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Monday, March 2, 2020

Coronavirus and Pre-Existing Condition in Health Insurance

Coronavirus and Pre-Existing Condition in Health Insurance

In general, health insurance is an insurance product (which in Indonesia can be managed by life insurance company and general insurance company) where this insurance product will provide compensation to the insured due to health problems experienced by the insured cause financial loss.

Evidence of the financial loss suffered by the insured above is that medical costs must be borne by the insured as a result of having to undergo treatment in the hospital, both in-patient and out-patient.

Pre-Existing Condition in Health Insurance

One of the rules that are usually regulated in a health insurance policy is a provision of health conditions that existed before the insured registered himself as an insured in health insurance. These pre-existing conditions will not be covered by the insurance company or health underwriter until a certain period of time after the insurance period runs effectively.

The occurrence of certain claims can be guaranteed from the beginning of the period on condition that the disease has recovered within a certain period before the insurance coverage period runs, for example, 1 (one) year before. For example, if you have been medically diagnosed with coronavirus (COVID-19) but were declared cured a year ago, then the insurance company can make a decision to accept the risk of this disease from the start of coverage or must go through a period of elimination or waiting period namely a period from the date of coverage starts until the date specified where the insurance participant has not been entitled to claim services for an event related to a particular disease if it has not passed the waiting period.

Why are these pre-existing conditions needed? This provision, among others, is made with the aim of avoiding the existence of anti-selection or adverse selection that may be carried out by individuals or groups of people where the purpose of buying insurance is only to obtain benefits or benefits for health problems that have been experienced previously. Imagine if all sufferers of the coronavirus (COVID-19) proposed an insurance application only because they already knew that they were suffering from the disease, then that meant he intended only to benefit from the presence of an anti-selection.

Indications of adverse selection occur because only the insureds know correctly about their health conditions while insurance companies lack or do not understand this condition well. Besides that, the insurance function will not run as it should if the insurer must accept a risk that has been and is being experienced by the participant. The insurable risk must meet the conditions of an uncertain event (fortuitous) that occurs during the period of coverage applies. This is also clearly stated in Law of Republic Indonesia Number 40 of 2014, "insurance is an agreement between two parties where the insurance company will provide compensation to the insured due to an uncertain event".

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