Beware of 'traps' in medical insurance coverage, watchdog warns

PUBLISHED : Wednesday, 16 July, 2014, 4:15am
UPDATED : Wednesday, 16 July, 2014, 9:27am

The consumer watchdog has warned holders of medical insurance policies to be wary of traps arising from the issuing of incomplete or opaque statements by insurers.

The warning came after complaints to the Consumer Council about insurance services rose to 195 in the first six months of the year - a 30 per cent increase from the same period last year.

In one complaint cited by the council yesterday, a patient with severely obstructed coronary arteries who required immediate angioplasty was denied indemnity by his insurer. The insurer claimed that, although surgery for coronary artery disease was covered, angioplasty - which involves using a balloon to enlarge blocked arteries - was a non-surgical technique and excluded.

In another case, a complainant was denied two-day coverage for an overnight stay at a hospital after being told by his insurer that a two-day "hospital confinement" meant being at the hospital for not less than 48 hours.

"I'm sure very few consumers would realise there is a difference between being hospitalised for two days and being confined in the hospital for two days," Professor Michael Hui King-man, chairman of the council's publicity and community relations committee, said.

Hui added: "Insurers have the responsibility to provide timely, frank non-misleading information when selling policies to customers."

He urged consumers to read insurance polices carefully before signing and to make use of any cooling-off period. They were also urged to disclose all personal and family medical history and information.

The industry is under scrutiny as the Food and Health Bureau prepares to table a reform proposal under which all private medical policies will have to meet a minimum set of requirements.

A regulatory body will be put in place to supervise the scheme, which aims to persuade more people to use private hospitals instead of the overburdened public health care system.

Council chief executive Gilly Wong Fung-han said insurance policies were one of the few products not covered by the extended Trade Description Ordinance, which was introduced last year to prohibit misleading practices for the sale of both goods and services. But they were still regulated by the Insurance Companies Ordinance, which banned any misleading practice that would lead to someone signing a contract.

Insurance-sector lawmaker Chan Kin-por agreed medical insurance should be reformed, but said the government should not set minimum requirements for policies as it would violate the principles of the free market.

Patients' Rights Association spokesman Tim Pang Hung-cheong supported the requirements but worried that the proposed price of HK$15,000 a year for a standard insurance package might be too high.