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Why your company’s health insurance plan may not be enough for you and your family

Suneeti Ahuja-kohli
Filed on June 12, 2014

Consider getting yourself a comprehensive insurance plan beyond that provided by employers.

It was not long ago when newspapers in Dubai started calling out to readers for monetary support for an expatriate struggling to keep up with the rising cost of hospitalisation for his prematurely delivered son.

Working as a storekeeper in Dubai, he earned a few thousand dirhams and did not have health insurance or a contingency fund to take care of any medical exigencies. A prematurely delivered son required treatment in an Intensive Care Unit, and he clearly lacked the means. Consequently, the hospital bill amounted to about Dh200,000 in just a few days.

The good part is that lady luck was by his side. Readers poured in to help in a matter of few days. The baby was treated and discharged from the hospital after paying the dues. But that’s not how life pans out every time one faces such unforeseen medical expenses. The rising cost of medical care doesn’t help either. As per industry experts, medical inflation in the UAE has been rising by 15 to 20 per cent for the last three years.

The new law by the Dubai government mandating a health cover policy for all is therefore a progressive step to ensure well-being for all employed.

Initiated by the Dubai Health Authority, the legislation was signed into law by His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, in November.

Phase one of the scheme requires companies with 1,000 or more employees to provide their workers with health insurance by October.

In phase two, companies with 100 to 999 employees will have until the end of July 2015 to comply. Companies with fewer than 100 workers have until the end of June 2016 to provide coverage.

According to the law, companies are only required to cover the cost of health insurance for their employees and not the employees’ dependents. The law would push Dubai's insured population to three million by 2016, from its current level of one million people.

In addition, health coverage for spouses and children of expatriates in the UAE has also been made mandatory and residence visas for family members will not be re-issued without health cover.

Here's a lowdown on what health insurance is all about:

Basic plan

A basic health insurance plan covers you against expenses incurred during hospitalisation. It also covers pre- and post-hospitalisation expenses typically up to a month. This cover is invoked only on account of accidents or if contracted an ailment it is not applicable for diseases, which already existed at the time of buying the policy.

For the young, basic health insurance is sufficient and easy to get and so essential is its existence that most of the employers have begun offering medical insurance to their employees. You, however, should not use this as an excuse to shy away from getting yourself one personally and at the same time begin to stack away some wealth to prepare for any medical attention.

The reason why you shouldn't just hinge on your employer's medical cover is that the policy stays with you for as long as you stay with the employer and terminates the minute you move out. Your next employer might be offering medical cover and you have the option of renewing your previous policy with the new organisation but you run a potential risk: If in the switch between the two companies there has been a gap for more than seven to 15 days, the insurer of the new organisation will treat you as an entrant and hence will issue you a fresh policy.

The risk that you take is that any claim on account of a disease will be treated as pre-existing and therefore denied. When the policy is renewed the insurers cannot deny you cover against a disease that might have led you to invoke the claim in the past.

Taking cover young also helps you getting bonus on your sum insured till a maximum of 50 per cent. For those above 60, however, the options are limited.

Floater plan

This is the second most popular variant of medical insurance. Popular with families, this plan considers the entire family as one unit and issues cover on that unit. Here the advantage that you so get is lesser premiums since the premiums are decided on the basis of the elder most in the family and not on an individual basis.

But the disadvantage that weighs more is the fact that the entire family shares the same cover and if one invokes the cover, the cover on the rest gets reduced by that much amount. Check with your employer, chances are, that he would have given you a floater. Leave that be, get yourself insured individually. Insurers typically give you a discount of about five per cent on the premium if the entire family buys health insurance from the same insurer.

Critical illness plans

These plans have become the flavour amongst life insurers. This cover is either bundled with the main plan or is offered to you as a standalone. Critical illness typically offers you lump sum reimbursement upon diagnosis of typically six critical illnesses: Heart Attack, Major Organ Transplant, Cancer, End Stage Renal Failure, Coronary Artery Bypass Graft Surgery and Stroke. Once this lump sum is paid out, the policy ceases.

But the downside of it is that once the claim is invoked, the policy ceases to exist, so in the subsequent years the policyholder is left uninsured. Moreover, the policyholder needs to survive for a month from the date of diagnosis to claim the sum. An early death and the entire claim can be refused. The hospitalisation cost however has to be borne by the policyholder till the time he gets the insurance money.

If you want to buy critical illness policy to bump up your sum insured, go for a separate health insurance policy along with critical illness policy. Clubbing them would lead to loss of both if you invoked the cover.

List of health insurers in the UAE

Abu Dhabi National Insurance Company
Abu Dhabi National Takaful Company - Takaful
Al Ain Ahlia Insurance Company
Al Buhaira National Insurance Company
Al Dhafra Insurance Company
Al Fujairah National Insurance Company
Al Khazna Insurance Company
Al Sagr National Insurance Company
Al Wathba National Insurance Company
Al-Ittihad Al-Watani General Insurance Company
Alliance insurance Company
American Life Insurance Company
Arab Orient Insurance Company
Arabia Insurance Company
Arabian Scandinavian Insurance Company
AXA Gulf
Daman, National Health Insurance Company
Dar Al Takaful pjsc
Dubai Insurance Company
Dubai Islamic Insurance & Reinsurance Co (Aman)
Emirates Insurance Company
Green Crescent Insurance Company
Iran Insurance
Islamic Arab Insurance Company (Salama)
Lebanese Insurance Company
MetLife
National Life & General Insurance Company
Noor Takaful Family PJSC
Oman Insurance Company
Qatar Insurance Company
Ras Al Khaimah National Insurance Company
Royal & Sun Alliance Insurance (Middle East) Ltd
Saudi Arabian Insurance Company
Takaful Emarat
Union Insurance Company PSC
United Insurance Company
Zurich Insurance

— suneeti@khaleejtimes.com


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