The Case for Medical Insurance

Recently I was undertaking some research in support of my belief that every family in New Zealand needs to consider medical Insurance as a cornerstone of their risk management plan.

The data I obtained from AIA Insurance validated my belief.

• People over 65 comprise 12% of the population but consume 40% of health spending.

• By 2051 the proportion of the population over 65 is estimated to double with the share of the total health spending increasing to 63%.

In my opinion, Government health spending will increasingly need to be “rationed” in the future. The focus will be increasingly on acute services and those most in need. Threshold levels for elective surgery will inevitably increase.

Elective surgery and diagnostic services not identified as an emergency and not life threatening will be prioritised within the Public Health System; notwithstanding the fact that it can improve a person’s health and quality of life.

In many situations diagnostic procedures are essential before a decision can be made to proceed with surgery, and there can often be delays in obtaining these diagnostic services through the public hospital services.

Elective services include hip and knee replacement, heart surgery, hysterectomy, cataract removal, cancerous tumor removal and diagnostic services such as endoscopy, laparoscopy, colonoscopy and MRI scans. While these services will continue to be provided by the public health system, they are increasingly becoming the domain of the private medical health industry.

See the chart below for indicative costs of surgery.

Your choices for ensuring health well-being and a better quality of life include the following:

1. The Public Health care waiting list.
2. Your own cash resources.
3. A Medical Insurance plan.

Medical insurance policies should be applied for while you are young and / or healthy. It is important to arrange the best and most comprehensive policy with a company that has the capacity to meet its claims obligations while you are healthy and able to.

Once you have a pre-existing condition, this is likely to be excluded from any insurance coverage as it is then deemed a “known” problem.

If you do not own medical insurance or if you have not reviewed your covers within the past three years call me on 021 240 4540 or email