In addition to Bupa's April 1st premium adjustments for their Premier Worldwide Health Option plan (PWHO), which caters to the China market, the leading health insurance provider has also announced major changes to their child coverage.
Some of these changes have left Globalsurance parents with Bupa plans feeling concerned. Children have typically been separated into two brackets based on age, a 0-6 bracket and a 7-20 bracket. Children that fall into the first bracket are likely to see premium increases of about 25-50%, while children in the older bracket will only see premium increases of around 6%. The result of this decision now makes it more costly to insure a child that is under the age of 6 than one in the 7 to 20 age range.
This premium increase varies across Bupa's range of modules and the different deductibles available with their PWHO plan. For example, the "WMI" inpatient only module will see an increase of about 32% across all deductible levels whereas on the "WMP" outpatient consultation module, the increase for children is about 37% on a nil excess.
These figures may be higher than expected for annual premium increases, but were overshadowed by the 50% increase for policyholders of the $170 excess option. In addition to these coverage increases, premiums for the dental and wellbeing and medicine modules have increased by about 25% for the young children age bracket. These increases are contrasted with the 6.1% increase in premium costs that were seen in the older child age bracket and adults across all categories and deductible levels.
Many will be undoubtedly surprised with the drastic cost increases to young child coverage, but the adjustments to child coverage demonstrates the company's commitment to focusing on providing the best coverage for their clients. While child insurance has shown increasingly high levels of usage in China, Bupa has made it a point not to skimp on their services, resulting in the need to increase premiums to remain competitive.
Although premiums for the younger age bracket may have increased, when a child reaches age 7 or older, their premium will go back down to a lower figure, a fact that should provide some solace to concerned parents. The high costs to insure young children, however, may prompt parents to question whether or not the costs associated with insuring their young children will be justified for the benefits that they receive.
One reason that this announcement has sent shock waves through the insurance industry and Bupa customers is that these increases and figures for young children are very high when compared to the other premium increases the provider has issued. Bupa prides itself on being a company that maintains stable premium increases and as a leader in providing some of the best in international insurance.
Drastic changes and increases are not very common for Bupa. Even though the company has a long and successful history as a top player in the health insurance industry, Bupa is still new in discovering and adjusting its offerings to the China market. It has only been about two years since the company launched their China-specific products and Globalsurance analysts suggest that they are still adjusting to the different insurance climate that exists in this new market.
Child coverage continues to be a hot topic in the Chinese market and many insurers are still deciding the best way to offer this controversial form of insurance. Some international insurance providers have limited offerings for children's coverage in China compared to other countries. For example, Now Health offers coverage for children separate from adult coverage but only for plans that have been processed in China. On the other hand, Interglobal offers children coverage separate from adult coverage on plans processed outside of China. Insurers which are new to the China market, face many challenges, including the daunting task of educating and helping the market understand the value of the product and to understand that not all insurers provide the same product.
Although the news of the unexpected increases may have concerned Bupa's customers, the company is still committed to exploring their options in the country. Furthermore, Bupa has expressed their hopes of making sure that their premiums and the ensuing adjustments are made accurately and within a steady pace of increase. Globalsurance analysts are confident that future changes to the young children age bracket will not be as significant as what has been seen with this years adjustment and increase.