Have you heard stories about people who go bankrupt due to large medical bills, despite having health insurance? It happens, unfortunately, when the coverage taken is the bare minimum and does not account for one’s higher susceptibility to certain diseases. In this article, we break down supplemental health insurance for you.
What Is Supplemental Health Insurance?
As the name suggests, a supplemental health insurance functions to – in addition to what is already present or available on one’s medical coverage – complete or enhance your health insurance. It typically covers anything that the minimum health plans do not cover. Some will pay for out-of-pocket medical expenses like deductibles and co-payments. Some will provide a cash benefit upon a critical illness diagnosis, be it over a period of time, or in one lump sum. It is especially important for bills that go beyond the hospital, like in buying medication and getting palliative care. This cash benefit does not come in the form of reimbursements, which means, often, you can just treat it as a form of replacement income in the event of sickness. Still – do note that supplemental insurance is an add-on, and cannot be used as a replacement for health insurance.
Below are some examples of the best supplemental health insurance available locally and abroad:
Disease-Specific Insurance / Critical Illness (CI) Insurance
Sometimes, your life insurance might provide CI cover in the policy plan too. This add-on focusses on very specific illnesses because some people are more prone to it than others. Maybe due to their lifestyle, or maybe based on the family medical history. An example of CI insurance is the cancer insurance that will pay out if the policy-holder has been diagnosed with any type of cancer listed in the policy. Some policies cover more diseases than others, but this also means higher premiums.
In stark contrast to health insurance, disease-specific or CI insurance plans pay out the cash benefit directly to the policy-holder and not the health care provider. As mentioned above, you may then use it for anything you wish without needing to provide proof of expenses. One could use it for health-treatment costs that are not covered by the health insurance, or, to fund their lifestyle should there be any loss of income. Look no further than PolicyStreet for the best supplemental health insurance which we will introduce in a bit.
Hospital Indemnity Insurance
Hospital stays can be costly. Which is why the Hospital Indemnity Insurance pays a fixed amount simply upon hospitalization and can be considered as one of the best supplemental health insurance out there. There are various plans for the number of days the pay-out is given or if it’s just one lump sum. We say fixed, because the rate is going to be the amount stated on the policy, and not the amount stated on your hospital bill. So if you have extra, do what you will with it. Because sometimes, it’s not about the payment to the hospital, but about the payments caused by your confinement to the hospital. For example, housekeeping, or pet-sitting.
(Personal) Accident Insurance
Accident policies can be split into two: Accidental Death and Dismemberment and Accident Health Insurance. The former works like life insurance, in which a lump-sum amount of cash is paid upon death or total permanent disability. The latter, may pay for outstanding medical costs that are not covered by your regular health insurance, should they be incurred due to an accident. This insurance can also help you with covering living expenses while you are healing.
Dental Insurance / Orthodontic Insurance
Everyone has one set of teeth, which makes it that much more important to protect it for life. Therefore, dental insurance also ranks as one of the best supplemental health insurance you may obtain for yourself. Dental Insurance works very similarly to a normal health insurance, with yearly maximums and pay-outs made directly to the dentist based on covered dental services. People used to purchase this mostly for children, especially in preparation for braces, but this insurance could also be great for adults, in getting dentures and doing the regular scaling. Of course, you’ll have to check the coverage before making the purchase and signing up for random operations at your dentist’s office.
Slightly on the rare scale in Malaysia, this is designed to help cover eye exams and prescription glasses. Some even cover eye correction surgeries. Just like dental insurance, the pay-outs are made directly to the clinic or hospital, and there are typically annual maximums.
We hope that more and more insurance companies in Malaysia would jump on the bandwagon of creating one of the often demanded and best supplemental health insurance here.
Conclusion: Do you need it?
Big question. Some people say no, because that’s what health insurance is for. But after reading the above, you may want to get insurance beyond the minimum based on your risk factors and your affordability. Dental insurance could be super worth it for your kids if you foresee them needing braces in the future. Whereas critical illness insurance could be highly beneficial if you think your savings are not enough to cover your daily expenses during the healing period.
At the end of the day, it’s really just optional, and your calculation of risk may not be the same as mine. Because life is uncertain, we could never know for sure what is excessive or insufficient coverage. But we do our best.
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