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South Africa is in a technical recession and we’re all feeling it.

You don’t need a PhD in Economics to get the sense that this isn’t good news for the average South African who is already struggling to make ends meet. Hold up your hand if you are feeling the pinch? The knock-on effect of all of this is that even fewer people can afford the type of insurance cover they really need. A sluggish economy means fewer job opportunities, and that means less money lying around for insurance and savings.

At InsuranceFundi we have a gripe.

If you can’t afford to join a private medical scheme which costs around R1,000/month for a main member nowadays (and that would be an entry level plan), you are left with two options.

  • Take your chances in a State facilities
  • Look at cheaper alternative health insurance options

Let’s start with the State facilities first.

Most of them are bankrupt & so understaffed that finding yourself in a State hospital bed might well be a death sentence. The irony is that while Government is trying to push hard for the roll-out of its National Health Insurance (NHI), its hospitals are so poorly managed and corruption and tender irregularities are so rife. You have a sense that if you funneled billions of additional taxpayers’ money into a leaky bucket, the water would just continue to spill out into pools being lapped up by greedy politicians.

What is the point of rolling out NHI when the system is already failing?

For many South Africans a cheaper health insurance plan is something that does fit into their budgets. They don’t have the finances to join expensive medical aid schemes, but being completely reliant on the State also seems like a risk they aren’t willing to take.

Enter the health insurance policy space.

Insurers in South Africa have addressed a need in the market. The need is obvious, and it makes sense to offer someone a hospital-cash-back policy at R150 a month than it does to provide them with no solution at all, right?

What we can’t understand is why these insurers (who are offering great products to SA citizens) have been under so much pressure from the “powers that be”.

Someone has been trying to undermine medical gap cover and health insurance policies. Someone has been trying to bully them into submission over the last couple of years.

Who would have the most to lose?

Perhaps the medical aid schemes.

Perhaps some of them might have been chatting to the “powers that be” about the risk they faced in membership losses if smart underwriters and insurers decided to plug a hole in the market and offer affordable solutions.

We don’t know for sure, but what we do believe is the following:

South Africans are getting poorer with less access to private healthcare. For many of them R200 is about as much as they can afford to contribute to healthcare premiums.

Rather than the trying to force the hand of insurers, looking to provide honest solutions to these people, Government and the “powers that be” should back off.

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