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Today we’re asking two questions:

  1. Is medical gap cover a waste of money?
  2. Is Zestlife just out there to take your money?

Before we answer those questions, here are three things we hate about medical care in South Africa:

  • Spending thousands of Rands a year on medical aid when we seldom claim
  • The thought of having to pay a penalty if I’m a late joiner, but not getting a discount if I never claim, and
  • Having to a pay a gap cover company to do what my medical aid is not doing.

So could the money you spend on gap cover be better spent elsewhere?

Well think about this for a moment:

Why would the biggest open medical scheme in South Africa launch their own gap cover product? For that matter, all the major medical schemes offer some form of gap cover product?

We’re about to share with you a behind the scenes look at what goes on at Zestlife. Hopefully this will persuade you as to why you need medical gap cover. Now on to the second question:

Is Zestlife just there to take your money?

Look, I hate being ripped off as much as you do. There’s nothing worse than paying for something and then listening to “um’s and ah’s” when it comes to your claim. So if I’m going to recommend a company like Zestlife, then I’d like to know a little about their claims history. Only fair, right?

One thing we need to understand about medical gap cover is the fact that they can’t perform the function of a medical scheme. So if your medical aid doesn’t pay for a procedure in terms of their rules, then the gap cover company cannot pay for that procedure either.

Now on to Zestlife and their 2016 claims

So what were the most common claims paid?

Scopes, can you believe it?

In 2016 they paid for 3, 539 different procedures. Here are the most common:

  • Scopes
  • Cataract removal
  • Childbirth (both natural and caesarean section)
  • Dental extraction (wisdom teeth)
  • Arthroscopic (Bones and joints)

What was the largest claim they paid and for which procedure?

R134, 934 was paid for a scoliosis procedure in March 2016. Scoliosis has to do with a curved spine. How many of us have the spare cash lying around to settle a claim of this size? A 5 year loan at 12% interest would mean repayments of R3, 000 a month. Add to that your ongoing medical aid contributions, and we’re talking a ton of money here.

So what kind of shortfalls did they experience for various procedures?

Let’s look at some of the more common procedures:

  • So you’re about to have a caesarean section? The average shortfall per claim was R9, 892
  • What about tonsillitis? The average claim was R3, 223.
  • Bronchitis? R2, 144 per claim
  • Heart disease? R48, 725
  • Arthritis? R18, 455
  • Benign tumours – R26, 684
  • Knee replacement – R21, 489
  • And here’s the kicker – malignant neoplasm had an average claim of R26, 292 with several claims in excess of R100, 000.

And now the shocker with co-payments

In 2016 Zestlife paid 3, 422 co-payments totalling close to R9 million.

The average co-payment was around R2, 545 and the biggest clocked in at R13, 850.

What about hip and knee joint replacements?

Zestlife pays 20% of this shortfall. The average amount paid is around R11, 000 but they have paid as much as R48, 376.

What does this tell us?

So if we look at the statistics, it seems that two types of people should have medical gap cover:

  • Older people (if we look at heart conditions and joint replacements), and
  • Couples looking at having children

It also tells us that Zestlife is in the business of paying valid claims, and personally I’m thankful that there are companies willing to pay the shortfall. What would we do without them?

And here’s something else I thought about.

Take your car and home insurance company for instance.

Too many claims and they either increase your cost or they ask you to take your business elsewhere. A cellphone lost here and a small bumper bashing there – it all adds up.

But with gap cover it’s different.

You doctor recommends a procedure. Your medical aid authorises the procedure, and your gap cover picks up the shortfall up to a limit. There’s absolutely no reason for them to decline your claim unless:

  • you failed to disclose all information at application stage,
  • You’re still in a waiting period, or
  • The procedure was not paid for in terms of your medical aid rules

So that said…

If you don’t have medical gap cover right now – and you’re a member of a medical aid – then you should consider it. If there’s one recommendation we can make,  it’s medical gap cover, and here’s the thing, you never know when you’ll need it.

Until next time.

The InsuranceFundi team