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Q: I run a small business employing about 20 professionals, and am wondering how the changes in the law on health insurance are going to affect me. What are my responsibilities in relation to providing employee insurance and how do I choose the right policy?
A: If you employ expatriate workers in the UAE, changes in the law will surely impact your company's human resources (HR) policy and its finances.
Last year, the Health Authority-Abu Dhabi (HAAD) required that all employers must arrange for medical expenses cover for all expatriates and their families resident in Abu Dhabi. For low wage earners this is provided on a subsidised basis by Daman, the national health insurance company. For the higher income group any insurance firm permitted by HAAD can offer products in the emirate.
Dubai is in the process of introducing similar legislation, with implementation expected at some stage later this year.
However, at this point we do not know exactly what the rules will be. These changes will impact all employers of expatriate workers and it is important to understand the types of medical expenses cover available.
Medical insurance pro-viders also offer fairly standard generic types of cover. However, it is the options, exclusions and the details which vary so tremendously that only someone with specialist knowledge will be able to advise the most appropriate policy. What makes medical insurance more complex than motor is the diversity of the risks being covered and the benefits available.
An expatriate workforce differs in a multitude of ways: age, sex, nationality, type of job, medical history, salary, geographical dispersion, amount of international travel and status within the company.
Variety
As well as the risk (or the person) being covered, the actual benefits offered vary widely. These vary in terms of in which countries people can be treated, whether emergency cover alone is provided, whether chronic illnesses such as diabetes are covered and so forth. To add to this, there is a lot of variation of terminology used by different insurers. Given that there are dozens of providers, it all makes the manager's job an extremely difficult one. The last thing you want is to have employees thinking that you have arranged comprehensive cover, but when they file a claim they find they are not covered.
There are broadly speaking two types of geographical cover and two types of insurers. Cover is either regional which means that medical care can be provided only in certain countries such as the Middle East, Africa, South East Asia or the Indian subcontinent or a combination. Then there is international cover which will pay for treatment anywhere in the world.
Turning to the type of cover, many insurers offer standard plans which will pay for emergency treatment only. Then there are plans which will pay for emergency treatment as well as what is known as elective treatment, that is, where the client has chosen to receive medical treatment for a non-emergency condition. This is obviously more expensive.
In terms of what to look for, apart from geographical coverage, choice of company and required level of cover, you should also look at things like coinsurance, excess (or deduct-ibles) and, obviously, exclusions. Coinsurance is where the patient is required to pay a certain percentage of the costs, say 20 per cent. An excess is the fixed amount of a claim that the patient is responsible for. Choosing a higher excess will reduce your plan premiums.
Watch out for how previous medical history is treated. Some companies will exclude previous medical conditions altogether. Some operate what is known as a moratorium clause.
So how do you chose the best policy for you? You should seek help from a broker who has access to more than a handful of providers and it must be one that has specialist staff dealing in the area of medical expenses insurance.
- The writer is employee benefits manager at Nexus, a leading regional financial adviser.
The opinions expressed above are the writer's and don't necessarily represent the views of Gulf News.
Please send your questions to advice@gulfnews.com.
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