There is still a lot of confusion surrounding a standard medical insurance and a critical illness policy among the public in the UAE, according to research commissioned by Friends Provident International (FPI) to examine life insurance trends in the country.
Health insurance is designed to cover medical expenses only, and will cover these expenses as they arise, the report noted. The amounts payable are strictly correlated with the cost of actual medical treatment. Health insurance does not usually provide for long-term recuperation, therapy or home-care services should they be required. On the other hand, the proceeds of critical illness insurance can be used in any way the policyholder chooses, depending on their particular circumstances.
Overall, the research showed that more people in the UAE are taking responsibility for protecting their family’s future. For example, compared with a year ago, the take up of critical illness insurance has increased by one third among the female population, and 24% of the 396 women surveyed claimed to have this cover in place, compared to 18% in 2016. The increase in take up of critical illness insurance among the male population is much lower and has grown by just one percentage point to 25% over the same period.
Mr Chris Divito, Managing Director for Middle East and Africa at FPI, said the results of the study are worrying because they show that many residents assume that their company-sponsored insurance is sufficient to pay the bill in full when they lose a leg or get stricken by cancer.
He added: “I am concerned they may be confusing their mandatory health insurance with critical illness insurance, which is not something typically provided by an employer as part of a benefits package. These are two completely different types of insurance, and these people may not be as well-protected as they might think.”
People should consider critical illness insurance as a vital addition to their mandatory health insurance – especially if they have a family who would be impacted financially if they became seriously ill, he said. “While health insurance will take care of medical bills in the short term and get you back on your feet, it will not replace earnings that may be lost as a result of a serious illness, any long-term care or any modifications that may be required to your home to help you cope with the ongoing impact of a serious illness.”
He advised that people should speak with a financial adviser to check if they are adequately protected in the event of serious illness or accident, adding that “an adviser will be able to discuss the options and if necessary arrange suitable cover”.
The survey, undertaken by YouGov, was conducted between 23 and 30 August 2017. M