This document discusses the scope and forms of healthcare insurance. It provides information on: - Healthcare insurance normally covers treatment of acute conditions but not chronic or preventative care. - The main forms of health insurance are medical insurance, personal accident/sickness, income protection, critical illness, and long-term care. - Healthcare policies can be personal, covering individuals and families, or group policies arranged by employers to cover employees. Group policies are typically paid for by the employer.

1. SCOPE OF HEALTHCARE INSURANCE
• Healthcare insurance cover varies from insurer to insurer.
• In Rwanda, Healthcare insurance is classified as general insurance business.
• Policies are issued with benefits guaranteed for a year in the same way as
motor or household insurance.
• At the end of each policy year, the cover stops.
• Members have to decide before this time whether they want to maintain
their cover for a further twelve months.
• This process is referred to as renewal. In practice, insurers usually offer
renewal terms although these could vary depending upon the experience
of the insured during the preceding policy period.

2. Scope of Health Care Insurance Cont..d
• Healthcare insurance normally covers the cost of treatment of acute conditions.
Acute conditions are those conditions that develop suddenly, have serious
symptoms and have a limited duration. Examples include appendicitis or
tonsillitis.
• It follows that healthcare insurance will normally not provide cover against long-
term or chronic conditions. Chronic conditions are those which develop slowly,
usually recur and last for a long time. This term is usually used to describe
conditions which, with current medical knowledge, treatment can alleviate but
not cure. Examples of these are allergies, asthma, eczema, arthritis and diabetes.
• Health insurance does not normally cover the cost of preventive medicine or
health check-ups (sometimes known as health screening). The practice may vary
from company to company.

3. Forms of Health Insurance
The main forms of health insurance are as follows:
• Medical Insurance;
• Personal accident and sickness insurance;
• Income protection insurance (IPI);
• Critical Illness Cover (CIC); and
• Long-term care insurance.
Medical Insurance
• Medical insurance covers the cost of medical treatment required by any person covered by the
policy. Policies are available to cover single lives, whole families of husband, wife and children.
• In Countries with a fully funded healthcare system, the insurance covers the cost of the following:

4. FORMS OF HEALTH INSURANCE
FORMS OF HEALTH INSURANCE
• The main forms of health insurance are as follows:
• Medical Insurance;
• Personal accident and sickness insurance;
• Income protection insurance (IPI);
• Critical Illness Cover (CIC); and
• Long-term care insurance.
MEDICAL INSURANCE
• Medical insurance covers the cost of medical treatment required by any person covered by the
policy. Policies are available to cover single lives, whole families of husband, wife and children.
• In Countries with a fully funded healthcare system, the insurance covers the cost of the following:

5. Medical Insurancet Cont..d
• Hospital Charges such as accommodation , operating theatre fees, surgical dressing and
consultations;
• Specialist fees such as surgeons and anaethetists fees;
• Additional costs such as ambulance fees and nursing.
In countries without a free national health service, the insurance may include general practitioner
consultancy.
In countries with a well-developed national healthcare service, medical insurance meets three main
needs:
• The need to receive speedy hospital treatment;
• The ability to choose one’s own hospital, surgeon and admission date; and
• The need to have better accommodation and greater privacy.
• In developing markets/countries, the quality of healthcare might encourage a broader
demographic to opt for medical insurance.

6. Personal and Group Medical Insurance Products
• The health insurance market may be divided into personal policies
and group policies. Individuals buy personal policies for their own
benefit and for their dependants. Group policies are bought mostly by
employers to provide medical care for their employees.
• Personal Healthcare Policies are usually available with different levels
of provision:
• Comprehensive;
• Standard;
• Budget (Low Cost);
• International

7. Comprehensive Policies
• Comprehensive policies provide the widest scope of cover to members. They are,
therefore, the most expensive.
• They cover all forms of medical costs in the hospital of the insured choice.
• They tend to be purchased by people in the higher socio-economic groups with a
large disposable income.
• They cover hospital charges such as accommodation and nursing, operating
theatre facilities, surgical drugs and dressing.
• They also cover specialist fees such as surgeons’ and anaesthetists’ fees for
surgical operations. Depending on the policy, cover may be provided for the full
cost of the operation or up to a financial limit stated in the policy. Surgical
procedures are usually classified according to their complexity and the time
involved for both the surgeon and the anaesthetist. The categories include the
following:Complex Major Operation, Major Plus, Major, Intermediate and Minor.

8. Comprehensive Policies Cont..d
• Outpatient benefits are also covered under comprehensive policies. The
most common types of out-patient treatment include the following:
• Routine outpatient consultation;
• Laboratory and Radiology Services;
• Prescribed Physiotherapy;
• Prescribed drugs and dressing;
• Dental Services;
• Optical Services;
• Routine Immunizations;
• Post- natal Care up to six weeks after delivery; and
• Ambulance Services;

9. Standard Policies
• Standard policies provide similar cover to comprehensive policies with
exception of certain benefits such as travel insurance and cash benefits.
Budget Policies
• These provide the basic medical need for hospital treatment and speed of
treatment. They do not offer a choice of hospitals and may exclude a
number of features such as outpatient treatment, ambulance costs and
home nursing. There may also be limits on the amount the policy will pay
in claims in any one year.

10. International Policies.
• Falling sick or getting injured abroad may turn out to be very costly.
International healthcare insurance policies seek to address this problem by
providing cover against the cost of medical treatment for other country
nationals working abroad.
In order to provide international cover, insurers arrange the following:
• Agreements with international hospitals to secure accommodation at
guaranteed rates;
• Facilities for settling claims in the local currency;
• Arrangements with medical practitioners around the world so that
members have access to qualified personnel in the majority of countries in
which they live and work.

11. International Policies Cont..d
• Another feature of international policies is that they give members
the option to purchase cover for the cost of emergency evacuation.
Emergency evacuation usually provides cover for the cost of the
following:
• Immediate transport anywhere in the world (usually to the patient’s
home country);
• A parent or guardian accompanying the child if the child is the
inpatient;
• A reasonable return fare to the member’s country of residence

12. Group Healthcare Insurance/Group Medical
Insurance
• Group healthcare insurance are for groups of individuals working for
the same employer or belonging to the same organization. Most
policies operate on a company paid basis, where the employer pays
the premium to cover all employees included in the medical
insurance scheme. Group healthcare insurance policies for employer
schemes may fall into any one of the three categories below:
• Small group schemes;
• Large group schemes; and
• Voluntary schemes.

13. Reasons for setting up a company paid healthcare
insurance policy.
• Healthcare insurance assists in budgeting for healthcare costs for
employees;
• It serves as a fringe benefit to encourage staff loyalty to the company;
• An employer can arrange for prompt treatment at a time that is convenient
to the employee and the employer;
• It can enable an employee return to work more quickly.
Small Group Schemes
• Small group schemes are generally schemes with members that are less
than 50. Premiums for these groups are paid or part paid by the employer.
To avoid selection against the insurer, company paid schemes are usually
paid group schemes are usually required to cover all employees, clearly
defined by age, employee status, grade and length of service.

14. Large Group Schemes
• Large group schemes are generally schemes with members that are more
than 50. In most cases, there is no exclusion for pre-existing conditions and
premiums are based on claims experience. As with small group schemes, to
avoid selection against the insurer through provision of cover for a
disproportionally large number of people that are already in ill health,
company paid large group schemes are usually required to cover all
employees, clearly defined by age, employee status, grade and length of
service.
• Premiums in respect of larger group schemes have traditionally been paid
in fully by the employer. Recently, however, as employers have sought to
reduce their costs in order to stay in business, some employees have been
asked to pay part of the annual premium.
• Family members can be added to the cover, enabling them to obtain
protection at a discount.

15. Voluntary Schemes.
• Voluntary schemes fall mid-way between individually paid healthcare
insurance and group schemes.
• Voluntary schemes exist where an employer or an organization or
association of which an individual is a member to offer healthcare
insurance but does not want to pay for the cover. Employees of the
employer or members of the organization/association take out and
pay for their own healthcare insurance policy but the scheme is
sponsored by the employer/organization and therefore a discount can
be offered to each member dependent on the size of the scheme and
or claims experience.

16. Benefit Structure of Group Healthcare Insurance
• The benefit structure for group healthcare insurance schemes is virtually
the same as it is for personal polices.
• The cover ranges from comprehensive to budget.
• Competition in the healthcare insurance market is very fierce and have left
insurers with very narrow profit margins.
• Insurers provide schemes tailor made to the individual client/company
requirements. Ultimately, the scale of benefits provided is determined by
the amount that the firm and or scheme members are willing to pay for
cover. The benefits to be provided are usually agreed upon with the
managing director or the financial director whose role is to handle all
premium payments and claims administration.

17. Supplementary Group Benefits
• A number of group schemes have included Employee Assistance
Programmes (EAP), sometimes known as employee support programmes
as part of the menu of benefits. An EAP provides employees with access to
confidential counselling service for a range of issues including:
• Debts and financial worries;
• Family and domestic difficulties;
• Mental and addictive illnesses; and
• Legal Advice.
• Any general concerns an employee may have about their health, lifestyle or
job.

18. Personal Accident and Sickness Policy
• As the name suggests, the sum insured is paid if the insured person suffers
an accident or is off- work due to sickness. The cover is usually on an
annual basis.
• The proposer occupation is the main rating factor. General practice is to
group occupations into several different rating categories and charging
premiums according to the level of accident/health risk involved.
• A personal accident and sickness policy is a benefit policy i.e a contract to
pay a sum of money in event of a certain contingency, irrespective of
whether or not the insured sustains a direct financial loss.
• Entitlement to benefit is limited by the ability to fund the applicable rate of
premium. This type of insurance is available as a stand-alone policy but
may also be purchased as add-on to travel, motor or household insurance.

19. Personal Accident and Sickness Policy
Cont..d
Accident Cover
• The accident cover provides compensation in event of accidental death or bodily
injury. Capital sum assured is paid in event of death or specified injuries. The
policy usually provides benefits of up to 104 weeks or compensation if the
insured is temporarily totally disabled due to an accident. Reduced weekly
benefits are available if the insured is temporarily partially disabled. In event of
permanent total disablement, a capital sum or an annuity is paid.
Sickness Cover
• The sickness section provides a weekly benefit of up to 104 weeks if the insured
is temporarily or totally disabled from engaging in their usual occupation due to
sickness or disease.
• The sickness policy is usually subject to a seven day franchise: if the insured is sick
for less than seven days, nothing is paid. But if sickness continues beyond seven
days, then the claim covers the entire sickness period.

20. Personal Accident and Sickness Policy
Cont..d
The benefits include the following:
• Death;
• Permanent Total Disablement;
• Permanent Partial Disablement;
• Temporary Partial Disablement;
• Temporary Total Disablement; and
• Medical Expenses.

21. INCOME PROTECTION INSURANCE (IPI)
• This is also known as Permanent Health Insurance. Income Protection
Insurance meets the needs of people who need replacement of
earnings lost due to long-term disabilities and whose financial
situation is that they do not require income replacement immediately
from when they are disabled.
• Income protection insurance replaces income lost through long-term
disability caused by sickness or accident. Income replacements do not
start until the insured person has been absent from work for a
defined period of time. This is known as the deferred period and its
length is chosen by the client when taking out the policy. The longer
the deferred period, the lower the premium.

22. Income Protection Insurance Cont..d
• The most suitable period for any individual is determined by the length of time
the insured’s employer continues to pay full or half-salary to the employees who
are too ill to work. If, for example, an employer pays full salary for the first six
months an employee is unable to work, it is possible to arrange a deferral of 26
weeks.
• Insurers commonly classify occupations into four categories as follows:
• Class One: Professional, Managerial, administrative and clerical workers;
• Class Two: Skilled, light Manual Workers in non-hazardous jobs such as shops,
garage, hotel and catering workers.
• Class Three: Skilled workers in non-hazardous manual jobs: butchers and
policemen; and
• Class Four: Skilled workers in hazardous jobs and heavy manual labourers.

23. CRITICAL ILLNESS COVER
• Critical Illness Cover (CIC) can be provided as a Stand- alone policy or
an option on term assurance, whole life or endowment policies.
• The benefit payable under critical illness cover is a lump-sum payable
upon diagnosis of one of several specified diseases listed in the policy.
The main aim is to meet the exceptional costs that the illness
produces.
• A wide variety of life threatening and permanently disabling
conditions can be covered.

24. Critical Illness Cover Cont..d
• The six basic critical illnesses are:
• Heart Attack;
• Stroke;
• Cancer;
• By-pass surgery for coronary artery disease;
• Major Organ Transplant; and
• Kidney Failure.

25. Long-term Care (LTC) Insurance
• The objective of long-term care insurance is to cover the costs of
caring for the elderly people who can no longer look after
themselves.
• When they are effected, LTC policies generally pay claims when the
insured is unable to carry out a number of activities of daily living
(ADL) without help.
• ADL include the following:

26. Long-term Care Insurance
• Washing and Bathing;
• Using the toilet;
• Dressing;
• Control of the Bladder;
• Mobility;
• Eating and Drinking
• Some companies provide benefits if the insured is unable to perform
two of these activities; some companies pay out on one, others pay
different percentages of the full benefit for different levels of
disability.