Prioritising the insurance of only our material objects putting our health at risk

16 January by Lifetime in Insurance, ACC, Health

Prioritising the insurance of only our material objects putting our health at risk

Financial adviser Lydia von Rönge challenges Kiwis to ditch their ‘she’ll be right’ attitude towards health and insure the one asset they can’t replace.

Prioritising the insurance of only our material objects putting our health at risk

Financial adviser Lydia von Rönge challenges Kiwis to ditch their ‘she’ll be right’ attitude towards health and insure the one asset they can’t replace.

I grew up in South Africa, a country in which once you leave home and get your first full-time job, your parents immediately ask: ‘Do you have your health insurance sorted?’

For me that question came at a time when all I wanted to do was buy a lounge suite with my first pay cheque. But, knowing that I had to prioritise my health, the furniture had to wait.

There is a public health sector in South Africa but it is chronically understaffed and underfunded, and the wait times are astronomical. This means we’ve learnt to adopt a culture where health insurance is just another one of those protections you need.

If I’m going to insure my belongings – my car, my contents, my house – then why wouldn’t I protect my biggest assets – my health and therefore my ability to earn an income?

When my mother was 62 she was diagnosed with aggressive, stage four colon cancer. Thanks to treatment she received through private medical insurance, she lived a further 20 months – invaluable time she got to spend with friends and family. We were told she would have only lived six weeks without that immediate treatment.

Here in New Zealand the Ministry of Health’s target for is “90% of patients [to] receive their first cancer treatment (or other management) within 62 days of being referred with a high suspicion of cancer and a need to be seen within two weeks”. However, the Ministry also states that: “cancer is a leading cause of morbidity and mortality in New Zealand, accounting for nearly one third of all deaths”*.

The country’s various district health boards strive towards this target. The latest national Q4 performance data from April-June 2017 was, however, 81 percent, down -0.4**.

What if you fall outside of the Ministry of Health targets?

This is not a criticism of New Zealand’s health service, but rather a reality check to consider your needs if the day comes when you need the public health system for treatment. It could mean you are waiting a number of months to receive it. 

Thankfully, the culture is shifting in New Zealand and more people treat their health and that of their loved ones as their own responsibility. More New Zealanders like having better control over their health and wellbeing choices.

Not only does health insurance mean you can see a doctor or specialist faster, and so start receiving treatment quicker, often it also gives access to medicines that aren’t yet on the government-funded list.

Medsafe is the authority in New Zealand responsible for the regulation on medicines in New Zealand, ensuring they are safe for use (and thereby allowing them to be used legally). Pharmac is the government agency that decides which pharmaceuticals to publicly fund; either fully funded or subsidise. While Pharmac covers the cost of many medications (around a third of Medsafe approved drugs), there are still a significant number which are not funded and many of these can be life-saving and expensive. With some private health insurance, those drugs would be available to you.

A friend of one of my clients has recently re-mortgaged his farm so he can go to Australia and receive a specific melanoma treatment that was not available in New Zealand yet. The financial stress and worry from that decision can put unnecessary pressure on his family and risk his health further.

Choosing your facility, doctor and treatment

The aspect of private health insurance that always resonates most with people is being in control.

Those suffering from an illness, with many health insurance policies, can ask for second and third opinions and demand access to the top-shelf drug treatments, even if that is overseas. The point is they don’t have to just lie back and accept what the public health system is giving them – subsidised drugs, one doctor and one opinion and a period of uncertainty through long wait times.

There are things to watch out for though – not all health insurance policies are created equal. Knowing your policy is just as important as taking it out. Many New Zealanders take out basic cover that reimburses them for visits to the doctor, which can cost around $50. However, this doesn’t cover the ‘big-ticket’ items such as specialist, surgical or non-surgical treatments that can cost up to thousands of dollars. Again though, it’s about choice. There are very good, affordable private health insurance available for Kiwis.

Don’t assume ACC will look after the problem

ACC is another Kiwi security net that is often misinterpreted – ACC only covers to a specific level for injuries and accidents – not illness. According to insurance claim statistics, two thirds of all claims are illness related which means that for the majority of incidents you’re not protected for treatment by ACC.

An Insurance Council of NZ survey reveals that 98 percent of home owners and 95 percent of car owners are insured, but despite this only one in five Kiwis are insured against sickness or disability. In a world where we pay hundreds of dollars every year to insure our cars and our contents, which in a second can be repaired or replaced, shouldn’t we be as readily insuring our own health and wellbeing, of which we only get one?

Added to this, what we often don’t anticipate are the extra expenses that come with illness. If you’re unable to work and have limited mobility or energy, you may need to pay for house or childcare assistance – increasing your monthly expenses dramatically. At the most extreme end of the scale, an illness has the power to wipe out your savings and place you in debt.

Today, good health is the one priceless asset we have. It pays to take care of it.

*Ministry of Health – Health targets: Faster cancer treatment
**Ministry of Health – Health targets – 2016/17 quarter 4 – results summary.

Article by Lydia von Rönge - Get In Touch

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