data to ensure the reasonableness of these estimates, including reference fees for common surgeries listed on private hospital websites, reference charges for private medical services under the Hospital Authority, and claims data from the Hong Kong Federation of Insurers website (2015).

In this update, we have increased the assumed medical expenses for breast cancer cases, while assumptions for other cases remain unchanged. For the updated breast cancer case, in addition to the cost of mastectomy, we have included expenses for reconstructive surgery, chemotherapy, and radiotherapy. We then reassessed the coverage rate of relevant medical insurance products to identify those offering better protection. After all, breast cancer ranks among the top five most common cancers for women (Note 2) and cannot be overlooked.

Table: 12 Injury and Illness Cases of Varying Severity

Category of Injury/Illness	Injury/Illness Case and Treatment
Cancer	Breast Cancer: Mastectomy, Reconstruction, Chemotherapy, and Radiotherapy Lung Cancer: Lobectomy Liver Cancer: Surgery and Targeted Therapy Colorectal Cancer: Laparoscopic Colectomy and Chemotherapy
Injury	Anterior Cruciate Ligament Surgery Total Knee Replacement
Vascular Disease	Angioplasty with Stent Placement Stroke Daytime Haemodialysis
Non-Severe Illness	Fever Requiring Hospitalisation Haemorrhoidectomy Colonoscopy (Day Treatment)

The Importance of Resistance to Medical Inflation

Compared to medical insurance products with limits on individual coverage items, full coverage products may be easier to claim from, but they are still subject to annual policy limits and lifetime compensation caps. Medical inflation in Hong Kong is significant, with rates of 8.3% in 2019 and 8.1% in 2020 (see Note 3). Coupled with an ageing population, the likelihood of sustained increases in medical costs remains high.

Since most policyholders renew their medical insurance annually, this type of insurance is, to some extent, long-term in nature. Over time, medical inflation may unfortunately cause claim amounts to reach compensation limits, rendering coverage insufficient. Therefore, in addition to considering the expected coverage rate for specified injury and illness cases, 10Life also evaluates whether a product has the following three features to resist medical inflation:

Full Coverage (most items of the product have no sub-limits)
High Annual Policy Compensation Limit
- Standard Ward: Greater than or equal to $5,000,000
- Semi-Private Room: Greater than or equal to $8,000,000
- Private Room: Greater than or equal to $20,000,000
No Lifetime Limit or Guaranteed Non-Reduction of Coverage (applicable to all VHIS plans)

Less Than 10% of Products Achieve a 5-Star Rating

To help consumers easily identify high-quality products with better coverage, 10Life has introduced a 5-star rating system. This rating is based solely on product features and objective data, unaffected by commissions or referral fees from insurance companies. A product qualifies as 5-star if its Medical Coverage Score reaches 9.95 or above and it possesses features to resist medical inflation. Among numerous products, less than 10% achieve a 5-star rating. To compare 5-star rated products, you can use the 10Life Insurance Decoder:

Compare VHIS Plans (5-Star Rated Products)
Compare Standard Medical Insurance (5-Star Rated Products)
Compare High-End Medical Insurance (5-Star Rated Products)
Compare Global Medical Insurance (5-Star Rated Products)

Lastly, it must be noted that the scoring methodology involves assumptions and does not account for factors such as the underwriting process, strictness of claims assessment, or individual needs of policyholders. It is intended for general education and reference purposes only and does not constitute sales advice.

Notes:

10Life calculates the expected average coverage based on medical expenses for multiple common injury and illness cases of varying severity and involving different medical services under general circumstances. 10Life actuaries compare these expenses against the compensation limits of medical products to derive the expected average coverage, as detailed in the Scoring Methodology for Standard Medical Insurance. The expected coverage rate for the aforementioned cases is calculated based on estimated medical expenses under general circumstances and is used to "estimate" medical insurance coverage and the potential out-of-pocket expenses for consumers. This is for reference only and has not been confirmed by the relevant insurance companies. Users should not treat this as actual medical expenses. The severity of each case, required treatments, and the claims assessment by insurance companies may vary, all of which affect the actual compensation amount for policyholders. The actual compensation is subject to policy terms and conditions, with the final decision resting with the insurance company.
Data sourced from Hong Kong Cancer Statistics Overview 2019. Hospital Authority, Hong Kong; October 2021.
Figures sourced from Aon’s 2020 Global Medical Trend Rates.
The above information is provided by 10Life and is updated as of 9 December 2021.

This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.

Last updated: 9 Apr 2026

10Life Editorial Team

Our team of professional content researchers focussing on insurance

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10Life Editorial Team

Our team of professional content researchers focussing on insurance

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Optimised Medical Insurance Rating Methodology for More Comprehensive Product Comparison

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