An Overview Of Health Insurance in South Africa

The Insurance industry in South Africa is an ever-increasing industry, with new insurance companies appearing all the time, even other business have now jumped on the band wagon to offer insurance such as major food chains. Amongst all the different types of insurances that one finds here, such as car, household, life, travel and a myriad of others, I want to particularly speak about health insurance in South Africa and what the current state and trends are at this moment.

A larger percentage of the South African population is underprivileged or are in the lower income bracket with a leaser percentage of the population in the middle to higher income brackets. As a result many people have to rely on the public health care system, which is over-used and under-financed. Because of a lack of funding and inadequate services many middle to higher income earners have to take out private health insurance from private companies. The private health care system is ever increasing as more and more people come to rely on it, a total of 18 percent of the population rely on medical aid schemes.

South Africa has had major challenges in the health care sector over the past decade with sharply rising medical costs. As a result insurance providers had to get crafty by creating insurance schemes that could be afforded by the general public. Medical aid schemes have been on the increase too with major health insurer being Discovery Health with 1.5 million members. As I mentioned before there are many insurers offering medical insurance and medical aid schemes in South Africa and it is important to shop around and look for one that suits your needs. It is also very important that you read ALL the fine print, as many health insurance providers will do anything to not have to settle a claim, this goes for insurance providers in South Africa and the rest of the world.

South Africa is also seeing an increase in interest from foreign insurance companies, offering normal cover for all and also some special policies for expatriates. These special policies can include transporting the deceased via aeroplane back to their home country. The cost of international insurance cover can vary quite a lot depending on the type of cover and the age of the insured.

The future of the health care system in South Africa is uncertain. Government has proposed a new National Health Insurance (NHI), which will provide free medical care for all, although some sceptics say that Government’s ambitious health care plans are likely to fail. Government hopes to implement the plan in 2012, starting with the rural areas, and then gradually roll over to the rest of the country over 14 years. A sceptic says that for a NSI to work you would need at least 10 million tax payers and that South Africa only has about 5 million. South Africa with a population of 49.9 million in international terms has the smallest tax payer base.

South Africa seems to still have a long way to go before the health insurance industry and health industry on a whole is balanced to benefit all who need health care. If the sceptics are right then it seems that the private health insurance sector will still be growing in the near future.

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