3 Insider Tips on Group Medical Insurance Renewal

3 Insider Tips on Group Medical Insurance Renewal

3 Insider Tips on Group Medical Insurance Renewal

blüüm
employee benefits
Jun 29, 2021
3 Insider Tips on Group Medical Insurance Renewal

If you already have an existing group medical insurance, it is always best to review your plan before the renewal date to ensure you have an optimised plan for employees. Here is a list of considerations to help you get prepared before the next renewal. 


1. Allow 2-3 months of preparation before your next renewal 

A window of 2-3 months is an ample amount of time to review the current group medical insurance plan and research for alternative insurers’ offerings. Your existing insurer is likely to give renewal notice 4-6 weeks beforehand, which leaves you little time for thorough consideration. It is therefore useful to set a calendar reminder for yourself.


There are 2 ways to understand feedback from employees. You can host a simple survey to ask about their experience. Key areas of interest usually include protection coverage, ease of accessing network doctors and claims application/processing. 


2. Why is the premium getting more expensive?

As the renewal of a group medical insurance plan involves creating a new contract between the insurer and the company, proposed changes in benefits and premium by the insurer are possible. It is helpful to understand the following factors that can lead to an increase in premium, in order for you to have a better assessment.

Rising global medical costs 

Premium increase will likely be due to the global inflation in healthcare benefit costs, which the projected average increase for Asia Pacific in 2021 is 8.5%. In 2022, it is also anticipated that factors such as increased utilisation due to deferred care during COVID-19 and increased spending in the health system in preparation for the next pandemic will drive up medical costs. Check out our free guide to learn more about trends in group medical insurance: Guide to Employee Wellness in SMEs 2021


New customer discounts in premium

Another possible reason would be the premium offered by your insurer in the first year was very competitive in order to acquire you as the new customer. The insurer may then need to increase the renewal premium in order to restore a profitable margin.


High claim ratio 

Insurer will review the historical claim ratio to determine the premium. For instance, if the claim ratio is relatively high in the past year (e.g. over 80%), then the insurer may propose an increased premium (or decreased benefit levels). In other words, the higher the claim ratio, the higher the new premium. 


Tailor-made plan versus Package plan

Group medical insurance plans on the market are largely categorised into Tailor-made plan and Package plan. If budget is an important decision factor for your company, then choosing a package plan will give better control to the premium. This is because premiums of tailor-made plans are defined based on the historical claim ratio of the company, causing more fluctuations in premiums. Benefits coverage and premium table of package plans are predefined by the insurer, hence you will find more stable premium levels over years.

Premium increase in group medical insurance


3. Purchase through insurance brokers or agents?

When you shop around to compare insurance plans, indeed insurance brokers can provide you quotations from different insurers. However, brokers do not represent your final choice of insurer and are less familiar with each insurer’s terms and policies, you will have a more difficult time managing your group medical insurance policy and the onboarding of employees on your own. The last thing that employers and HR managers want is the hassle and lack of after-sales support. 


blüüm is an insurance agency in Hong Kong, and we strive to provide the best dedicated services to SME teams in partnership with Generali Hong Kong, one of the leading international insurers in employee benefits. Our experienced consultants are happy to review your company’s existing group medical policy and situation, to give you transparent and professional advice. 


Click here to check out our SME group medical insurance plan or email us at info@bluum.hk for a free consultation call today. 

employee benefits
Jun 29, 2021
blüüm
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