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Understanding Medical Insurance

Tips on applying for insurance

1. Apply early

An applicant’s age, habits of smoking or heavy drinking, health condition and medical history are all important factors considered by insurers when underwriting a medical policy. Generally, a younger, healthier, non-smoking policy holder who is not a heavy drinker will enjoy a lower premium. Most policies have age limits for first-time applications and renewals. Normally, the maximum entry age is 65, while the maximum renewal age is 75 or even 100. This means that under normal circumstances, if the applicant has successfully taken out a policy before the age of 65, he/she will be able to renew the policy every year until the age of 75 or even 100. By contrast, if an applicant tries to take out a new policy after the age of 65, he/she may be unable to do so due to having exceeded the maximum entry age. If an applicant who is experiencing health issues tries to take out a new policy, the insurer may charge extra for the premium, impose exclusions, or even decline the application. In addition, note that even though renewal of some policies is allowed on an annual basis (i.e. policy holders are not required to submit an application every year), the premium may be adjusted annually according to the age of the policy holders as prescribed in the contract.

2. Consider your personal needs

There are a variety of medical insurance plans in the market, each with different coverage levels, benefit limits, modes of compensation, premium levels and deductible options. Consider your own protection needs and study the coverage of different plans in detail to find the product that best suits your needs. If you are already covered by group medical benefits, consider supplementing the group plan’s basic protection by adding an individual plan with deductible options, so that you can enjoy a better protection for a relatively low premium. For the different features of group and individual medical insurance plans, please refer to the section Common insurance classifications on this webpage.

3. Pay attention to excluded items

Most medical insurance policies contain a list of exclusions, such as preventive treatments, congenital diseases, and pre-existing conditions. Insurers will not compensate any expenses arising from these. It is important that you understand the meaning of the exclusions determined by your policy. For example, most policies define “pre-existing conditions” as any injury, illness, condition or symptom presented prior to the commencement of the policy whether or not it is congenital or acquired, and whether or not the condition has been diagnosed.

Nonetheless, coverage under the Voluntary Health Insurance Scheme (VHIS) extends to any “unknown pre-existing condition”, which refers to any health condition which existed but you were unaware of when you applied for the insurance coverage. All Certified Plans provide partial coverage for unknown pre-existing conditions in the second and third year after policy inception, at 25% and 50% respectively. Full coverage (i.e. 100%) is provided from the fourth year onwards. Furthermore, VHIS also covers congenital conditions which have manifested themselves or have been diagnosed from the age of eight onwards. The benefit limit for this coverage is gradually increased in line with the number of years since policy inception. For details, please visit the VHIS website.

4. Be aware of the waiting period

Most medical insurance policies have a “waiting period” clause to avoid incurring liability for any claims arising from a disease contracted before the application for the policy. Any diseases or symptoms occurring during a specific period after the commencement of the policy are excluded from the coverage. The duration of the waiting period varies across different policies and with regard to different diseases and medical conditions. Most policies have a 30-day waiting period after their commencement. Some policies can have a waiting period of up to six months or a year for specific diseases such as gynaecological diseases. The waiting period normally does not apply to claims relating to injuries, so the insured can be reimbursed for medical expenses arising from an injury that occurs within the waiting period. In addition, if you are planning to replace a policy with a new one, note that the waiting period will begin again from the commencement date of the new policy. As this can affect your medical protection, bear this carefully in mind if you are considering surrendering your existing policy.

5. Disclose your health history accurately

“Utmost good faith” is an important principle in insurance contracts. Under this principle, an applicant must actively and honestly disclose all critical information to the insurer. The insurer can then reasonably assess the risk based on the disclosed information. The applicant is obliged to declare his/her health conditions and medical history as these will affect the insurer’s underwriting decision. On the basis of any disclosed health conditions, the insurer will decide whether it will charge extra for the premium or impose exclusions, and whether or not it will accept the application. Violating the principle of utmost good faith means that the insurer is unable to underwrite fairly and reasonably. In such a case, the insurer may reject claims on the ground of non-disclosure or misrepresentation of material facts, whether or not the facts relate to the illness that generated the claim. To clearly specify the information that needs to be disclosed, the industry issued the Best Practice on Standardizing Underwriting Questionnaire for Individual Indemnity Hospital Insurance Plans. Insurers are encouraged to adopt a standardised underwriting questionnaire. For details, please visit the Hong Kong Federation of Insurers’ website.


The above information is for reference only. For the coverage, mode of compensation, benefit limit and premium levels of any specific medical insurance plan, please refer to the relevant policy terms.