Lmg Pacific Healthcare Increases Premium Because Of Last Year Claims

[yeti]

Me and my family have been insured with LMG Pacific Healthcare for few years. Policy renewal is due next month.

For me, they offer a 5% no claim bonus discount, as I have not been sick last year, this represents 536 THB.

My wife and daughter are on the same policy. My daughter has been sick several times last year, my wife not even once. For both of them the premium has been increased 10% because my daughter claimed benefits several times last year. This increase totals 2045 THB.

I guess this is covered by the terms and conditions which states "the Company reserves the right to adjust the insurance premium to reflect the risk and age of the covered person".

At first I was thinking this only meant that their premiums vary according to age, but I guess it could also cover the premium increase for covered persons who have been sicked previously...

I find this despicable, especially as they increased my wife premium even though she never claimed any benefit (she has never been sick in the few years she was insured).

Are other insurance companies practicing the same premium adjustments?

[jingjingna]

I know that most insurance premiums increase according to the age brackets set by the company. Could it just be the case that she has crossed over one age bracket to another?

If not, then shop around and see what other companies have to offer.

[yeti]

My wife and I are the same age, and we both changed age bracket last year (which meant a 5% premium increase for both of us, but fine it's in the brochure).

Before shopping around, I would like to be sure that other companies don't use the same practice.

[ThaivisaInsurance]

Me and my family have been insured with LMG Pacific Healthcare for few years. Policy renewal is due next month.

For me, they offer a 5% no claim bonus discount, as I have not been sick last year, this represents 536 THB.

My wife and daughter are on the same policy. My daughter has been sick several times last year, my wife not even once. For both of them the premium has been increased 10% because my daughter claimed benefits several times last year. This increase totals 2045 THB.

I guess this is covered by the terms and conditions which states "the Company reserves the right to adjust the insurance premium to reflect the risk and age of the covered person".

At first I was thinking this only meant that their premiums vary according to age, but I guess it could also cover the premium increase for covered persons who have been sicked previously...

I find this despicable, especially as they increased my wife premium even though she never claimed any benefit (she has never been sick in the few years she was insured).

Are other insurance companies practicing the same premium adjustments?

Sorry, but there were claims on the policy and it does not matter if either one or both claim, it is still a claim on the policy. Your Broker should have explained this to you at the time.

As for other companies, this depends on the level of cover you need but Thai Visa Insurance maybe able to help. Please contact them with your requirements : http://insurance.thaivisa.com/quote-form

[yeti]

I did not use a broker, but contacted LMG directly.

Shouldn't this practice be mentionned on their brochure?

As for other companies, do you know if it's a standard practice or if only LMG is doing business in this manner?

[jingjingna]

I would hazard a guess by saying this is standard practice BUT best let Thaivisa Insurance Brokers enlighten us!

[offset]

Me and my family have been insured with LMG Pacific Healthcare for few years. Policy renewal is due next month.

For me, they offer a 5% no claim bonus discount, as I have not been sick last year, this represents 536 THB.

My wife and daughter are on the same policy. My daughter has been sick several times last year, my wife not even once. For both of them the premium has been increased 10% because my daughter claimed benefits several times last year. This increase totals 2045 THB.

I guess this is covered by the terms and conditions which states "the Company reserves the right to adjust the insurance premium to reflect the risk and age of the covered person".

At first I was thinking this only meant that their premiums vary according to age, but I guess it could also cover the premium increase for covered persons who have been sicked previously...

I find this despicable, especially as they increased my wife premium even though she never claimed any benefit (she has never been sick in the few years she was insured).

Are other insurance companies practicing the same premium adjustments?

Is this the first time that you have claimed if so did they give you any no claims discount before or is the 5% to keep you sweet

Will the increase price go down by 10% +5% next year if you do not claim on your wife's policy the other thing to ask is the 10% the maximum increase or it could be any amount and be away of them getting you of their cover if you come to be to expensive ie. if you have a big claim to double the price next year so you do not renew your policy. Do you know how much your daughters claims were for last year if you do you will have to do the sums to see if it is worth paying the extra

[yeti]

Their 5% no claim bonus policy started last year, so this is the 1st year I enjoy it. We received a nice letter informing us of it when we renewed last year.

What the letter did not say is that the other side of the coin is an increase in premiums depending on how much you claimed the year before.

From what I know now the maximum penaly is a 25% premium increase (but the bonus seems to be limited to 5%). If there is no claim from my wife or daughter next year, I have no idea what the price will be... Their brochure doesn't mention this system whatsoever (and that pisses me off).

[offset]

Their 5% no claim bonus policy started last year, so this is the 1st year I enjoy it. We received a nice letter informing us of it when we renewed last year.

What the letter did not say is that the other side of the coin is an increase in premiums depending on how much you claimed the year before.

From what I know now the maximum penaly is a 25% premium increase (but the bonus seems to be limited to 5%). If there is no claim from my wife or daughter next year, I have no idea what the price will be... Their brochure doesn't mention this system whatsoever (and that pisses me off).

The problems you may have if you decide to change insurance is that you daughters conditions that she had this year may not not be covered by the new insurance company so you might just have to bite the bullet

Just one thing why cant you get your daughter on her own policy

[yeti]

My daughter doesn't have a condition, or anything which can be construed as a preexisting condition by a new insurance company, she is just a baby, and when babies get sick it doesn't take much to have to spend few nights at hospital.

When my daughter was born they told us she had to be put on one of our existing policy, will see if I can change that.

[ThaivisaInsurance]

Their 5% no claim bonus policy started last year, so this is the 1st year I enjoy it. We received a nice letter informing us of it when we renewed last year.

What the letter did not say is that the other side of the coin is an increase in premiums depending on how much you claimed the year before.

From what I know now the maximum penaly is a 25% premium increase (but the bonus seems to be limited to 5%). If there is no claim from my wife or daughter next year, I have no idea what the price will be... Their brochure doesn't mention this system whatsoever (and that pisses me off).

Yeti, what you said here is where most people go wrong :

Their brochure doesn't mention this system

That is correct and the 'brochure' is not meant to mention everything – it cannot, it is a brochure.This is why one is given a 'policy', it is the policy that is the contract between you and the Insurance company – not the brochure.

If when you have received the policy and gone through it and found things you do not like, then that is the time to complain/hand it back/cacnel etc – sorry but what LMG (and all the others) did is standard.

One other point here, you said you went direct to the insurance company – may we ask why ? We are not saying we could have helped after the event as in this case but Brokers are there to help and explain things – and they don't cost you any more !

Do use Thai Visa Insurance Brokers – they may well save you money in the future.

[yeti]

I know the brochure is not supposed to mention everything, but at least it should not be misleading. Having the premiums on the brochure and not following those premiums is not fair practice IMHO. There should at least be a disclaimer.

As for not using a broker, when I looked for an health insurance 5 years ago I did not know any, so I just looked at all the companies I could find, checked coverage against premium, reputation, and decided to sign with LMG. When I contacted them they were not able to send me to one of their agents and instead told me to come to their headquarters, where I met someone with whom I reviewed the policy, the increase in premiums in case of claims was never mentionned.

Do the other companies you are recommending follow the same practice?

[madmitch]

Many companies will us the same practice and not just in health insurance. Premium rates are up to the underwiters and although in most cases the rates as per the brochure are applicable, premium 'loads', exclusions and endorsements are routinely added to the policies.

Although in theory the premiums of the many pay for the losses of the few, it is still common to want a 'payback' following either a large claim or a succession of claims.

If you changed insurers you would have to declare the claims from last year with full details. It is possible that based on that previous claims record that the premium will be greater than that advertised in any brochure.

Shop around by all means but bear my last comment in mind. Declare any prevoius claims/illnesses as if you don't you risk voidance of the new policy.

If you continue with LMG, ask whether the 'load' will be removed next year in tyhe event of a claim-free year.

[rubik101]

This is standard practice in the Insurance industry. All claimants have their premiums increased after a claim.

I know this might be a delicate subject and please ignore me if you like, but babies growing up go through all sorts of common and sometimes uncommon conditions and sicknesses. In my experience, very few, if any, merit a stay in hospital. I know that the Thais tend to rush off to hospital at the first sign of illness but it is generally not required. Most of these illnesses and conditions can be readily treated by a doctor or nurse at home or in the local clinic.

Medical intervention should only be seen as a last resort unless of course the child is running a very high temperature, is badly vomiting/diarrhea or is uncontollably seizing/fitting. Milder forms of these conditions can be treated at home with the right knowledge.

Other, more common maladies can generally be cured at home with bed rest and adequate food and drink intake. Try to avoid too much medication for children. Avoid chemically based cough or cold remedies, honey and lemon will do a far better job.

There is a lot of good information on the Internet regarding treatment of most childhood problems.

www.medicine.net

www.nhsdirect.co.uk

are two good sites to visit before you rush off to hospital.

I hope she remains healthy!!

Good luck

Rubik

[Gary A]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable. This year they pulled another trick. They told me that they had now put me on 80/20 coverage. I pay the first 20 percent. I responded by telling them that I would not be paying the 23,000 baht premium and to cancel my policy. They responded by telling me that they had carefully reviewed my policy and that I appear quite healthy. They decided not to change it to the 80/20.

[yeti]

Good to see they are open to negotiation, will see how (if) they answer the mail I sent them...

[torrenova]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable. This year they pulled another trick. They told me that they had now put me on 80/20 coverage. I pay the first 20 percent. I responded by telling them that I would not be paying the 23,000 baht premium and to cancel my policy. They responded by telling me that they had carefully reviewed my policy and that I appear quite healthy. They decided not to change it to the 80/20.

Thais, like most Asians make the decision to buy before they go to the shop. Price is immaterial as the decision is already made. With insurance, they think you have already decided to have their insurance and are perhaps only looking for the best deal. I've seen this all over Asia and it drives me crazy.

[vagabond48]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable.

That's strange. This past January I got LMG insurance. One of the questions I asked several different brokers was what % increases did my age group have over the last 3 years. Both brokers told me that there were no increases for the 61-65 age group for more than 3 years.

Regarding premium increases due to claims, I thought that increases were made to the age group you belong to and not to individual policies so an age group with a high number of expensive claims would have their premium increase while another age group with lower expensive claims would not.

[ThaivisaInsurance]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable.

That's strange. This past January I got LMG insurance. One of the questions I asked several different brokers was what % increases did my age group have over the last 3 years. Both brokers told me that there were no increases for the 61-65 age group for more than 3 years.

Regarding premium increases due to claims, I thought that increases were made to the age group you belong to and not to individual policies so an age group with a high number of expensive claims would have their premium increase while another age group with lower expensive claims would not.

All Insurance Companies reserve the right to increase the premiums.

[vagabond48]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable.

That's strange. This past January I got LMG insurance. One of the questions I asked several different brokers was what % increases did my age group have over the last 3 years. Both brokers told me that there were no increases for the 61-65 age group for more than 3 years.

Regarding premium increases due to claims, I thought that increases were made to the age group you belong to and not to individual policies so an age group with a high number of expensive claims would have their premium increase while another age group with lower expensive claims would not.

All Insurance Companies reserve the right to increase the premiums.

To individual policy holders rather than age group?

[ThaivisaInsurance]

My premium from LMG goes up every year. Since I am now 64 years old, I suppose it is understandable.

That's strange. This past January I got LMG insurance. One of the questions I asked several different brokers was what % increases did my age group have over the last 3 years. Both brokers told me that there were no increases for the 61-65 age group for more than 3 years.

Regarding premium increases due to claims, I thought that increases were made to the age group you belong to and not to individual policies so an age group with a high number of expensive claims would have their premium increase while another age group with lower expensive claims would not.

All Insurance Companies reserve the right to increase the premiums.

To individual policy holders rather than age group?

Afraid so .................

[ehs818]

I have LMG coverage and am unhappy with their decision on what to pay for a recent hospitalization. My policy says we can to go Arbitration to settle it. Anyone know how this works? Any recommendation for an attorney?

ERIC

[email protected]

[thaiericsweden]

Renewal Premium rates are not guaranteed.

If you are a healthy person with no claims, you can expect to pay the same premiums as other persons in your age group.

If you are sick and have claims that have cost the insurance company money, your renewal premiums will be loaded by a percentage based on the size of the claims incurred by the Insurance Company.

These loadings can range anywhere from 10% to 25% by reputable companies and 10% to over 100% by a few less-than-reputable companies.

Loadings are applied each year as a factor to the basic premium you pay. In later years, these loadings are compounded for each significant claim paid by the Insurance Co.

Insurance premiums are based on the collective results of all insured customers.

You are one of thousands of policyholders that are insured by Health Insurance Company.

Not all customers will have claims each year; this is what keeps annual-premium-increases manageable.

If all customers had claims every year, your insurance premiums will increase by a higher percentage.

The increase in premiums is determined by the collective customer claims that occurred during the previous policy year.

Even if you had no claims, your premiums will still go up by a small percentage.

The cost of insuring your family is averaged out among all customers insured by the company.

If you had a million dollar claim, you can expect a small incremental increase in premium the next year; the insurance company would not ask you to repay the million dollars.

The annual increase in premium would be the same for all other customers in the same age group that you belong to; you will not be penalized for your claim.

On the other hand; if you had no claims in one year, it would not make you eligible to pay the same premium as the previous year.

Four important factors that cause premiums to go up each year:

1. Hospitals increase their medical charges each year.

2. The price of drugs goes up each year.

3. As you get older, you pose a higher risk to the insurance company.

4. In addition to this; as you get older, the cost of treating you will rise exponentially if you have to go to the hospital for treatment.

This health insurance company; like most other health insurance companies charges premiums according to the customer age.

The premiums are usually split into 5-year age groups.

When you started your policy, you were in one age group.

As you get older, you move to a higher age group; you will notice a higher jump in the premium increase when you move to higher age groups.

Each year, health insurance companies have to revise their premiums based on the past year's claims expenses.

If all the customers had a higher incidence of claims, the premiums have a higher annual-incremental increase.

[TallGuyJohninBKK]

I've had an LMG health insurance policy for the past couple years... And they've handled most of my claims without any problem. But I've also not had any major or inpatient claims with them as yet, so I can't speak to those situations.

However, earlier in this thread, a couple of issues were raised that I'd never heard about before seeing them here -- the up to 25% premium surcharge issue and Gary's issue about an attempt to change his existing policy to 80/20 coverage...

I've always read LMG's brochures and policy documents in English carefully, and I never saw anything that appeared to give them the right to do up to 25% individual premium surcharges... They do, however, have much more general language about the ability to adjust based on claims, which I had presumed meant claims at large... not on an individual person claims basis...

I think LMG is WRONG in not more clearly spelling out that kind of a significant financial detail in their policy brochures and other printed materials. They certainly are able to go into all other kinds of details in those materials... so why not the 25% issue... BTW, in actual practice, my broker advised that LMG may adjust their premiums in various increments up to the 25% figure, such as 10%, 15%, 20%, etc... depending on the claims history.

In any case, I took the opportunity of my policy renewal this year to pose questions about those issues to LMG, and through my broker, got answers back from senior LMG folks in their BKK office... So I wanted to share those here FYI.

On the up to 25% premium surcharge issue:

When premium rates are approved by the regulator, each band of premiums rates has a 25% variance in rate movement, so yes premiums can be increased accordingly. Our premium structure is based on individual underwriting so high claimers will pay higher premiums that those who are moderate claimers. [my emphasis added] Policy holders who do not claim during a policy year receive a No Claims Discount on their premium of 5%. Premium rates in Thailand tend to be "Tariff" driven unlike other overseas markets that are market driven.

And a follow-up response on the same issue:

Upon policy renewal our underwriter will review the premium and the claims of the policy. We look at all factors to determine the renewal offer, this includes the age of the member, the claims made for that policy year and any correlation to claims made in prior years, the loss ratio (both current year and lifetime of the policy) and the risk profile of the member. For example; should the claims amount be greater than the premium amount we may decide to increase the premium by up to 25% (maximum) on renewal. Obviously it is not as simple as this, and we look at all aspects of the policy, claims and the medical risks associated.

It is important to note that premiums will also increase based on the age of the member and which age band they fall into. The current year's premium will then form the basis for the renewal premium offered

And then on the 80/20 issue mentioned above:

No such condition is imposed on policies at renewal time. We have introduced co-payments at the commencement of a policy although this is generally either client solicited to lower their premiums or imposed due to the health risks presented at the time of underwriting or in the case of companies seeking staff insurances a requirement of theirs in an effort to control claim costs. We do not impose changes like this or create new exclusions during any policy renewal period as this is morally wrong. New exclusions can be introduced if they have been identified as pre-existing conditions to the start of the contract that the client is aware of but not declared.

[JoePai]

I've had an LMG health insurance policy for the past couple years... And they've handled most of my claims without any problem. But I've also not had any major or inpatient claims with them as yet, so I can't speak to those situations.

However, earlier in this thread, a couple of issues were raised that I'd never heard about before seeing them here -- the up to 25% premium surcharge issue and Gary's issue about an attempt to change his existing policy to 80/20 coverage...

I've always read LMG's brochures and policy documents in English carefully, and I never saw anything that appeared to give them the right to do up to 25% individual premium surcharges... They do, however, have much more general language about the ability to adjust based on claims, which I had presumed meant claims at large... not on an individual person claims basis...

I think LMG is WRONG in not more clearly spelling out that kind of a significant financial detail in their policy brochures and other printed materials. They certainly are able to go into all other kinds of details in those materials... so why not the 25% issue... BTW, in actual practice, my broker advised that LMG may adjust their premiums in various increments up to the 25% figure, such as 10%, 15%, 20%, etc... depending on the claims history.

In any case, I took the opportunity of my policy renewal this year to pose questions about those issues to LMG, and through my broker, got answers back from senior LMG folks in their BKK office... So I wanted to share those here FYI.

On the up to 25% premium surcharge issue:

When premium rates are approved by the regulator, each band of premiums rates has a 25% variance in rate movement, so yes premiums can be increased accordingly. Our premium structure is based on individual underwriting so high claimers will pay higher premiums that those who are moderate claimers. [my emphasis added] Policy holders who do not claim during a policy year receive a No Claims Discount on their premium of 5%. Premium rates in Thailand tend to be "Tariff" driven unlike other overseas markets that are market driven.

And a follow-up response on the same issue:

Upon policy renewal our underwriter will review the premium and the claims of the policy. We look at all factors to determine the renewal offer, this includes the age of the member, the claims made for that policy year and any correlation to claims made in prior years, the loss ratio (both current year and lifetime of the policy) and the risk profile of the member. For example; should the claims amount be greater than the premium amount we may decide to increase the premium by up to 25% (maximum) on renewal. Obviously it is not as simple as this, and we look at all aspects of the policy, claims and the medical risks associated.

It is important to note that premiums will also increase based on the age of the member and which age band they fall into. The current year's premium will then form the basis for the renewal premium offered

And then on the 80/20 issue mentioned above:

No such condition is imposed on policies at renewal time. We have introduced co-payments at the commencement of a policy although this is generally either client solicited to lower their premiums or imposed due to the health risks presented at the time of underwriting or in the case of companies seeking staff insurances a requirement of theirs in an effort to control claim costs. We do not impose changes like this or create new exclusions during any policy renewal period as this is morally wrong. New exclusions can be introduced if they have been identified as pre-existing conditions to the start of the contract that the client is aware of but not declared.

Good explanations by LMG - now we know

[Gary A]

I had LMG health insurance for a number of years. My yearly premium the first few years was 13,000 baht. Over the years I had one claim for appendicitis. I have now cancelled the policy because I refuse to pay the 28,000 baht premium per year. The last year I paid the premium it was 25,000 baht. When I bought the policy it was promised that they would not cancel me because of age. They said nothing about eventually pricing me out.

[nocturn]

I did not use a broker, but contacted LMG directly.

Shouldn't this practice be mentionned on their brochure?

As for other companies, do you know if it's a standard practice or if only LMG is doing business in this manner?

of course it is standard practice, the more you use health insurance the more i goes up with most companies.

there are plans and memberships like RBIPremium who will not raise the membership costs based on claims as the membership is a set fee.

www.rbipremium.com

They do offer a cash-back discount for a claim free year, but it is significantly higher than 5 percent

[TallGuyJohninBKK]

I had LMG health insurance for a number of years. My yearly premium the first few years was 13,000 baht. Over the years I had one claim for appendicitis. I have now cancelled the policy because I refuse to pay the 28,000 baht premium per year. The last year I paid the premium it was 25,000 baht. When I bought the policy it was promised that they would not cancel me because of age. They said nothing about eventually pricing me out.

Gary, of course, I don't know the particulars of your situation....and the details involved...

But in general, for others here, it would seem three different price factors can come into play:

1. the age-band based premium structure LMG uses, whereby the standard premium rates increase gradually every 4 or 5 years as the policyholder gets older... no surprise about that.

2. the marketplace driven premiums overall, reflecting their overall claims experience and expenses... In other words, the general price increases they may adjust their entire premium structure by from time to time... LMG went several years without any annual across-the-board increases, then passed along a single pretty large increase a year or so ago...across their entire policyholder base...

Unfortunately, in my case, I believe their one big annual increase happened to coincide for that year with me moving to a higher/older age band, so my policy premium at renewal that year took a big hit upward.... But overall, during the 4 years I've had my policy with them, their general increase (1 year out of 4) wouldn't be considered too excessive relative to annual cost of living/inflationary levels.

3. And then, in what for me was a hidden factor until it became clear here, the special up to 25% adjustment applied on a discretionary basis to individual policyholders based on their claims experience.... I don't have any personal experience with other Thai health insurance providers here as a policyholder... But the LMG folks made it sound like such adjustments are a common feature of coverage here.... I'd be interested to know more about that issue....

In my case, the 25% premium surcharge potential led me, this most recent year, to change my policy from a full coverage, no deductible one that I'd had to now a 40,000 baht annual deductible one... which of course included a reduction in my premium, a 20 or 25% reduction based on the deductible, I believe...

What I also confirmed is, that if I don't go over my annual deductible and thus have no claims for a year, then their 5% no claim discount would apply for my next renewal... notwithstanding the fact I might have paid for my own medical stuff under the 40,000 deductible amount...

Thus far, in 4 years of policies with them, I've fortunately never come anywhere close to exceeding 40,000 baht on annual medical expenses... So it seemed kind of pointless to continually be eating away at my lifetime policy limits with small amount claims, and then losing out on the 5% no claims discount, and then paying the higher premium each year for the no-deductible policy...

So my intent moving forward will be to pay the small stuff out of my own pocket, and reserve the medical insurance for big/bigger ticket issues...hopefully as few and far-between as they may be...

[TallGuyJohninBKK]

Two other things...

1. I think this discussion points out the importance, anytime you get a premium increase at renewal time, of discussing with your broker or the company just what the basis of the increase might be...

When I signed up for my LMG policy originally, I got from my broker what, at that time, were the annual policy rates for my coverage not only for my age at that time, but also for the higher/older age bands at that time, so I could see just how much the premiums were set to rise in future years...

Now, I look at that same information updated each year...so I can see if the renewal I'm getting is the amount it should be based on my age band....or if anything extra has been thrown in... LMG's policy brochures include those age-based premium bands and amounts...and the brochures are updated as their premiums change and with time... So I think it's always a good idea to have/keep whatever is the latest version for one's policy.

The reason for that, of course, is, as a policyholder, you're not going to have any ability to negotiate with the company over their cost-of-living or age-band based increases... But the claims driven increases (the up to the 25% surcharge issue) are a different matter. That's where subjective judgments by an underwriter come into play... And that's where one's broker has the ability to discuss and intervene/lobby, if such an increase seems unwarranted....

2. I also was interested in the issue one poster raised above whether, if LMG applied the claims based premium surcharge in one year because of claims the prior year, would the surcharge automatically come off the next year, assuming there wasn't continued claims filings... And.... I didn't get a clear or satisfactory answer to that... Or to put it more directly, LMG would not say that the surcharge would automatically come off in the following year.... Instead, they talked about a broad underwriting review considering multiple years claims experience, age, etc etc...

[TallGuyJohninBKK]

there are plans and memberships like RBIPremium who will not raise the membership costs based on claims as the membership is a set fee.

www.rbipremium.com

They do offer a cash-back discount for a claim free year, but it is significantly higher than 5 percent

The link above as originally posted doesn't work, so here's the corrected link for that entity...

http://www.rbipremium.com/

BTW, their web site mentions that they only deal with customers up to age 65. And to join, you need to be age 55 or under.