Health and Life Insurance Flashcards
Premium
People purchase a policy and pay a fee periodically. The amount of premium is based on the probability that you will make a claim.
It’s based on your life expectancy and the projections for the payouts for persons who die
Deductibles
The amount of money you have to pay before your insurance company will begin to pay on a claim
The higher the deductible, the lower the premium and vise versa
Where you can buy insurance in Hong Kong?
- appointed insurance agents (e.g.AIA, Prudential)
- authorized insurance brokers
- agents in banks (e.g.HSBC)
Are the insurance provider regulated in HK?
Only insurers and insurance intermediaries, i.e. insurance agents and insurance brokers, are regulated in Hong Kong.
The relevant legal framework for the regulation of insurers is provided by
the Insurance Companies Ordinance
Who is responsible for the regulation of the insurance industry?
The Commissioner of Insurance, in his role as the Insurance Authority
Outpatient expense insurance
covers doctors’ consultation and medication, specialist’s consultation and medication, Chinese doctors’ consultation and medication, alternative treatment
Hospital expense insurance
Hospital room and board and other charges.
Surgical expense insurance
Surgeon’s fee for an operation
Major medical expense insurance
Covers expenses for a serious injury or long- term illness. Has a deductible and coinsurance.
Coinsurance and copayment example
you have $20 copayment plus 20% coinsurance policy. you have a prescription for a generic drug costing $100. how much you and the insurance comp. need to pay?
you: $20 + ($100 - $20) * 20% = $36
insurance comp. : $100 - $36 = $64
Comprehensive major medical insurance
Low deductible offered without a separate, basic plan. Covers hospital, surgical, and other bills.
Critical illness policies
designed to alleviate your financial concerns should you find yourself facing life-threatening health problems. It’s no cure-all, but if you fall prey to a bout of very ill health, at least you’ll be able to focus your attention on getting well, rather than on making ends meet.
Critical illness insurance provides a lump-sum payment within 30 days of the time the policyholder receives a diagnosis. Such policies cover a host of diseases, including:
- stroke
- heart attack
- cancer
- paralysis
- the need for an organ transplant
- blindness
- disability
- a variety of lesser-known diseases (some policies cover more than 100 conditions)
Eligibility
Varies with age, marital status, and
dependency
Assigned benefits
Insurance pays your doctor or hospital directly
Benefit limits
Fixed amount per day for a hospital room
Copayment
Cost sharing in the form of a flat dollar amount you pay before the insurer will pay
Coinsurance
the percentage you must pay
Declaration Page
- Company name and address
- Your name and address
- Insurance policy number
- Description of property insured
- Effective dates
- Coverage types and limits
- Deductible
- Policy premium amount
Life insurance
insurance company promises to pay a lump sum (death benefits) to the designated beneficiary at the time of the policy holder’s death
Mortality tables
provide odds on your dying, based on your age and sex
Purpose of life insurance
-Protect someone who depends on you from financial loss related to your death.
It is to cover expenses when you die, and help those dependent on your income maintain their lifestyle.
-To leave as part of your estate.
-To pay off a mortgage or debts at the time of death.
-The amount of life insurance you need is based upon your liabilities and those dependent on your income
Whole life insurance
-Also called straight life
-Pay fixed premiums for a stipulated period, usually 20 or 30 years, or until you reach a specified age (65)
-Your policy then becomes “paid up” and you remain insured for life.
-Amount of premium depends on your age when you start the policy.
-Provides death benefits and accumulates a cash value.
-Minimum rate of return guaranteed
You can borrow against the cash value or draw it out at retirement.
Why purchase insurance?
cover you asset and protect you personal health
Insurance rider
an addendum to your primary coverage to cover sth. specific that is not covered on your primary policy
