Hong Kong market is seriously underinsured

According to the statistics provided by some reinsurers, the total value of the underinsured market in Hong Kong is estimated to be at least HK$2 trillion. This figure would be even higher if medical, disability, critical illness and long-term care were also included. It is reckoned that only two out of every three Hong Kong people have life insurance. Despite the demand for protection increases over 25 per cent in each of the past 5 years, the underinsured market continues to increase. Real protection needs are being ignored.

Approximately 60 per cent of the Hong Kong population is not covered by any individual or group hospital plan but 40 per cent of these could afford to pay for such coverage. Why not start financial planning and acquire the suitable financial plans earlier, while you are still in good health condition? Plan ahead to enable an ideal retired life and ensure the expected protection is there when needed. Rather than putting all your accumulated wealth at risk, the relatively low cost of protection insurance is well worth to spend because you will have total peace of mind that your accumulated wealth will not be not eroded by health mishaps.

Impact from inflation should not be ignored

Inflation has also contributed to the increasing number of underinsured. The combination of medical inflation and salary inflation together were huge over the past three years.

In the market, there is the "Inflation Protector Option", which can be added onto your insurance plan. The protection face amount will be automatically increased at each of the first 10 anniversaries, with no evidence of insurability required. You may simply take this option at inception.

The breakthrough is that the "Inflation Protector Option" also applies to critical illness products. Its first-in-the-market critical illness product feature is a good option to safeguard against medical inflation. The sum insured of the critical illness plan will be automatically increased at each of the first 10 policy anniversaries, with no medical evidence required.

When purchasing critical illness products, you may consider the following features and coverage:

* Guaranteed renewal up to age 100 and level premium. – this means the premium will not increase with age, so the earlier you are insured, the less is the total premium charged. Additionally, when you reach the golden age of 100 or death, the sum you get equals the coverage of your policy.

* Providing second medical opinions. – you may have access to the top US hospitals for second medical opinions and best-in-class medical treatment at preferential prices. A second medical opinion reduces the risk of inappropriate treatment and offers patients additional peace of mind, increasing the chance of recovery.

* Comprehensive critical illness protection covers 48 major diseases, plus the gender-specific protection features that can release you and your family from your financial burden.

Increasing medical cost

Report shows that HK people have longer life expectancy. By 2033, one in four people will be aged 65 and over. If everyone retires at the age of 65, there is an expected retirement life of 20 (for males) or 25 years (for females).

Hong Kong government medical and senior welfare expenditure is increasing; therefore, less expensive prescription and higher hospital costs seem inevitable. The MPF, which was launched in 1999, requires you to wait 20-30 years for retirement. In addition, the protection may also be inadequate. Furthermore, at retirement, your daily living expenses will be mostly medical and the ratio is usually huge, making money reserves insufficient for daily living.

Choosing the right financial plans, with wealth accumulation and protection, is the ideal solution to continue to live long and live well.

To ensure your family can get comprehensive and sufficient coverage, please review your protection needs regularly to fight against inflation and enjoy the most comprehensive coverage at different life stages with changing needs.