Page 68 - MEDICAL AND HEALTH INSURANCE
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MEDICAL AND HEALTH INSURANCE
of the refund, as the lifetime of the policy during that period is
proportional to the entire duration of that period.
Accordingly, it is also a good retention strategy to encourage good
policyholders to continue with the insurer and enjoy the experience refund
as it is used to offset the renewal premium.
3.2.6 CO-INSURANCE
Cost sharing or co-insurance in claims utilisation is being applied more
frequently now as a cost containment measure tor both, individual and
group PMI policies.
The Insurer normally shoulders a higher percentage of the co-insurance;
usually up to 80% while the Insured may be accountable for up to 20%.
However, other proportional percentages may also be applicable
depending on the product design. In such cases, the room and board is
fixed and not subject to co-insurance apportionment.
The other very popular co-insurance is the 'upgraded room & board co-
payment'. This condition is applicable for both individual and group PMI
policies.
Similar to excesses and deductibles, the application of co-payment has
been found to be effective in keeping a check on the claim cost, as
policyholders take more responsibility for their utilisation and making sure
that they are billed correctly for their utilisation.
3.2.7 BENEFIT LIMITS
The benefit limits of PMI policies vary among insurers. The higher the
benefits, the higher would be the premium priced.
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