MEDICAL INSURANCE: HOW IT WORKS



It was just another day at the office for Alex. As he took his seat, a sharp pain jolted through his entire back. The pain shocked him, and soon turned into a numbing, pulsing soreness. He had to ask a colleague bring him to a hospital for a check-up.

Luckily, he had his medical card on hand. At the hospital, he was given outpatient treatment and released, but not before being given a bill for his treatment. This surprised him – wasn’t the medical card supposed to pay for the cost of treatment?



“I DON’T GET IT! WHY AM I STILL EXPECTED TO PAY FOR A PORTION OF MY MEDICAL BILLS, EVEN WITH MY MEDICAL CARD?”

Most people believe that a medical card means total and complete coverage of medical costs, but this is only true to a certain extent. In Alex’s case, his policy was subject to a feature called the co-insurance and the deductible. Co-insurance is a form of cost-sharing, or splitting the cost of the medical service between you and your insurance company. 1

Here is how it works. If you happen to be diabetic, you may visit the doctor on a regular basis. You just paid your RM1,500 deductible, which is the amount you have to pay for health care services before your health insurance begins to pay. From here on out, as your plan includes a 30% co-insurance sharing cost, you will only need to pay for 30% of your medical bills while the insurer pays the remaining 70%. So, if your treatment costs RM150, the plan will pay RM105 and you will pay RM45.1

For Alex, this was his first time using his medical card and he had yet to meet his deductible of RM2,000. Thus, he had to pay that amount before he could enjoy full coverage from his insurer.

The percentage ratio of co-insurance payment depends entirely on your medical plan. If Alex had decided to opt for a medical plan with zero co-insurance and deductibles, this is also possible as he could select a plan like A-Plus Med. This plan in particular provides seamless admissions to 98 panel hospitals in Malaysia, and it can also be expanded to include the policyholder’s spouse and children.

The following week, the pain returned, this time more intensely. After the necessary paperwork at the hospital’s admissions counter, Alex was told to wait for his insurer to issue a guarantee letter before he could be admitted. So imagine his shock when he was informed that his insurer refused to issue a guarantee letter – which means that he has to bear for the cost of his treatment!

“THIS IS UNBELIEVABLE. I THOUGHT I COULD CLAIM FOR ALL MEDICAL COSTS WITH MY CARD! NOW I HAVE TO FOOT MY OWN BILL?”

While a medical card does allow you to walk into a hospital without having to worry about the amount of cash in your wallet, it is not always the case. Along with a medical card, what is also needed is a guarantee letter – especially for more serious medical cases.



“WHAT IS THE PURPOSE OF A GUARANTEE LETTER, ANYWAY?”

A letter of guarantee is a letter of assurance that is offered by the insurer to the hospital confirming that the cost of treatment for the patient will be taken care of by the insurance company.

This would involve background checks to see if Alex had previously experienced similar pain, or have received treatment for pre-existing illnesses (any kind of injury or sickness he may have had prior to his insurance plan).

Depending on the plan, there are certain restrictions to take note of such as non-coverage for any medical or physical conditions arising within 30 days from the commencement of the plan or any on-going treatment or surgery.2 Medical plans are only valid for the treatments for medical conditions that arise after the plan has been implemented.

While a medical card does allow you to walk into a hospital without having to worry about the amount of cash in your wallet, it is not always the case. Along with a medical card, what is also needed is a guarantee letter – especially for more serious medical cases.



“SO, WHAT CAN I DO?”

The insurer usually requires time for investigation of certain cases, so without the guarantee letter, Alex has to make the payment for his treatment first. Not to worry though – all he has to do is attach his proof of payments to a report that he can submit to his insurer’s claims department. If everything is approved, he would be issued a guarantee letter and can seek reimbursement of the initial costs.

“MY INSURER IS NOT PAYING FOR MY MEDICAL BILLS ANYMORE! WHY IS THIS SO?”

In the unlikely event that your insurer does not foot your medical bill, an explanation would be provided. For example, it could be due to you having met your annual limit. An annual limit is the maximum amount of medical claims you are entitled to in a year. If your limit is RM100,000, any medical expenses beyond that amount will have to be borne by you. It’s best to check if your plan has any annual or lifetime limit (the maximum amount claimable in a lifetime).

“WHAT ARE SOME OF MY RIGHTS AS A CONSUMER?”

All insurers have a cooling period (also known as a free look period), which is a time frame to allow a new customer to consider their purchase decision. During this period (usually 15 to 30 days), the new customer can choose to cancel their policy and have their full premium returned.

If you ever find yourself in a situation similar to Alex’s, stay calm. Contact your life planner or your insurer, and have on hand your medical report or necessary paperwork. We’re here to help!

https://www.aia.com.my/en/what-matters/fina...august-wm-ins08

Anyone can advice or recommend whether I should stay with my current life-investment link insurance policy (Prudential rm200/mth) or switch to medical coverage only (premium less than life)? I'm single and 25. Just think with my low salary felt burdened to commit to this monthly.....

I know life coverage include allowance if become vegetable, rm30k for next of kind if passed away, investment profit/loss plus medical coverage 36 serious illness rm600k claimable....

Was thinking to switch to medical coverage will do as I think thatshe my priority but many advice life insurance is better....

I know it increases follow your age each year....If now I give up life insurance and just buy medical card....which is better? AIA , great eastern....or maintain prudential....

Or I should just suck it up and pay....my parents said everyone should have life insurance and in future if buy will be extremely expensive when get older like 30 or 40.....

Any huge difference in premium payment if I change now.....btw I have diabetes type 2....does it make it difficult in future if I wan to buy life insurance....

Pls help....dunno what to do....😟

Hi

I strongly advise you not to cancel your insurance now since you got Diabetes Type 2, you will not be able to apply for any new medical card insurance.

Disability and 36 Critical Illness benefit will also be declined for new policy.

Your only option is only applying for new Life Insurance that covers only Life and Cancer plan.

Between life and medical, you can't say which one is better rather which is the main priority for you right now.

Also, medical card and your critical illness you should know the difference. Meaning medical card will cover all expenses as per policy relating to your treatment in the hospital. As for critical illness protection acts as a income replacement, ie: a lump sum payment. Here's a free tip, read and understand the terms and conditions such as your survival period.

Insurance premium does increase as you grow older but what you should be more concern about is the potential sickness one might get prior to purchasing a medical/life cover as pre-existing illness are usually not covered.

Given your medical condition, you should check with your existing agent for options. Let him/her know your financial situation. For most situation, If you're paying about 6% - 8% of your monthly salary you're alright.

Best,
Jiansheng

This post has been edited by Holocene: Aug 23 2017, 02:06 PM

Understood your predicament, unfortunately if you were to cancel or reduce the insurance, there will be complications to get it back again.

The medical card will be declined for any new application or upgrading.

Thanks all for your input....guess I have to maintain since I have underlying medical conditions already...now I understand....tq again....

Is it possible to make a living without selling to friends and family ?

That depends on you, normally most new agent survive on the first few years on their friends and family.

Just make sure you have sufficient savings to last you for the first few months that you don't make as much sales to cover up your expenses.

Practice on cold call then, is the hardest but rewarding.
Why not sell to friends and family?
Insurance do help lots of people, (or give trouble if agent do shitty thing).
Imagine if your service can help your friend go through tough financial situation, you'll feel very good cause your service help to family to survive.

Google Startup 36 (not 360), see if it good for you or not.

Different agents approach it differently, mine are 95% friends and family. Like they say, make your friends your client and your clients your friends. I'd say my relationship with my clients are quite close.

Share with you all my stories:

Friend:
I initially wanted to approach my friend's brother as he is the managing director of a plantation. But I was a bit shy at that time and asked my friend for an introduction, but the brother told her that he already has a few so too bad for me. Mana tau that time my friend told me "oh you sell to me la... tomorrow come and talk to me and my husband about it." This also happens to be how my first sale happened.

Stranger:
As for stranger, one day a lady texted via WhatsApp out of nowhere. Apparently she found me via Facebook. After going through the details with her, she signed on the first meeting. I later asked her why she decided to see me and she said it was because of the reviews she read and felt I was somebody that she could trust. Later only found out that she used to be a Prudential agent.

As you grow in this industry you'll find that it's quite interesting. No 2 meetings are ever the same. I'm not sure what's your professional/educational background but that's definitely going to have an impact on how you approach situations which will lead to what kind of impression your prospect forms about you and ultimately be part of the decision if they will sign with you. After all, insurance agents are everywhere.

Just remember this, your reputation is something you want to build and preserve. As long as you have that at the back of you're mind you should be alright.

🤓

Best,
Jiansheng

Thanks alot man. Appreciate that.

Thanks

I'm looking for a term life takaful (must be takaful) that covers RM100,000 for 30 years (either 30 years term, or 5/10 years term and renewable until 30 years). Any suggestions?

This post has been edited by imnotabot: Aug 23 2017, 11:06 PM

I don't think term life takaful is available yet, at least I've not heard of it being available yet.

Are you sure? I searched and found some:

- Great Eastern Takaful i-Great Murni: https://www.greateasterntakaful.com/en/abou...reat-murni.html
- Hong Leong MSIG Takaful i-Salam: http://www.hlmtakaful.com.my/products-and-...mt-i-salam.aspx
- Takaful Ikhlas Basic Term Takaful: http://www.takaful-ikhlas.com.my/sites/def...ul_eng_v1.1.pdf
- Etiqa i-DoubleSecure: http://www.etiqa.com.my/en/idouble
- AIA Takaful i-One Plan: https://www.aia.com.my/en/our-products/life...i-one-plan.html

I'm just wondering how to choose between them, since they are mostly the same (same clause, e.g. it doesn't cover suicide) but the premium is different (some have level contribution over the term, others have different premium every anniversary). Should I just go for the cheapest? Two of the cheapest is GE Takaful (male non-smoker starts at RM203 annually) and AIA Takaful (male non-smoker starts at RM206 annually).

What I meant none was the one's sold directly by agents.

Those links you posted are all products that you have to deal directly with the insurance company.

When it comes to term insurance, the benefits of course is cheaper premium while you're younger but will continue to increase as you're much older so you'll need to start putting aside more even though you're paying a cheaper cost now for the future higher premium.

To add on, term insurance coverage normally have lower expiry date, around age 75 - 80 compared to ILP @ age 100.

Try to do more comparison on your own to see which company offers an overall better benefit and the estimated future cost of insurance.

This post has been edited by lifebalance: Aug 24 2017, 08:40 AM

is home insurance is mandatory when serving bank loan? and must take the bank's insurance?

You mean a MRTA/MLTA?

It is not necessary by law but it's the responsible thing to do. Sometimes the bank would give you batter rate if you take up their MRTA.

If you're getting an MRTA/MLTA make sure it covers the person responsible for servicing the loan instalment.

Best,
Jiansheng

not mrta/mlta..

i think it is home fire insurance.. yearly paid..

Yes fire insurance is mandatory because the house belongs to the bank therefore you will need to proof that the house is insured for fire insurance at all times otherwise the bank will auto purchase and charge it into your loan.

This is written in your loan offer letter before you sign on it to agree.

but how does bank determine the sum assured?

i just received the renewal notice (and has been automatically charged to the loan account), and it was assured at 170K but the house value is more than that.