The cost of living keeps rising and in the year ahead we can expect more increases that will put pressure on our hard-earned and diligently saved resources. This doesn’t have to be bad news – it can encourage us to improve and tailor our financial planning to meet the changes and test our flexibility! That means going back to your costs and determining what is necessary and what is not.

When it comes to your financial planning portfolio – you might see that you have Medical Aid and you have Dread Disease cover (also known as critical illness insurance) and feel like having the two is an over-spend.

The reality is: it’s not. Because they are not the same type of product.

In short – you can loosely view it like this: medical plans cover the direct medical costs of your illness (hospital, doctors and treatments) whilst dread disease/severe illness cover assists with everything outside of the traditional medical sphere (extra medications that aren’t covered, extra specialist visits, alternate dietary needs, medical equipment, car modifications to cars, time off work etc).

In short – they are complementary products.

Another quick point to consider is that the younger you are when you take on cover like this, the lower your premiums are. Age of commencement and time covered play a role when your premiums are calculated. General practice advises to start with a small amount of cover and build it up with time, this way it allows you to work towards the levels of cover you would prefer. But everyone is unique, so it’s best for us to chat about it first!

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Motor vehicle accidents are typically cited as the reason that young people need disability or income protection cover, but cancer was a greater cause accounting for 12.3% of claims (motor vehicles accounted for 11.9%). Even more worrying is the fact that in young parents, cancer was the cause for claim for 22.5%.

These statistics are for claims on policies that provide cover for death, disability or dread disease (illnesses such as cancer, strokes and heart attacks). The fact that many people now survive cancer means that most of the claims were paid as a result of severe illness and not as a result of the life assured dying.

Liberty’s claims-payments for severe illness cover increased by 50% from 2014 to 2015. This was not only due to the fact that more people are taking out this cover, but also because of the growth of awareness and early detection of cancer.

Liberty was not alone in their findings. Sanlam’s claims-statistics for 2015 show that 60% of its dread-disease claims were for cancer. At Momentum, 34% of its dread-disease claims were for cancer. At Discovery they were 38%. And at Old Mutual, 57%

An interesting statistic put out by Old Mutual with its claims figures is that 60% of all claims were for people under 45.

You may ask yourself why, if you already have medical scheme cover and loss-of-income cover, do you also need severe illness cover for cancer?

A medical scheme offers crucial cover that you shouldn’t be without. The problem is that cancer treatments are expensive and schemes have rules about what they do and do not pay for. Sometimes a doctor will recommend the best treatment available but a scheme only pays for a more modest treatment or there is a diagnosis of a rare form of cancer that requires specialised treatment.

These statistics show that cancer is still a widespread affliction, even at younger ages. While cancer claims are obviously higher among older age groups, even 20- and 30- somethings should be prudent when it comes to taking out risk policies.

If you have any questions or want to review your policies then give me a call and let’s meet up.

Source: iol

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Having come from a generation that largely understood medical cover as a ‘covers all’ policy, I’ve highlighted five more facts about hospital plans that are overlooked until they are needed! Some are comforting to know that they’re in place, others require being armed with the correct information.

1. If you find yourself in a crisis, the hospital will contact your scheme to arrange admittance.

2. Hospital plans can pay for hospitalisation in private hospitals, although some specify the use of network or state hospitals. Usually, schemes have agreed rates with specific hospital groups and your hospital bill and in-hospital medication will most likely be paid in full, depending on the specifics of the plan you have chosen.

3. Private doctors and specialists in private hospitals can charge up to three times the rate that the hospital plan will pay, be prepared to make co-payments (even people on full medical schemes can find themselves in this position). You can always check with your hospital plan administrators for available avenues to reduce costs. Always go with the designated service provider/network hospital if there is one, your bill could be completely covered!

4. Consider taking out gap cover if you want to prevent making co-payments on your hospital bill yourself. It consists of a small monthly payment that could reduce some unnecessary pressure in the future.

5. Hospital plans usually cap the annual maximum hospital bill they will cover per family. Cases that exceed the specified costs will be closely monitored.

Hospital plans generally cost less than half of what full medical insurance would cost you and they are strictly regulated. Always read the small print so that you know exactly what you are covered for. I’d be happy to run through these with you and answer any questions you might have!

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Having come from a generation that largely understood medical cover as a ‘covers all’ policy, it’s important to run through these five facts about hospital plans that are overlooked until they are needed!

1. You usually need to be hospitalised for the hospital cover to kick in. This does not include visits to the trauma unit, unless the doctor decides to admit you to the hospital.

2. Hospital plans are great for people who are fit and healthy and thus need minimal cover. Visits to doctors, dentists and optometrists will have to be paid by you. If your medical needs change, you can always select another option regarding your level of cover (usually in December).

3. Hospital plans need to cover you for 26 prescribed chronic conditions, such as hypertension. This means that the medication for your chronic condition is paid for by the plan. This is done to try and prevent hospitalisation. Prevention is better than cure.

4. Some hospital plans pay for certain procedures that allow for early diagnosis. Colonoscopies, mammograms and pap smears are examples of procedures that can be covered if done in doctors’ surgeries.

5. Designated pharmacies, ambulance and other services recommended by your hospital plan will likely be a lot cheaper.

In order to ensure that your portfolio matures with you, it’s essential that you are kept up to date with your policies and the way in which your portfolio has been designed. If you’d like an update – then let’s hook up!

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Last year I shared an article on my blog that spoke to the stark reality of the tragic impact that cancer has had (and continues to have) on almost every family in South Africa. It’s very rare, in fact, to meet someone who hasn’t either had cancer themselves, or has a close family member who has been diagnosed with some form of cancer.

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