International or Local Health Insurance in Hong Kong?

When it comes to purchasing health insurance in Hong Kong it is important to realize that you have an exceptional range of choice when it comes to the policy you opt to buy. From the benefits you are receiving under the policy, to the insurer underwriting the coverage, there are a tremendous number of options to consider and decide on before you can take out a policy.

However, one of the more fundamental choices, that is going to impact the utility of your health insurance coverage, is determining whether you need an International Health Insurance policy or a Hong Kong Health Insurance policy.

On the surface, these two types of coverage will do much the same thing – reimburse you against the costs of your medical expenses. But the ways in which local and international health insurance operate could not be more distinct from each other.

What are Local and International Health Insurance Options?

When we talk about “Hong Kong Health Insurance” and “International Health Insurance” we are talking about the two distinct types of medical insurance which are available in HKSAR.

Hong Kong Health Insurance plans will normally be underwritten by Hong Kong Insurance Companies, and will be designed to provide coverage against the costs of medical treatment only within the confines of the city. In contrast to this International Health Insurance plans are typically underwritten by International Insurance Companies and are able to cover the policyholder against the costs of healthcare anywhere in the world.

While both types of plan have the same end objective – to provide support for the cost of healthcare services – the ways in which they do this are, fundamentally, different. To see this contrast, the first area to investigate is how premiums are calculated under both International and Hong Kong medical insurance products.

Health Insurance Premiums and Your Plan

One of the easiest ways to spot the difference between International Medical Insurance and Hong Kong Medical Insurance products is by looking at how premiums are calculated.

”Experience” Premium Ratings

Most local health insurance plans, ones operated and underwritten by Hong Kong insurance companies, will calculate premiums on an “experience” basis. This means your medical history will be directly factored into the cost of your coverage.

If you have no medical history, or pre-existing medical conditions, this makes many Hong Kong health insurance products an attractive proposition for consumers; they are, generally, extremely affordable when initially purchased. However, the major drawback here is that making any claims on the policy will directly impact the premium you can expect to pay when you renew the plan to keep the coverage going.

The increase will normally be proportional to the amount of care you have claimed, but can be extreme in serious healthcare cases.

"Community” Premium Ratings

The majority of International Health Insurance plans use Community rated premiums. This means that your individual claims will not impact your costs of continuing coverage.

When initially purchasing an International Health Insurance plan, various factors are taken into consideration including your age, the policy you have purchased, and your insurance’s coverage area. These variables are then used to create a “community” and the premium you will pay for your policy is the average expected cost of medical treatment for each community member over the coming year.

While the whole community will likely claim for treatment, your individual claims are not factored into your premium. This means that International Health Insurance products are generally more expensive than their local counterparts at the time of purchase, but increase at a more manageable rate over a long term period as the only factors impacting a cost hike will be your age, and the rate of medical inflation.

Coverage Areas under Health Insurance

A second major area of difference between local and international health insurance plans can be found in their Geographical areas of coverage.

For most Hong Kong medical insurance products, as previously mentioned, the coverage will not operate beyond the city’s borders. Should you hold health insurance coverage with a Hong Kong medical insurance policy then you will need to take out supplemental protection in the event that you go overseas (likely in the form of a travel insurance policy).

However, in contrast to this, most International Health Insurance plans will normally allow you to choose exactly where in the world you will receive coverage under the policy. Choices generally include, Worldwide, Worldwide Excluding the USA, Region-Specific Coverage (including Asia), or a specific country. This gives you, as the policyholder, more control over your plan and enables you to more effectively manage your cost of coverage by restricting the locations in which you receive protection.

For example, choosing an International Health Insurance policy with Worldwide protection will be much more expensive than choosing one which excludes the USA. This is for the simple fact that the USA has the most expensive private healthcare market in the world, followed closely by Hong Kong in second place. So, while an international health insurance policy gives you the option of receiving protection anywhere on earth, you also are empowered to tailor your plan so it works for your specific needs and budget.

Renewing Your Health Insurance

The last place in which it is very easy to see the differences between Local and International Health Insurance products is in how they will manage policy renewals.

For many Hong Kong health insurance products, the length of time you are able to remain on the plan is generally capped. Once you reach a certain age (normally 65 to 70 years old) it is no longer possible to renew your coverage or continue on your health insurance policy. On the other hand, International Health Insurance products normally have no limit for the duration of time you are able to remain on the policy and retain your coverage. As long as you continue to pay your annual premium, you will be insured under your policy.

This is important, and should be considered by all potential policyholders, as your likelihood of becoming seriously ill and requiring extensive medical treatment increases as you age. With Hong Kong Health Insurance products it is often a case that you will reach the end of your coverage at the time when you need insurance support the most; and while Hong Kong does have an exceptional public healthcare system, being unable to rely on a policy you may have held for an extended period of time is going to add to the overall situational stress.

Your Health Insurance Options in Hong Kong

There are no “one-size-fits-all” solutions for health insurance. At the end of the day, you will have to determine your needs, and the needs of your loved ones, and select a policy that is right for those. From your lifestyle, to any pre-existing medical concerns, there are a host of factors that come into play, and a incredible number of options for you to sort through.

CCW Global can assist anyone in Hong Kong looking for health insurance coverage. As an independent broker, we work for our clients and not the insurance companies. This means our expert brokers will assist you in identifying the coverage that is best place to meet the risks you face, and the budget you have allocated, on a no-cost, no-obligation basis. From there we are able to support you across the lifetime of your plan with dedicated support teams to facilitate policy management and claims handling.

If you have any questions about Hong Kong or International health insurance plans, please Contact Us Today.

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