When I would finally ring the company to ask how the claim was progressing, they would say ominously they 'were making further inquiries'. If you think that sounds like something the police might say when investigating a crime, you would be right. I felt the company was casting itself as a fearless investigator while I was the cunning criminal attempting to hoodwink them.

I was nothing of the sort. I was a fit and healthy individual who had paid a lot of money for insurance protection I clearly was not getting. Then the letters from the insurer started to arrive - both to my wife and I, and our doctors - asking for further details of our medical history. I quickly gathered what they were attempting to do: they were building a case against us using the favourite catch-all of the insurance industry - the 'pre-existing condition'.

If they could argue the expenses we were claiming involved a pre-existing condition, they would not be liable to pay. Every health insurance policy has clauses covering pre-existing conditions. I did not realise it at the time that the one I had signed meant every illness including a common cold could be interpreted as a pre-existing condition: if they could have blamed a current illness on something I had picked up in kindergarten, I am sure they would have.

Disaster then struck. My wife went into hospital for a major emergency operation totally out of the blue. The six-figure hospital bill would have bankrupted us if the insurer did not pay. After much hemming and hawing, they did agree to pay - but not before interrogating the doctor, who had to say there was no chance this was a pre-existing condition.

And there was a sting - the insurer immediately cancelled both my wife's and my policies, even though I had never made a claim personally. I got the impression that we had had the temerity to get sick - the type of person a health insurance company clearly does not want on its books.

That was three years ago. Since then we have had very minor medical expenses. If the insurer had been more reasonable, we would have still been customers and they would have retrieved in premiums the amount of claims made for the hospital visit. In fact, they would have been in the black. But that is not how some insurance companies appear to work in this town - they work on the premise that the customer is always wrong and is always out to get them.

I was so angry about our treatment at the hands of this particular insurance company that I wanted to make an official complaint. Unfortunately, in Hong Kong the closest thing to official is the Insurance Claims Complaints Panel. I looked it up, but was immediately downcast about the prospects of receiving a fair hearing.

True to Hong Kong's almost obsessive self-regulatory bent, the panel is run under the auspices of the Hong Kong Federation of Insurers' Insurance Claims Complaints Bureau. Hong Kong, unlike Australia and Britain, does not have an independent insurance ombudsman able to hear complaints. In other words, you are essentially complaining to the people you are complaining about.

With rising complaints about health insurance, this self-regulatory model is coming under increasing attack. Membership in the complaints panel appears to be heavily stacked in favour of business. It is chaired by a qualified legal practitioner but includes two officials from the insurance industry and a representative of the Hong Kong Institute of Certified Public Accountants. There is a lone member of the Consumer Council representing the general public.

Hongkongers are increasingly complaining long and loud to the panel. Complaints rose from 344 in 2005 to 518 last year. Health insurance is a big business in Hong Kong, especially after the Sars outbreak of 2003. According to Audrey Chan, chairperson of the Hong Kong Medical Insurance Association, there are up to 4 million policies in the city. Sixty per cent are covered under group schemes, with the remainder belonging to individual policy holders.

Of the complaints handled by the bureau last year, 31 per cent were about the application of policy terms, 20 per cent were disputes over exclusions and 17 per cent were about non-disclosure. There were also disputes over the amount of indemnity and breaches of warranty and policy conditions.

Were complainants successful? Judging from the outcomes, most would have said no. The panel ruled that there was 'no prima facie evidence' in more than half the cases and it upheld the insurer's decision in 14.5 per cent of complaints. A scant 2.4 per cent of decisions went in favour of the policy holders. There were mutual settlements in 14.5 per cent of cases and complaints were withdrawn in 15 per cent of cases.

Michael Tsui, a barrister and chairman of the panel, appears to be a man committed to giving everyone a fair hearing. But even he concedes the image of the panel is not totally transparent. Any change to make the panel a truly independent body would be up to the politicians, he adds.

'There is some perception that we lack independence because we are under the federation,' said Tsui, who as well as being a lawyer is a qualified orthodontist. 'At the moment, however, we are working as well as if we were totally independent.'

The chairman is nominated by the committee of the Insurance Claims Complaints Bureau (ICCB) and approved by the secretary for financial services and the treasury.

The other members of the panel are nominated by their respective organisations. Their nomination has to be approved by the general committee of the ICCB. Members do not receive any salary or remuneration.

So how does the panel go about its business? Tsui says the panel meets once a month, dealing with 20 to 30 cases in one morning. He says he only votes if there is a vote tied 2-2. While he says the insurance sector representatives usually vote together as a block, he claims there is no bias against policy holders. In fact, the panel tends to lean the policyholders' way, he says.

He also says the fact that so few cases appear to go in favour of claimants is misleading. Before any disputed claims are put to the panel, cases are referred to three so-called 'honorary secretaries' - who are other insurers - for assessment. If they decide the complainant has a case, they may recommend the insurer settles with the policy holder. Thus it is only the weakest cases in terms of the complainant's arguments that tend to go to the panel.

Tsui says the panel can look beyond the strict application of the policy terms and apply common sense to a case. The terms of the policy contract should prevail unless it would produce a result 'unfair and unreasonable' to the complainant. The panel's decision is binding on insurance companies, while complainants still have the right to sue in court.

But despite the best efforts of Tsui and his panel members to be fair, many in the community feel the panel lacks credibility and is in urgent need for reform.

The Hong Kong Consumer Council is one organisation backing the need for a more independent complaints mechanism, providing for more fair and transparent procedures. In 2003, during a government review of the sector, the council suggested the introduction of an independent insurance ombudsman or a financial ombudsman service. There were 'rising public expectations of a fair and timely mechanism for better consumer protection', the council had said.

An independent insurance authority was first mooted in 1993 but is still a pipe dream. The government has recently completed yet another report on the issue but a consultation period - which was initially planned in the first half of this year - is highly likely to miss a deadline this month.

The government cannot afford to tarry too long. The city's ageing population and rising medical costs mean health reform will be one of the biggest issues facing it in the years ahead. The government is now examining options for a universal health-care system.

In the meantime, consumers should tread warily when signing up for private insurance. As the consumer council notes: 'Medical insurance policies are as varied as they are complex - little wonder that many are unaware of the important provisions.'

As I found out to my cost, the small print is often so microscopic that even the closest of readings does not reveal the truth.