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Limited group medical insurance cover? Upgrade your protection comprehensively with a deductible medical insurance plan.
Many employees are grateful that their companies provide group medical insurance (commonly known as company medical insurance). When they have a cold or flu, they can visit a doctor at a low cost or even for free, and they can also claim for treatment at private hospitals. However, company medical insurance is usually insufficient. 10Life has surveyed a number of group medical insurance plans on the market and found that their coverage is determined by job grade. For most junior and middle-level employees earning a monthly salary of around HK$35,000 or less, the coverage is particularly limited. If employees are unfortunately hospitalised, they may have to pay a substantial amount of medical expenses themselves. In fact, working people may first familiarise themselves with their group medical insurance and then take out medical insurance with a deductible (also known as an excess). By making good use of both types of insurance, they can obtain comprehensive medical protection at a low premium.
Basic group medical insurance is limited to standard rooms, and the protection gap for serious illnesses should not be overlooked
Generally speaking, the typical group medical insurance provided by large companies in Hong Kong covers outpatient and hospitalisation expenses. Outpatient coverage is subject to annual, per-visit and visit-number limits, and covers general and specialist outpatient consultations. However, a valid referral letter is generally required to see a specialist. As for hospitalisation coverage, group medical insurance usually adopts an ‘itemised limits’ structure, with a claim limit for each covered item, such as room charges, surgical fees and miscellaneous expenses. In addition, basic-level group medical insurance usually restricts employees to standard rooms (also known as general wards), and its coverage is generally inferior to that of the standard plan under Voluntary Health Insurance Scheme. The following is an overview of the coverage provided by basic-level group medical insurance:
| Main covered items | Claim limit |
| Room and board | Approximately HK$650–$800 per day |
| Miscellaneous expenses | Approximately HK$10,000–$15,000 per year |
| Surgical fees | Approximately HK$10,000 per illness or injury (minor surgery) to HK$45,000 (complex surgery) |
| Outpatient | Approximately HK$4,000–$5,000 per year (subject to per-visit claim and visit-number limits) |
To understand the coverage provided by medical insurance, 10Life consulted several specialist doctors about the estimated medical expenses for a number of common illnesses and injuries, and the medical services involved. 10Life’s actuaries then compared these figures with the claim limits stated in the benefit schedules of various medical insurance products to calculate their estimated coverage ratios (see Note 1). For basic-level group medical insurance intended for junior and middle-level employees, the difference in coverage can be substantial depending on the severity of the illness. The estimated coverage ratios for several illness and injury cases (see Note 1), including serious and minor illnesses, are shown below. However, please note that the coverage limits of group medical insurance vary from company to company, which will affect the actual coverage ratio. Therefore, you should understand the sum insured under your own group medical insurance.
As shown in the chart above, group medical insurance provides reasonably adequate coverage for non-serious illnesses and injuries. For example, the estimated coverage ratio for a colonoscopy performed at a day clinic (commonly known as a ‘colonoscopy examination’) could reach 100%. For minor surgery, such as haemorrhoid removal, group medical insurance may cover approximately 90%, leaving the insured to pay around HK$4,700. Based on claims figures, these ‘minor illness’ cases are very common.
However, when an insured person suffers from a ‘serious illness’, the protection gap under group medical insurance becomes clear. For coronary angioplasty (commonly known as ‘unblocking the arteries’) with stent placement, the estimated coverage provided by group medical insurance is only around 30%, leaving the insured to pay approximately HK$150,000—a considerable expense. If the insured person develops cancer and requires surgery and targeted therapy, even if targeted drugs are covered by the group medical insurance, they may form only part of the miscellaneous expenses, meaning that the amount of expenses that can actually be offset is very limited. As a result, the estimated coverage provided by group medical insurance may be less than 20%, and the insured may have to pay nearly HK$400,000. For patients with severe kidney disease who require haemodialysis (also known as ‘blood washing’), the coverage provided by typical group medical insurance is even more inadequate, and the insured may have to pay more than HK$300,000 out of their own pocket.
Purchase medical insurance with a deductible to enhance medical protection at a low cost
As group medical insurance cannot provide comprehensive medical protection, many consumers plan ahead by taking out medical insurance themselves to bridge the gap in medical coverage. For customers with group medical insurance, insurance advisers will usually recommend a Top-up plan with a deductible or a high-end medical insurance plan. The deductible and premium are inversely related: the higher the deductible, the lower the premium.
Since the Government introduced the Voluntary Health Insurance Scheme, many consumers have specifically chosen medical insurance products recognised by the Food and Health Bureau, as their terms and conditions are clear and standardised, and policyholders may also be eligible for tax deductions. However, Voluntary Health Insurance Scheme products with deductibles on the market generally offer private or semi-private rooms. As for the more affordable standard-room option, as at the time of publication (15 May 2020), AXA WiseGuard Pro Medical Insurance Plan (標準) was the only plan on the market that was both a Voluntary Health Insurance Scheme product and offered a standard room as the room level, while also providing a deductible option.
In practice, consumers can decide whether to purchase medical insurance and select an appropriate deductible based on the coverage amount of their group medical insurance and their ability to pay, thereby reducing the premium. As mentioned above, the coverage ratio of basic-level group medical insurance is quite limited. Adding a standard-room plan with a deductible can significantly enhance protection, as illustrated by AXA WiseGuard Pro Medical Insurance Plan (標準).
The data above shows that, assuming the claim payments from group medical insurance are used to offset the deductible, pairing it with AXA WiseGuard Pro Medical Insurance Plan (標準) with a deductible of HK$20,000 or HK$50,000 can substantially increase the insured’s protection for coronary angioplasty and serious cancer requiring targeted drugs. With these two medical insurance plans, full reimbursement may be obtained. For haemodialysis, the insured’s estimated out-of-pocket medical expenses would fall significantly from HK$320,000 under group medical insurance alone to HK$16,000–$46,000 (see Note 1).
If you wish to make use of group medical insurance and medical insurance with a deductible to obtain better medical protection, please note the following:
Medical insurance claims are subject to a time limit, generally within 30 days of receiving treatment or being discharged from hospital. The insured must submit a claim form and other supporting documents. As you may be making claims from two different insurance companies, remember to allow sufficient time. To avoid any delays when making a claim, the insured can collect several claim forms and ask the attending doctor to complete them all at once, then submit them to the insurance companies together with the hospital receipts and relevant pathology reports. When making the first claim, remember to ask the insurance company to return certified copies of the documents, so that you can make a claim with the second insurance company as soon as possible. You may inform your insurance adviser (if applicable) before being admitted to hospital so that they can help follow up.
Group medical insurance is only provided to employees. If you leave your job, change jobs or retire in the future, you may lose your group medical insurance, at which point you may wish to reduce the deductible on your medical insurance. Some medical insurance plans allow the insured to change their deductible option without undergoing further underwriting, thereby avoiding the risk that a change in health condition later on could affect coverage if further underwriting were required. You should understand the relevant details clearly when taking out the policy.
This article discusses only a small number of Voluntary Health Insurance Scheme standard-room plans to illustrate how group medical insurance can be used together with individually purchased medical insurance. If you would like to learn more about Voluntary Health Insurance Scheme products, please visit the 10Life website’s ‘Product Decoder’ for an in-depth comparison.
Note:
- The estimated coverage ratios for the illnesses and injuries above are calculated based on the estimated medical expenses for the relevant illness or injury under सामान्य circumstances. They are intended to estimate the medical insurance claim amount and the consumer’s expected out-of-pocket expenses for reference only. Users should not regard them as the actual medical expenses. The severity of each illness or injury, the treatment required and the insurance company’s claims assessment may vary, all of which will affect the actual claim amount received by the insured. For details, please see ‘10Life’s Rating Methodology for Mass-Market Medical Insurance’.
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.
10Life Editorial Team
Our team of professional content researchers focussing on insurance
10Life Editorial Team
Our team of professional content researchers focussing on insurance
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10Life Product Comparison and 10Life Insurance Ratings are developed by 10Life Financial Limited, an authorised insurance broker company licensed with the Insurance Authority under License Number FB1526. 10Life Product Comparison and 10Life Insurance Ratings are developed for generic customer segments using mathematical calculations based on product information, facts and data, and are not influenced by any partnerships with or fees received from insurance companies. Any information on 10Life Platform ("10Life Information"), including but not limited to Product Comparison, Product Ratings, Blog Articles are intended for general education purpose and reference only. None of the 10Life Information is intended, nor should they be considered or relied upon, as regulated advice, insurance, financial, investment or professional advice, recommendation, approval, endorsement, invitation or solicitation in respect of any insurance, financial or investment products. 10Life Information does not take into account your individual needs. Reading 10Life Information should not be considered as conducting a suitability assessment, and is not sufficient to form the basis of any decisions to purchase any insurance products. You should rely on information authorised by insurance companies, carry out your own research and/or seek independent advice from licensed intermediaries before purchasing any insurance products or making any insurance decisions. While reasonable effort is used when collecting, validating and updating 10Life Information from various channels, none of 10Life Group and its subsidiaries, affiliates, agents, directors, officers and employees will be responsible for any liability, claim or loss arising from or associated with you using 10Life Information. No warranty, representation or guarantee is given by 10Life Group and its subsidiaries on the accuracy, completeness and timeliness of the information. If you have any questions on 10Life Product Comparison and 10Life Insurance Ratings, please email us at enquiries@10life.com
