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Health insurance hasn’t always been a necessity for most people, especially those with access to public healthcare. Being one of the countries to have public healthcare, Malaysia was once awarded the title of ‘Best Healthcare in the World’ by International Living in 2019. So is there really a need to have health insurance in Malaysia and if you have it, is it just bragging rights?
Is Health Insurance in Malaysia Worth It?
To understand further, we invited life planner Yvonne Leong to our YouTube segment, Debug, to uncover the truth of the commonly heard statements about health insurance.
Statement 1: Employee Health Insurance Is Sufficient
Employee health insurance in Malaysia shouldn’t be seen as comprehensive protection of your health, but rather as an employee benefit. That said, it does not mean it is not good, it is. It’s just that it is not sufficient to cover any major or critical illnesses due to its low annual limit. Most employee health insurance tends to have an annual coverage of lower than RM50,000.
That sum of coverage will not be sufficient if one were to get medical care from private hospitals where the cost may easily be in the tens of thousands. The low annual coverage can be a huge limitation to many, hence relying solely on employee health insurance may not be the safety net that one had thought it to be.
Statement 2: I Am Immediately Covered Once I Start Paying My First Premium
This is a huge misconception that many get caught off guard believing it’s true. When one applies for insurance, they pay the insurance premium but that does not immediately get enforced.
The insurance company needs a day or maybe months to get proof of your policy. Once the policy has been approved, there is a waiting period. That waiting period is from 30 days to 120 days. So any medical claims that fall within the waiting period may not be covered.
Statement 3: I Don’t Need Health Insurance Because I Can Get Free Medical Care at Government Hospitals
Correct, but if everyone were to have the same opinion and act that way, it won’t be long before government hospitals run out of capacity.
With an influx of patients, the medical staff are spread thin and are not able to give sufficient care or treatment, like in the case of COVID-19. When that happens, treatments and procedures are forced to postpone. That’s where private hospitals come in, as an alternative.
Statement 4: Having Health Insurance at a Younger Age Is Better
Most people are likely to be healthier at a younger age. At one age, it is expected that one will have some health issues along the way. When that happens, insurance companies will prevent pre-existing and possible illnesses from being covered, which defeats the purpose of having insurance.
Although they can be appealed to have these illnesses covered, it can be very costly. Hence, getting insurance at a younger age is better because it’s cheaper.
Statement 5: Lower Premium Equals Lower Coverage
This is not necessarily true. There are a number of plans out there that cater to different needs because everyone has different needs.
It is important to look for an insurance policy that meets your needs be it emphasis on health, critical illness, income protection and life. So the notion that a higher premium equals higher coverage is not necessarily true, it depends on what is covered in the policy rider.
Statement 6: Health Insurance Pays the Entire Hospital Bills
Although health insurance is designed to foot the whole medical bill, there are however some areas in which they won’t. Things like admission fees, COVID-19 tests, and certain medical equipment like latex gloves, surgical masks etc are not borne by the insurer. Therefore, it is wise to bring along cash or a credit card to make payment upon being discharged.
Statement 7: Childbirth Is Covered Under Health Insurance
This is another misconception by many. Childbirth is not covered under health insurance simply because it is neither an illness nor disease – it is manmade. However, pregnant women are encouraged to have prenatal insurance to cover any pregnancy complications. That said, it still does not cover the cost of childbirth.
Statement 8: Health Insurance Is Tax Deductible
The Malaysian government has made health insurance tax deductible capped at RM3,000 per annum for oneself, a spouse and children. It is a win-win, one will get to keep their family safe while paying lesser taxes.
Statement 9: Health Insurance Has an Expiry Date
Every health insurance policy is different, some covers up to the age of 65 and some until 100. They are not the same, so one has to constantly review the policy to make sure that their policy is not expiring soon.
It is advised to take a policy that will expire at the latest date possible to have peace of mind. This is because, should one become ill at a ripe old age, one would still be covered.
Statement 10: My Premium Is Cheaper if I Don’t Declare My Pre-existing Conditions
Absolutely true, one’s health insurance premium is definitely cheaper if they do not declare their pre-existing condition.
HOWEVER, when it is time to make a medical claim, and if the insurance company finds out that one did not disclose their medical history, the former has every right to decline and deny the claim. This ultimately defeats the purpose of being insured.
#FinancialAdvisor: Protect Yourself and Your Loved Ones With Health Insurance
We asked Yvonne for a piece of advice she could give our viewers and readers. “If you currently have health insurance, good for you! But if you don’t, go talk to a financial advisor, and ask them what could be done because health insurance is not as costly as you think”, advised Yvonne.
She added “all you want to do is to transfer your risk to the insurance company especially if you are sick regardless of minor or major illness, why gamble on your health? The last thing you would want to worry about is a financial burden.”
If you are looking for comprehensive health insurance in Malaysia without breaking the bank, you can get it at Qoala. Qoala offers a variety of insurance and takaful ranging health, car, motorcycle, travel, personal accident and property.
