Excesses And How They Work | William Russell (2024)

The information on this page refers to health insurance policies starting in 2024.

What is an excess?

An excess is the amount of money you pay toward your medical treatment before your health insurance cover kicks in. With an excess on your policy, you must pay your eligible treatment costs up to the value of your excess.

Suppose the bill for your treatment US$3,000, and you have an excess of US$500 on your policy. This means you’ll pay US$500 toward your treatment costs, and we’ll pay US$2,500.

Excesses help us reduce our exposure to the cost of your medical treatment. In return, we pass the savings to you with premium discounts.

You select an excess when you apply for a health insurance policy. You can, of course, decline to have an excess at all. That means you’d contribute nothing to the cost of your medical treatment.

The larger your excess, however, the greater the discount on your premium. The largest excess we offer is US$10,000. Below, we’ll list out all our excess options and how they work in practice.

Expats from North America might be more familiar with the term ‘deductible’. Excesses are slightly different from deductibles, but they exist for similar reasons.

Why choose an excess?

Excesses are optional, meaning you can choose not to have one. This is known as choosing ‘nil excess’.

You might choose nil excess with your health insurance policy because you want certainty that you won’t need to contribute anything towards the cost of your medical treatment.

On the other hand, you might prefer an excess with your policy because the excess can help you reduce your premium. In fact, it’s one of our main levers for making health insurance more affordable (the others being choosing a cheaper plan or coverage zone).

The larger the excess, the greater the saving on your premium.

Most of our members choose an excess of US$250. This excess is big enough to give you a decent saving on your premium, but small enough that—when paying it for medical treatment—it won’t break the bank.

Who do I pay an excess to?

Who you pay your excess to depends on the type of medical treatment you’re receiving.

For outpatient treatment like doctor visits, you pay the bill yourself then claim back the eligible costs back from us. If your policy has an excess, we’ll deduct it from the money we pay you back.

(If you have cashless access to outpatient treatment on your policy, and you receive outpatient treatment at a clinic in our network, you’ll pay your excess directly to the clinic.)

For more serious medical treatment that requires your admission to hospital, we’ll usually settle your bills directly with the hospital. We’ll deduct your excess from the amount we settle. The hospital will ask you to pay your excess directly to them.

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What should I consider when choosing an excess?

We cannot recommend the right excess for you, but we can let you know some common strategies that our members use.

1/ A Bronze plan with a large excess

If you only want cover for serious medical conditions (e.g. cancer care, hospitalisation following an accident), then it’s likely you’re considering the Bronze plan.

With a Bronze plan, choosing a larger excess such as US$1,600 or US$5,000 might be a good option.

With a large excess, you’ll enjoy considerable savings on your premium. True, you won’t have cover for medical expenses that fall under these amounts. But treatment for serious medical conditions like cancer will likely cost ten times or even a hundred times the amount of your excess.

2/ A Silver plan with a small excess

If you’re considering a Silver plan, it’s likely you’re interested in cover for outpatient treatment such as doctor visits and pharmacy prescriptions.

While the cost of a doctor visit depends on where you live, it’s unlikely to cost more than a couple of hundred dollars.

If you choose a large excess such as US$800 or US$500, that doesn’t leave you much cover for your doctor visits.

That’s why members with a Silver plan typically choose a small excess or nil excess. The same is true for members choosing a SilverLite plan or a Gold plan.

3/ Make sure you can afford the excess

An excess is a great way to reduce your premium. But don’t forget: you’ll have to contribute the amount of your excess towards the cost of your medical treatment.

This might not be a problem if you choose a small excess. If you can afford an annual insurance premium of US$2,000, for example, then you can probably afford to pay the first US$50 of each claim.

But if you choose a large excess, such as US$10,000, you should make sure you can afford to pay the first US$10,000 or each claim. Your health insurance policy will not cover you for that amount.

What different types of excess are there?

There are three types of excess:

Nil excess

Deciding against an excess on your policy means you have ‘nil excess’. That means you contribute nothing towards the cost of your medical treatment.

It’s the simplest option, but it makes your premiums more expensive.

Per claim excess

A ‘per claim’ excess is the amount you’ll pay each time you make a new claim for a medical condition.

Let’s take the example of a torn ligament in your knee. You see a doctor, who refers you to a specialist. The specialist decides against surgery, but prescribes strong painkillers and a course of physiotherapy.

All your treatment relates to the same medical condition, so you pay your per claim excess once.

If—a few months later—you fracture your arm, and you need to visit the hospital emergency room for treatment, that would qualify as a new medical condition. You’d need to pay your ‘per claim’ excess again.

If you suffer a new occurrence of a medical condition (e.g. you tear your knee ligament again), we’ll treat that occurrence as a new claim, and you’ll need to pay the excess again.

If your course of treatment for a condition spans two policy years, you’ll need to pay the excess again when your policy renews.

Per annum excess

A ‘per annum’ excess is the maximum amount you’ll contribute towards your medical treatment in a single policy year. We’ll pay for your eligible treatment costs exceeding your per annum excess amount.

Let’s revisit the examples of a torn knee ligament and a fractured arm. If you suffer these conditions in the same policy year, you’ll only pay your per annum excess once.

When your policy renews, your excess resets and you’ll again pay your excess towards the cost of your eligible treatment in your new policy year.

Is there anything else I need to know?

We want to provide you with an insurance policy you can rely on, so it is important that you fully understand the scope of the cover we provide. Answers to the most common questions about insurance excess are here, but feel free to get in touch and speak to our award-winning team. We’d be glad to help.