PCE - Part A(2) Medical and Health Insurance
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Transcript of PCE - Part A(2) Medical and Health Insurance
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PCE - Part A(2) Medical and Health
Insurance
• Revision 01 (25/11/2011)
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MEDICAL HEALTH
INSURANCE
“Introduction”
CHAPTER 9
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Product Disclosure & Transparency in the Sale of MHI Policies
Objectives:• Protect policy owners’ interest• Facilitate consistency in disclosure of
essential information of MHI business• Minimise the chances of
mis-selling
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Why MHI
Ease the financial burden caused by adverse changes in health
MHI- one way people can reasonably afford to pay for the cost of such treatment
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Principles Applicable to MHI
Insurable Interest
Utmost Good Faith
Proximate cause
Indemnity
Contribution
Subrogation
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2 Categories of MHI
Indemnity policies
- E.g. Hospitalization and Surgical Insurance
Benefit Policies
- E.g. Critical illness and Disability income Insurance
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Standards of MHI
MHI policies limits• Per disability limit• Overall annual limit• Lifetime limit
Claim payment does not terminate coverage except
in the event of a death claim MHI risk increases with time
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‘Cashless’ Hospital Admission • Panel Hospitals
Cost Containment Measures
1. Inner limits
2. Schedule of Surgical Procedures
3. Maximum period of compensation
4. Timeframe during which expenses are paid
5. Co-payment for Upgraded rooms
6. Deductibles
7. Panel of hospitals
Standards of MHI
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MEDICAL HEALTH
INSURANCE
“Types of MHI”
CHAPTER 10
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Types of Medical & Health Insurance
Individual vs. Group policies
MHI policies comprise of:• Medical Expenses Insurance
a) Hospitalization and Surgical Insurance &/or
b) Major Medical Expenses Insurance • Hospitalization Cash Benefit Insurance• Critical Illness Insurance• Disability Income Insurance
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Medical Expense Insurance
Coverage:
I. Clinical Insurance (primary care)
II. Dental Insurance
III. Maternity Insurance
Payment:
Pay for treatment cost of a disability as stipulated in the policy
Limitation:
May impose some form of deductible or co-sharing
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Two Common Expense Participation Methods
Deductibles• A fixed amount• A percentage • A combination of percentage & fixed
amount
Co-payments
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Hospitalization & Surgical Insurance
Coverage:
- Hospital Room & Board- Intensive Care Unit- Hospital Supplies & Services- Surgeon’s Fees- Operating Theatre Fees
Payment:
- Treatment costs when treated as an in-patient (hospitalization) or surgically treated
Note: Additional benefits can be referred in Pg. 12
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Major Medical Expenses Insurance
Coverage:
Broad and substantial protection from large and unpredictable healthcare expenses. May take the following forms:
1. Supplemental Major Medical Insurance
2. Comprehensive Major Medical Insurance
3. Excess Major Medical Insurance
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Hospitalization Cash Benefit Insurance
Coverage:
Stand-alone policy / a rider to life insurance / medical & health insurance
Payment:
Pays the daily amount stated in contract for each day insured is hospitalized
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Critical Illness Insurance
Coverage:
Dread Disease insurance
Stand-alone or as a rider to a life policy
Payment:
Lump sum payment upon diagnosis of a covered illness specified in contract
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Disability Income Insurance
Coverage:
Known as Permanent Health Insurance
Commonly sold as a rider attached to a basic life
Insurance.
Payment:
Provide periodic payments when insured is unable
to work.
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Individual Policies• Name of the licensed insurer• Relationship with the licensed insurer• Premium charged by the licensed insurer
Group Policies• Name of the licensed insurer• Relationship with the licensed insurer• Conditions of the group policy &
remuneration payable to him• Premium charged by the licensed insurer
Section 186 of the Insurance Act 1996
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MEDICAL HEALTH
INSURANCE
“Underwriting MHI”
CHAPTER 11
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Purpose of Underwriting
Process of assessment & selection of risks,determination
of premium, terms & conditions.
The purpose of Underwriting aids in the following
situations: Anti-Selection Adequacy of Premium Risk Selection Process Medical Underwriting Financial Factors Occupational Factors (Class 1,2,3 & 4) Age & Sex Sources of Underwriting Information
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Sources of Underwriting Information
Application form
Agent’s statement
Medical / Paramedical Exams
Attending Physician Statements (APS)
Hospital Medical records
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Underwriting Decisions
Standard (issued exactly as applied for)
Sub-standard / Modified (issued on other-than-applied-for-basis)
Declined
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Underwriting Decisions
Issuing Modified Coverage
Exclusion Endorsements Extra Premiums (Loading) Change of Benefits (Modified Benefits) Renewal provision of Medical & Health
Insurance
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Renewal Provision of Medical & Health Insurance
Optional Renewable PoliciesOptional Renewable Policies
Non-cancelable PoliciesNon-cancelable Policies
Conditional RenewalConditional Renewal
Guaranteed Renewable PoliciesGuaranteed Renewable Policies
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Miscellaneous
Payment of Premium
- “Cash-before-cover”- 60 days premium warranty
Termination of a policy
- Death of an insured- Policy Anniversary immediately following the
insured’s maximum eligibility age- Total benefits paid under Policy since last
Policy Anniversary exceeds the maximum limit specified in the benefits schedule for the respective Policy Year.
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Miscellaneous
Free-look period / Cooling-off period
- 15 Days Cancellation of MHI policy
“during and after” free-look period
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MEDICAL HEALTH
INSURANCE
“Policy Administration”
CHAPTER 12
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Overview of Policy Administration
“Exchanges & issuance of documents to evidence the existence of a valid contract of insurance”
Documents include:
Proposal form Policy Endorsement Renewal Notice Proof of medical & health insurance premium
payment for tax relief
Regulated by Section 149 of the Insurance Act 1996
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Contents of a Proposal Form
Questions of a general nature
a) Proposer’s Name
b) Proposer’s Address
c) Risk Address
d) Proposer’s Occupation
Previous and Present Insurance
Specific Questions relating to Medical and Health Insurance
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Structure of a MHI Policy Form
Heading
The Preamble / Recital Clause
The Operative or Insurance Clause
Exclusions
The Schedule of Benefits
Attestation or Signature Clause
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Structure of a MHI Policy Form
Conditions
- Expressed- Implied
Conditions Subsequent to ContractConditions Precedent to Liability
Policy Register
Renewal Notices
Documents for Tax Relief
- RM3,000-00 (Education & Medical)
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Endorsement
Practice of insurers to issue policies in a standard form
covering certain specific perils and excluding others.
Should modifications be intended to the terms and
conditions at time of issuance of policy, one or more
memorandums or endorsements to the policy is attached
as evidence of contract.
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MEDICAL HEALTH
INSURANCE
“MHI Claims”
CHAPTER 13
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Notification of Loss
Between 14 days to 30 days
Furnish all supporting documents to substantiate the
claim Original hospitalization bill Claims form
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Conditions for a Valid Claim
Is the policy in force?
Has premium been paid?
Is the loss caused by an insured peril?
Is the subject matter affected by the loss the same as that insured under the policy?
Has notice of loss been given without undue delay?
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Structure of a MHI Claim Forms
Investigation of a claim
Settlement of MHI claims
Repudiation of liability by insurers
Disputes
1) Liability of Insurer?2) Quantum of loss, if insurer is liable? Negotiation & Compromise Settlement Litigation Arbitration Mediation
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