Health coverage: Are you overinsured?

Many Singaporeans complain about paying high premiums for health insurance plans, especially after last year's rather steep rise in premiums, with some premiums more than doubling.

But what most of them don't realise is that they are probably forking out such high premiums because they have over-insured themselves and are paying for a level of insurance they are unlikely to need.

Today, more than two million Singaporeans and permanent residents are paying for higher medical insurance coverage than offered by the basic MediShield. They are on Integrated Shield Plans or IPs, which ride on the basic MediShield, but offer higher payouts based on private hospital rates or the equivalent of being treated as private patients in a public hospital.

This is good since the basic insurance is pegged at subsidised B2 and C class rates and will not offer enough coverage for those opting for a higher ward class, such as B1 or A class in a public hospital.

What is surprising, however, is that more than half of those on IPs, or 34 per cent of all Singaporeans and permanent residents covered by MediShield, have opted for the most expensive plans - those pegged at treatment in private hospitals. This does not reflect the actual usage of hospital care today, with less than 20 per cent of local residents opting for private hospitals and the rest going to a public hospital.

Do one in three Singaporeans require private hospital medical insurance when fewer than one in five are treated at private hospitals?

Why do so many buy insurance plans they are unlikely to use?

They do so partly because it is easier to downgrade a health insurance plan than to upgrade. Four of the five insurers - NTUC Income, Great Eastern, AIA and Aviva - have plans in all three IP categories. Prudential no longer offer IPs for public hospital B1 wards.

Also many buy into the plans when they are young and when the premiums are highly affordable. Up to the age of 49, Medisave can fully cover the premiums charged for these private plans, so policyholders do not feel the pinch of out-of-pocket payments

But from age 50 onwards, policy holders will have to top up their premium payments in cash, as the premiums all exceed the $800-a-year cap for premiums paid with Medisave. Each year, up till the official retirement age of 62, they will need to top up their premium payments with cash amounting to several hundred dollars. But again, as many are still working, the amounts appear affordable.

But beyond the age of 62, premiums rise steeply, averaging $4,000 a year for those aged 75. The highest premium currently charged, at the age of 100, is $8,483 a year.

Today, on average, men can expect to live to the age of 80 and women 84.5 years. A man aged 65 in 2012 can expect to live to the age of 83.5 years and a woman to 86.9 years. And life expectancy is still going up.

Already, there are more than 10,000 people aged 90 years and older and close to 1,000 who have passed the century mark.

Based on current premiums, people on private hospital plans will need to pay between $120,000 and $180,000 in premiums for those 30 years after retirement, depending on which insurer they are with.

Unless they buy riders, which pay for the portion of their hospital bill which they will still need to pay in spite of insurance, they will also need to pay thousands, perhaps even tens of thousands of dollars, for their hospital treatment.

Riders which start at about $30 a year for children, go up to about $2,000 a year for seniors.

The actual amount people will need to put aside is likely to be far higher, as health inflation has always been higher than general inflation, and premiums will rise as cost of medical treatments goes up.

So those who opt for insurance pegged at treatment in private hospitals must ask this basic question: Can they afford the thousands of dollars in premium payments in their post-retirement years?

Different people have different priorities, as well as different levels of savings. After doing my maths recently, I've decided to downgrade my medical insurance plan.

One reader wrote to me to say that she opted for the top plan, and pays extra for a rider, so she will not need to pay any out-of-pocket expenses should she need to be hospitalised. She said: "Even though the premium and rider are costly, I am determined to continue with my plan for as long as I can. In the worst-case scenario, I am willing to cut down on my transport and food to service my plan, including the rider."

She has considered her options and made her choice. But not many people have given as much thought to their IPs.

I prefer to downgrade and spend more on living healthily and getting regular health screening to stay healthy and out of hospital.

And should I fall seriously ill in my old age, I will turn to public hospitals, which have excellent doctors and whose bills I can probably afford on my downgraded health insurance plan.

Comparisons of premiums alone may be misleading

We refer to senior health correspondent Salma Khalik's commentary ("Help! I'm confused about health insurance plans"; Dec29 last year) and Mr Sia Cheong Yew's letter ("Clear air over confusing health insurance plans"; last Sunday).

Integrated Shield Plans are designed to cater to different segments of the population. Individuals have diverse needs, requirements and levels of affordability.

The ever-increasing costs of health care - coupled with a rapidly ageing population that will consume more health-care services, as well as a growing segment of affluent people who wish to access premium health-care services - have resulted in a wider spectrum of health insurance plans and supplementary benefits, which cater to different budgets and market segments.

Premium comparisons on their own may be misleading as the benefits differ between insurers.

Integrated Shield Plans offered by life insurance companies are long-term financial contracts that provide additional benefits and coverage to supplement the MediShield scheme.

Policyholders of integrated plans are given guaranteed renewability throughout the tenure of the plans, regardless of their future health conditions.

In pricing Integrated Shield Plans, life insurers take into account the benefits and features of each plan, as well as the projected incidence rates and utilisation, based on market statistics and the insurers' own experience.

Similar to other medical plans, pricing of integrated plans is subject to regular reviews to reflect emerging trends and benefit modifications.

Life insurers have always been committed to being progressive and responsive, constantly looking to enhance basic benefits as well as innovate with new features to meet consumers' evolving needs and expectations. Hence, the number of plans available to give consumers choices that best suit their individual needs.

We encourage consumers to seek advice from their financial advisers about the options available for Integrated Shield Plans that best fit their needs and means.

Pauline Lim (Ms)
Executive Director
Life Insurance Association Singapore
ST Forum, 12 Jan 2014

Insurers should treat customers better
If they can't explain premium increases and policy changes plainly, they need closer regulation
By Han Fook Kwang, The Sunday Times, 12 Jan 2014

Like thousands of other Singaporeans, my annual health-care insurance letter came in the mail last month.

It was time to renew my insurance plan.

I usually don't give it a moment's thought because the premium is automatically deducted from my Medisave account. No action needed - so no need to fuss over it or read the fine print.

Or so I thought.

But this year's letter was different.

It started by saying there were going to be improvements to my MyShield plan, in line with the recent announcement by the Health Ministry.

That's when I knew it wasn't going to be business as usual.

The new premium was now $1,589.08, and since the maximum I could use from Medisave was $800, a payment of $789.08 was due, the letter stated.

It was the first time in years I would need to use cash to renew the plan.

But how much more was it compared to last year? There was no mention in the letter, and since I couldn't find last year's, I had no idea.

A quick call to the company revealed the answer - $800, fully paid by Medisave.

So, my premium had doubled, give or take a few dollars.

Now, if you are asked to pay twice as much for a product, you would expect some nifty new additions or improvements to justify the hefty increase.

There was something about the letter, though, that made me lower my expectations.

I think it was this line: "These revisions are necessary in order for us to stay aligned with the latest claims experience, so we can keep up with Singapore's changing healthcare landscape."

That was it?

Because health care was now a landscape - and changing - I now had to pay double?

Wait, there was a four-page annexe listing details of the changes.

But try as I did, I could not find anything in the list relevant to me. In fact, only two items sounded like anything new: the improved plan now covered cornea transplants (how many corneas get fixed this way every year?), and Accident and Emergency (A&E) treatment within 24 hours prior to hospitalisation.

The rest read like very minor tweaks and clarifications to the original plan.

One other item on the list made my blood pressure rise - my deductible had now gone up. That's the amount you pay in cash before the insurance kicks in. In my case, it went from $3,000 to $3,500.

So, to recap: My premium doubled and my deductible amount increased by $500, for some very small additions to my original plan.

I believe most other Singaporeans received similar letters, were asked to pay more, and had their deductible raised.

But because I had opted for an A Class ward plan, my increases were probably among the steepest.

Can insurance companies raise their charges this way without asking their customers whether they wanted these changes?

Since MediShield is a national health insurance scheme, do they need government approval to do so?

Who regulates their business to make sure what they do is in the public interest?

These questions are especially pertinent now because there is a government-appointed committee looking at how best to implement a new scheme called MediShield Life that is being touted as the next big thing in health-care financing.

The new approach is meant to give Singaporeans "greater peace of mind", according to Health Minister Gan Kim Yong.

That's a heroic promise to make, but I didn't get much of it from my insurer's latest moves.

How then to make good on the pledge and ease Singaporeans' health-care worries?

Here are my three suggestions for the MediShield Life committee to consider.

First, there has to be some degree of stability and predictability to the premiums to be paid.

It would be unrealistic to expect them to be frozen in time. But premiums should not be allowed to be doubled arbitrarily from one year to the next without reasonable justification.

For those approaching retirement, it is a big worry. Would we be able to afford these premiums and deductibles over the next 20 years or so, if they keep rising?

Second, what about having an incentive built into the plan for those who stay healthy and have not made any claims, similar to the no-claim bonus scheme in motor vehicle accident insurance?

In the latter case, premiums can go down by as much as 50 per cent for those with accident-free records.

And what about even lower amounts for those who are health-conscious, exercise regularly and take their medication religiously?

Third, there has to be greater transparency in the way insurance companies operate and conduct their business.

My colleague, Salma Khalik, wrote last week in this newspaper how premiums can vary by as much as 100 per cent, from one insurer to the next, even when they involved exactly the same plans.

Because most people don't really understand health insurance and whether one plan is better than another, they depend on insurers to be open, accountable and honest about their products and how they work.

If insurers are unlikely to do this on their own, they need to be regulated much more stringently so that there are minimum standards of transparency and disclosure.

The funny thing about my own insurance plan is that I know I won't need to use it even though I've just paid to renew it.

Why?

It's because I'm already covered by the company I work in as part of its staff benefits.

Yet, I'm compelled to buy my own health insurance in the event I leave the company or when I retire.

If I don't, I risk not being able to get myself insured when I no longer enjoy my company's medical benefits.

Like many others, I have been dutifully paying for years, for insurance cover I don't need but will eventually do.

Who benefits from this wasteful arrangement?

You guessed it, those same insurance companies which get two premium payments - from me and my company - and then go on to promptly raise these premiums.

There should be a way to avoid this unnecessary duplication which only adds to the total health-care cost of the country.

But please do this quickly before I retire.

Why Integrated Shield premiums had to go up

There has been much discussion on Integrated Shield Plans in recent weeks.

The coverage they offer is generally comprehensive, covering the bulk of hospitalisation costs, some pre- and post-hospitalisation expenses, as well as certain non-hospitalisation charges relating to chronic disease treatments.

Importantly, the renewability of such plans is guaranteed, which means insured persons who make claims continue to be insured by paying the standard premium rate. Policyholders also get to select their level of benefits to match their choice of either public or private hospital and the ward type.

Such plans are integrated into the basic MediShield plan; the premium includes the basic MediShield plan premium. Policyholders who purchase additional "on-top-of-the-basic" coverage can claim higher benefits.

Claims made under the basic MediShield plan and Integrated Shield Plan are administered by the insurers.

Integrated Shield Plans operate in a competitive market environment, and consumers can obtain a comparison of these products in the Ministry of Health's website.

The pricing of a health plan is predominantly driven by the costs of medical health care in Singapore. The costs include doctors' charges, hospital charges and drug fees, all of which are beyond what insurers alone can effectively control. Health insurance essentially acts as a risk-pooling mechanism.

In March last year, there was an upward revision to the benefits and, hence, premium rate of the basic MediShield plan.

In turn, insurers revised their Integrated Shield Plans. This necessitated revision to the premium rates, not only to absorb the increase in the premium rate for the basic MediShield plan, but also to reflect enhanced benefits and escalating medical costs over the recent years.

On an individual level, the policyholder pays higher premiums when he moves from his current age band to the next one.

In July 2012, the Health Ministry revealed that the number of MediShield claims made per policyholder had increased by 9 per cent a year, while the average payout per policyholder had risen by about 12per cent a year.

The Integrated Shield Plan claims experience has been similarly affected. This explains the large increases in premium rates. Also, the last adjustment made was in 2008/2009.

Ultimately, the objective of delivering universal and sustainable health care to Singaporeans can be achieved only collectively, whereby inflation in health-care costs is effectively managed, the funding mechanism is optimised, and overall consumption of health-care services is lowered through improved health of individuals.

Learn More About Health Insurance - History

Health Insurance - Insurance practices, broadly, has a long history associated contracts and procedures designed to protect people from loss of property. Guarantees on loans and insurance based property attention in the distribution of goods through the shipping in ancient times is the insurance model that emerged thousands of years ago, before the year AD. And in the life insurance also has a long and distinctive history that reflect the human consciousness of his own death. In the case of health insurance also has a growing history, which was originally the standard of service indicated in the form of the exchange fee.

Beginning in Mesopotamia, under the guidance of the Code of Hammurabi, is defined that a successful health care, which is characterized by operation with a knife, get paid appropriately. That is, when the patients come from the top, then the operating cost increases to be paid in accordance with its economic capabilities. However, if the operation fails, then the physician or surgeon in charge will pay a fee to the patient. In other words compensation and liability is a form of health insurance at the beginning of human civilization.

But the agreement in the health insurance is really a vital issue and controversial in the early 20's, where health services performed in institutions and the more advanced packaging, and cost of services continues to increase. And what could be touted as a private health insurance plans first became available in the United States during the civil war going on there. Health insurance plan is an insurance that protects the individual from any accidents caused by trains and the like. Health insurance companies are Massachusetts Health Insurance of Boston, which offers insurance policies that offer benefits in 1847. The success of the health insurance plan is so successful, so that the service develops in the form of programs that are more diverse, like health insurance and disability due to illness.

Although the health insurance business in a modern first appeared in the United States, but the term used at the time the insurance company is an insurance for illness or sickness insurance. English is the first officially used the term "health insurance ". It is contained in the official rules of the UK, the National Insurance Act, in 1911, and later the term was widely known.

Unfortunately, in the period of the 1920s, most people still feel that health insurance is not important. But in early 1930, a group of teachers who teach in the city of Dallas took the initiative to cooperate with a number of hospitals there to provide both health insurance plan for its residents. In collaboration, they together determine the type of disease and duration of hospitalization will be borne by the level of health insurance premiums paid in advance by the owner. Hospital services are paid in advance is very helpful people there with the cost of their treatment, especially when the depression that hit the United States economic in the 1930's. Health insurance model is then recommended by the American Hospital Association to adopt another hospital outside Dallas. And then this model also grew to countries outside the U.S., through a variety of health insurance companies.

Breaking Bad and the Healthcare System

There’s a meme floating around that the storyline of Breaking Badconstitutes a scathing indictment of the U.S. healthcare system. The latest entry is this comic strip, which says that if Breaking Bad had been set in the U.K., it would be an “entirely different story” – one that ends in just 5 panels. But it’s not just comic strips. Daily Kossays that Breaking Bad “Displays [the] Brutality of American Private Health Insurance Non-System,” while Tricia Romano at the Daily Beast says the show “Is Fully Dependent on Our Broken Health-Care System.” There are probably other examples.

The problem with this claim isn’t that the U.S. healthcare system is actually wonderful. It’s not. The problem is that it’s just not consistent with the actual TV show. I can verify this because I’ve rewatched the whole first season (and much of the second) over the last couple of weeks. 

Walter White makes his first foray into the meth business before health expenditures are even mentioned. Walter does have insurance coverage, and his HMO will cover his cancer treatment. It’s true that Walter mentions that his HMO isn’t very good at some point, but that’s as far as it goes. As it turns out, Walter doesn’t even intend to endure the treatment (as revealed a few episodes later in “Cancer Man”). It’s very clear that Walter’s overriding goal is to leave a nest egg for his wife, disabled son, and unborn baby.

Eventually, health costs do become an issue when Skyler pressures Walter to undergo treatment after all. But it’s not because his HMO won’t pay. It’s because Skyler finds an oncologist who is not just one of the best in Albuquerque, but one of the top 10 oncologists in the nation. It turns out this super-doctor with his fancy cancer treatment is not covered by the HMO, and the out-of-pocket price is $90,000. Some will say that’s the smoking gun that indicts the U.S. healthcare system. But there is no system in the world that offers high-end care to everyone. The vaunted U.K. and Canadian systems offer care to every citizen, but they don’t offer the best care to every citizen. That’s just not possible. A single-payer system is essentially a giant public HMO, and just like private HMOs, they sometimes deny treatment or (more relevant here) deny the highest-quality treatments. Citizens who aren’t happy with the coverage provided by the government system have to pay for it themselves, either through supplementary private insurance or out of pocket. Sometimes they even travel to foreign countries, like the U.S., for that care. 

To reiterate: Walter White has health insurance, and it would have covered his cancer treatment. The only reason Walter needs so much money for medical bills is because he opts out of his insurance coverage in favor of higher-quality, more expensive treatment. And even then, it’s clear this isn’t Walter’s only motivation. In the episode “Seven Thirty-Seven,” Walter calculates how much he needs to sock away, and he comes up with $737,000,not just the $90,000 for the cancer treatment. This is a story that could have been told in many countries, including both the U.K. and Canada. 

I’m not saying we can’t imagine a version of Breaking Bad that does condemn the U.S. healthcare system. For instance, they could have had Walter lose his job, and his health insurance with it, right before getting his cancer diagnosis. Less plausibly, they could’ve had his deductible and copayments be so large that he has to cook meth to pay them. (I say “less plausibly” because while those sums can be large, they’re probably not large enough to explain Walter White’s extreme actions.)

But Breaking Bad did not choose either of these routes. In fact, the show often goes out of its way to show that ultimately it’s not really about money at all for Walter; it’s about pride. Pride is why he didn’t want to have treatment in the first place. When his former colleague Elliot Schwartz offers to pay for Walter’s non-covered cancer treatment, it’s pride that makes Walter say no. And pride is why Walter continues to cook meth long after he’s achieved his monetary goals. Blaming the events of Walter White’s life on the U.S. healthcare system isn’t just wrong; it’s missing the entire point of the show.

Jockeys and Health Insurance

Recently, the Jockeys Guild has been making a strong push for someone, anyone really, other than the jockeys, to provide health insurance for riders and their families. In New York, the Governor's Office has convened a Task Force on Jockey Health and Safety to consider that issue, among others. The Task Force is chaired by NYRA Director and thoroughbred owner Anthony Bonomo and includes jockey John Velasquez, retired rider Ramon Dominguez, Jockey Club staff member Nancy Kelly and attorney Alan Foreman, who represents a variety of horsemen's groups, including the New York Thoroughbred Horsemen's Association ("NYTA").

Disclosure: I've been a member of the NYTHA Board of Directors since 2002. I also have some knowledge of health care issues at the track, through my involvement as a Director since 2009 of the BEST Backstretch health care program, which provides basic health care and substance-abuse services for backstretch workers at NYRA Tracks.

I've been told that a major item of discussion at the Task Force meetings has been: who should pay for health insurance for jockeys and their families? As I understand the Jockeys Guild position, it's that either the race tracks or the owners and trainers should bear this cost, and not the jockeys themselves, except perhaps to the extent of a very limited contribution.

Seems reasonable, right? After all, owners, trainers and track executives aren't the ones taking the risk of riding a 1,200-pound animal at 40 miles an hour in close company and under sometimes less than perfect conditions. Jockeys literally put their lives on the line every time they ride, so shouldn't they get our help?

But a closer look at the situation, at least in New York, raises some questions. Is financing health insurance for jockeys and their families really the best use of money from tracks' budgets, when many needed repairs are still waiting on limited budget funds? Is taking yet another slice off the top of owners' purses to pay for that insurance wise at a time when, despite slots-enhanced purses, most race horse owners still lose money? Why provide health insurance for jockeys when trainers, many of whom earn less than jockeys, have no insurance plan from the track and have to buy their own personal or family coverage?

In some racing jurisdictions, where purses are low, jockeys don't have coverage for on-the-job injuries, and jockey income flirts with the poverty line, perhaps there's an argument to be made for assisting jocks with health insurance premiums. But in New York at least, that argument doesn't apply. Here's why:

First, jockeys in New York already have two forms of insurance coverage for work-related injuries. The Jockey Injury Compensation Fund provides workers compensation coverage, including ongoing medical care, for on-the-job injuries to jockeys and exercise riders. The Fund is financed by owners, through a deduction from purses, and by trainers, through a per-stall fee that is probably usually passed along to owners as part of the trainer's day rate. In addition, NYRA pays for an accidental death and injury policy that pays those jockeys who sign a waiver (agreeing not to sue NYRA) 10 times their annual earnings, up to a maximum of $1.3 million, if the jockey is paralyzed and up to $956,000 if the jockey is permanently impaired. Those payments are on top of the workers compensation payments through the Jockey Injury Compensation Fund.

Second, jockeys in New York make a pretty good living. Using statistics available from Equibase, it's possible to calculate the gross earnings of most regular New York riders. In New York, jockeys generally get 9.17% of a win purse, 5% of second-place money, and 7.5% of third-place money. Because win purses are the major element in any jockey's income, this works out to a blended rate of about 8% of total purse money won.

Using those parameters, and using the Equibase data for 2012, the first full year of slots-enhanced purses in New York, one can calculate that 22 jockeys made over $100,000, just from their rides in New York, not counting anything they earned out of state. For example, the now-retired Ramon Dominguez had purse earnings of over $19 million in New York, of which his share was in excess of $1.5 million. Other jockeys who earned over $400,000 just in New York include Cornelio Velasquez, Junior Alvarado, Javier Castellano, Irad Ortiz Jr., Jose Lezcano, David Cohen, Eddie Castro, Alan Garcia, John Velazquez, Rajiv Maragh, Joel Rosario, and Rosie Napravnik. Using the same methodology, we can conclude that the following riders made between $100,000 and $400,000 just in New York in 2012: Jose Ortiz, Wilmer Garcia, Mike Luzzi, Samuel Camacho Jr., Edgar Prado, C C Lopez, Jose Espinoza and Corey Nakatani. Adding in jockeys who earned less than $100,000 in New York but who had earnings elsewhere that would lift them above the $100,000 threshold would add the following to the list: Jose Rodriguez, Kent Desormeaux, Dennis Carr, Joe Bravo, Shaun Bridgmohan, Pablo Morales, Luis Perez, Jose Valdivia Jr., Chris DeCarlo, Pablo Fragoso, Alex Solis, Jaime Rodriguez, Mike Smith and Kevin Navarro.

Update (1/16/2014): I just ran the 2013 numbers, using the same methodology. They show that 24 riders likely earned over $100,000 just in New Yoerk. In order: (a) over $400,000 -- Javier Castellano, Irad Ortiz Jr., Junior Alvarado, Jose Ortiz, John Velazquez, Cornelio Velasquez, Joel Rosario, Jose Lezcano, Luis Saez, Rajiv Maragh; (b) $100,000-$400,000 -- David Cohen, Edgar Prado, Alex Solis, Mike Smith, Manuel Franco, Eddie Castro, Rosie Napravnik, Mike Luzzi, Joe Rocco Jr., Guillermo Rodriguez, Keiber Coa, Abel Lezcano and Angel Arroyo.

That's a lot of riders with incomes that many racegoers wouldn't mind having. True, jocks generally pay their agents 15-25% of their earnings, and their valets get 5-10%, but still, these are solid, middle-class incomes, and well above the national average.

Moreover, jockeys in New York have received a substantial pay raise as a result of the increase in purses since 2011 fueled by slot-machimne revenue. Still using our 8% methodology, we can calculate that aggregate jockey earnings at NYRA tracks increased by some 40% from 2011 to 2012, right in line with the increase in purses in that period.

In the past, jockeys had a strong argument for having the tracks and/or owners supply health insurance, because most riders would have "pre-existing conditions" that insurance companies would cite in order to deny coverage. But, under the Affordable Care Act ("Obamacare"), insurance companies can no longer use that excuse; they must make standard policies available, regardless of pre-existing conditions.

Jockeys are independent contractors. With rare exceptions, they are not employees of a particular trainer or owner (for a taste of the bad old days, when they were, listen to Slaid Cleaves' song "Quick as Dreams," about Jockeys Guild founder Tommy Luther.) Like solo practice lawyers, free-lance writers or, for that matter, horse trainers, they're responsible for themselves. Unlike those other categories, though, at least jockeys have pretty good insurance coverage for work-related injuries.

Given that on-the-job coverage, given that insurance companies can no longer deny them and their families routine health insurance, and given their level of income, at least in New York, it's hard to make a case that jockeys should be treated differently from other independent contractors and sole proprietors. Those that have high incomes -- and I was surprised by how many there were in that category in New York -- can buy comprehensive health insurance for themselves and their families in the market. Those with lower incomes can use the Affordable Care Act's insurance exchanges to obtain very acceptable policies and, if their incomes are low enough, can get tax credits and subsidies to cover part of the premium cost.

The New York Task Force on Jockey Health and Safety can do a lot of good things. Improving vests, helmets and other protective equipment would help. So would stiffer standards for licensing riders, to make sure they're up to the level of competition in New York, and ongoing continuing education programs. So would providing nutrition advice so riders can keep their weight down without destroying their bodies. So would tougher penalties for dangerous riding. Health insurance for jocks and their families? Not at the top of the list.

Life Insurance - Functions, Characteristics, Types, and Goals

Life Insurance - Functions, Characteristics, Types, and Goals - How Life Insurance Important? Does everyone need life insurance? the answer is: YES ...... is a must and should be soon. Do not be postponed. If we want to appreciate what is given by - his, people should keep trying. Because we will never know what will happen in the future, do the anticipation by having life insurance.
In choosing us to be observant and insurance tailored to our needs. There are Health Insurance, Accident Insurance, Insurance Education. There are so many choices, but the best option is already packed into one.

Lots going on a family must accept the bitter reality of life. The father as head of the family breadwinner at the same time to fall ill and died, leaving his wife that does not work and two small children. His son just turned 3 years and 5 years. Life remains to be served, but the wife would be very difficult to raise the cost of two children.

Keep your family from the above risks by having life insurance. If the family - at least his father - already have life insurance, would have been materially more ease the burden of the family left behind. Because it was in the hospital is certainly not cost you a bit. It could be to spend the assets owned.

That means if you already had life insurance can be said you already have Income Protection and already planning for the future of the family finances as per the agreement with life insurance policy issuer. You will definitely get the appropriate reimbursement claims from health data are given according to actual conditions. No health data engineering.

Financial planning is not something you do once and forget. Then there are many people who buy life insurance policies even more to 5, for the sake of a cherished family. To his wife and children. (Each family member can have an s / d 2 policy) Financial planning is a process for those who are single or not family. Never since his health was still good and have put off Life Insurance. The younger the age you are, the better to protect themselves immediately, have Protection and Investment Income for financial planning in the future.
The father must work hard at any time and anywhere. Continuous work sometimes forget to pay attention to health. Family for the sake of his wife and child - any child will do. But do not forget to place something on the father's health, its impact will be more difficult again. Can say it's useless in the work of many years, if the income results obtained have not set aside for self-protection.

See was the smile of children - children who need parents. They need life, to school, have cost if it gets sick.

Family life will always change and family financial planning should follow the changes in family finances. Force planning is supported by a wise investment. Investment in its most basic sense is, put your funds to get bigger results. Insured & making money investing is most important means of improving your ability to love, love their families and keep wealth.

With an account you have insurance, then you have insurance at the same time to INVEST in your future and family.

LIFE INSURANCE
Regulatory definition:
"The company is a life insurance company provide services in dealing with risks associated with the life or death an insured person "
Definitions applicable:
Life insurance is insurance that provides kinds financial transfer of losses for the disaster that can occur in humans

Functions of Life Insurance
• Media Protection
- Provide compensation to the heirs when the insured dies within period of coverage
• Media Investments
- Provide compensation to the heirs or the insured when the insured remains live up to a certain age or until the end coverage period.

Goals of Life Insurance
• Individual life assurance, usually an insurance policy This spirit can be issued in a particular value example, Rp 10 million or more with premiums paidis an annual, semester, quarter monthly AAU
• Group life assurance is life insurance usually issued without any medical examination on a group of people under one policy where each parent of the groups receiving certificates of participation
• Industrial life assurance, premiums are generally paid paid weekly at home has policy to agents

Unavoidable Realities of Insurance: Health Care Edition

Insurance markets are unavoidably unpopular, because of a basic fact and an unpalatable implication.

Here's the basic fact about all insurance markets: What gets paid out must equal what gets paid in. Or to put it another way, what is paid in by the average person in premiums must be pretty much equal (with some minor differences noted below) to what is received by the average person in benefits.

And here's the unpalatable implication: Some people will receive much more from insurance payments than they pay in. They might buy life insurance and die young, or buy car insurance and suffer a severe accident, or buy health insurance and face a costly period of hospitalization. But in turn, because of the basic fact that the average person can't receive more more in benefits than the average person pays in premiums, there will inevitably be many people--probably a majority of insurance buyers--who will receive much less in insurance benefits than they pay in.

For example, I'm a direct purchaser of insurance for my home, car , and (term) life, as well as an indirect purchaser of health and dental insurance through my employer. The best possible outcome for me is that I would pay premiums year after year, all my adult life, and never receive more than minimal insurance benefits. After all, receiving significant payments from an insurance company would mean that my family had experienced damage to our home, or a car accident, or sickness, injury, or death.

Any market where the good outcome experienced by a majority of buyers is to make payments all your life in exchange for little or no benefit is going to be continually unpopular. 

A lot of energy goes into trying to ignore or deny either the basic fact about insurance markets or the unpalatable implication. The expansions of what health insurance policies must cover that are required by the Affordable Care and Patient Protection Act offer a vivid example. The rules expanding what a typical health insurance plan must cover mean that the average person will need to pay higher premiums, because the benefits being paid out of the health insurance system need to equal what is paid in. Moreover, some people are going to draw on these additional coverage provisions much more than others, so many of those who are unlikely to draw upon such policies will find an even bigger gap between what they are paying in insurance and the insurance benefits they personally receive. Indeed, many of these all-pay, little-benefit households--and many people have a pretty good idea whether they fall into this category--are being required under the new law to pay for others to receive a level of health insurance coverage that they had not previously chosen to receive for themselves.

There will always be a political dynamic to promise that the majority should receive more for their insurance, but that no one should need to pay more on their premiums. For example, the original Medicare legislation back in 1966 required that premiums paid by the elderly should cover 50% of the costs of Part B. But Medicare spending went up, premiums didn't, and in 1997 a law needed to be passed to assure that premiums paid by the elderly would cover 25% of the costs of Part B.

Another way to quarrel with the basic fact about insurance is to point out that private insurance companies spend money on administrative costs and on profits. In addition, insurance companies earn revenue from investing reserves. One can argue that insurance companies could be more efficient, or their profits could be more regulated, and that in these ways benefits might be increased somewhat without paying more in premiums. I'm all for encouraging greater efficiency, and I think the government has been slow in pushing the private sector to coordinate on formats for electronic medical records and billing. But the National Association of Insurance Commissioners reports that in 2012, insurance companies spent 85.7% of the premiums they received, while 11.8% was paid in administrative expenses, and the other 2.7% was profit margin. In other words, the overwhelming amount of money paid into health insurance in premiums is indeed paid out to health care providers. The existence of private-sector insurance companies may bend the basic fact that what is paid out in insurance benefits must equal what is paid in, but it does not sever the connection. 

Just to be clear, neither the fundamental fact about insurance nor the unpalatable implication goes away with a government-run or a single-payer insurance system. Whether it's Medicare or Medicaid or private sector health insurance or government-run exchanges, it still  holds true that benefits must be paid for. It's tempting, of course, to assert that the U.S. government could run a nonprofit health care system in a efficient and cost-effective manner that reduced administrative costs, but even if this assert is true, as noted a moment ago the additional revenue from greater administrative efficiency is a modest share of total health care spending. Also, given events in recent weeks, that assertion that the U.S. government could run an efficient and cost-effective health insurance system must be open to considerable dispute. There's a reason why, in a country as large and diverse as the United States, insurance regulation has typically been done at the state level rather than the federal level. Even with a government-run or single-payer system, it still holds true that because some people will experience very high costs, the typical person will pay into the health insurance system more than they ever get out--and should be perversely grateful to be lucky in this way. 

I have for years favored having the government spend more to subsidize health insurance for those 50 million or so Americans who have lacked it. My preference has been to fund these subsidies by placing limits on the tax exemption given for employee compensation paid in the form of employer-paid health insurance. (For some estimates from the Congressional Budget Office of how such limits could raise $46-$101 billion per year in extra tax revenue when phased in 10 years from now.)

However, the Affordable Care and Patient Protection Act goes well beyond providing assistance to those without insurance. It has been promoted with set of promises that everyone in both the individual and employer-provided insurance market can have the same or more insurance coverage while everyone pays the same or lower private-sector insurance premiums--and while future increases in government health care spending are lower than than they otherwise would have been. In seeking to carry out these promises in defiance of the basic economics of insurance markets, the law will necessarily disrupt the health care arrangements for a sizable share of the 200 million or so Americans who already have private health insurance.