Review of the South African Market for Hospital Cash Plan Insurance

A recent Review of the South African Market for Hospital Cash Plan (HCP) Insurance managed by Cenfri and commissioned by the FinMark Trust and conducted by Lighthouse Actuarial Consulting finds:  

  • There are estimated to be between 1 million and 1.5 million HCP policies in effect, with total lives covered estimated to be 2.4 million people
  • The majority of policyholders are in the LSM 4-7 brackets
  • More than 55% of HCP beneficiaries are concentrated between the ages of 20 - 40 years
  • There are between 30 and 40 insurers providing HCPs, versus 99 medical schemes and between 15 and 20 Gap cover providers
  • The market is relatively large and rapdily growing with an estimated 50,000 new policies sold every month 

Click here to download the full report

Click here to download the stakeholder presentation

The report analyses the effectiveness of Hospital Cash Plans in South Africa in meeting the cost of health care for low-income earners, as well as its impact on the current medical schemes offered in South Africa. The paper illustrates that hospital cash plans are able to offer some form of protection against both direct and indirect costs to low income (less than R6000 per moth) earners that make use of public facilities even at benefit levels as low as R500 or R1000 per day. In addition, it put forth that it is highly unlikely that the average hospital cash plan product offering in this market would be able to draw members away from medical schemes considering that the majority of HCP policyholders also have lower levels of cover (70% to 80% of the market are believed to fall below R 1000 per day).  

 

To help further promote the conclusions from the study, the FinMark Trust hosted a forum to present and discuss findings on the size, structure and general nature of the market for hospital cash plan insurance in South Africa. Some of the more specific findings were shared and included data on the ability of these products to assist policyholders to deal with both the direct and indirect costs and loss-of-income associated with a health event. 

Additional Info

  • Country: South Africa
  • Institution: FinMark Trust
  • Date Published: 2012
  • Document Type: Research Papers
 

Review of the South African Market for Hospital Cash Plan Insurance

A recent Review of the South African Market for Hospital Cash Plan (HCP) Insurance managed by Cenfri and commissioned by the FinMark Trust and conducted by Lighthouse Actuarial Consulting finds:  

  • There are estimated to be between 1 million and 1.5 million HCP policies in effect, with total lives covered estimated to be 2.4 million people
  • The majority of policyholders are in the LSM 4-7 brackets
  • More than 55% of HCP beneficiaries are concentrated between the ages of 20 - 40 years
  • There are between 30 and 40 insurers providing HCPs, versus 99 medical schemes and between 15 and 20 Gap cover providers
  • The market is relatively large and rapdily growing with an estimated 50,000 new policies sold every month 

Click here to download the full report

Click here to download the stakeholder presentation

The report analyses the effectiveness of Hospital Cash Plans in South Africa in meeting the cost of health care for low-income earners, as well as its impact on the current medical schemes offered in South Africa. The paper illustrates that hospital cash plans are able to offer some form of protection against both direct and indirect costs to low income (less than R6000 per moth) earners that make use of public facilities even at benefit levels as low as R500 or R1000 per day. In addition, it put forth that it is highly unlikely that the average hospital cash plan product offering in this market would be able to draw members away from medical schemes considering that the majority of HCP policyholders also have lower levels of cover (70% to 80% of the market are believed to fall below R 1000 per day).  

 

To help further promote the conclusions from the study, the FinMark Trust hosted a forum to present and discuss findings on the size, structure and general nature of the market for hospital cash plan insurance in South Africa. Some of the more specific findings were shared and included data on the ability of these products to assist policyholders to deal with both the direct and indirect costs and loss-of-income associated with a health event. 

Additional Info

  • Country: South Africa
  • Institution: FinMark Trust
  • Date Published: 2012
  • Document Type: Research Papers