Hospital cash benefit: daily income subsidy for freelancers

Today, there is an increasing number of freelancers entering the workforce. These people often enjoy greater autonomy and have the flexibility to arrange their work according to their personal schedules and even preferences. Being self-employed as a mode of working is not only attractive to young people, but also many wage earners in their 30s and 40s seeking a career change that offers greater work-life balance.

One of the major challenges for self-employed people is coping with an unstable income. Another key point to consider is that, since these individuals are not permanent employees of any companies or organisations, they cannot benefit from the group health insurance plans that would otherwise be provided. In the event of a serious illness that requires hospitalisation and prevents them from working, freelancers without paid sick leave may face a break in income and have to bear all medical expenses on their own, which undoubtedly puts a huge financial strain on them. However, this is where a hospital cash insurance policy can offer timely financial support.

Despite the wide range of medical insurance products available on the market covering medical and surgical expenses, they generally provide reimbursements but do not cover the loss of personal income. To alleviate financial pressure during medical treatment, freelancers may consider taking out a hospital cash insurance plan, which mainly provides cash allowances based on the number of days of hospitalisation, to help compensate for the loss of income and reduce the impact of the injury or illness on their daily lives.

The daily coverage of hospital cash insurance is typically a several hundred to over a thousand Hong Kong dollars, with the amount doubled for stays in an intensive care unit. This coverage is applicable worldwide and, in some cases, lasts for hundreds of days. Many insurance companies have also broadened the scope of coverage to include emergency outpatient and surgical expenses arising from accidents occurring overseas. With premiums as low as just a few Hong Kong dollars per day, this additional protection, coupled with standard medical insurance, offers peace of mind against unexpected health problems.

For example, during a self-drive tour in Hokkaido, a freelancer, suffered a thigh fracture when he lost control of his car during heavy snowfall and crashed it into a lamp post. He was hospitalised for four days. Fortunately, he had already taken out a hospital cash insurance policy, which provided him with up to HK$30,000 in daily cash benefits and overseas accident protection. This was sufficient to cover his loss of income during the hospitalisation period and enabled him to receive treatment without worrying about the cost.

A hospital cash allowance plan is primarily designed to ease the financial burden during hospitalisation. To enhance this support, some insurance companies have taken it a step further by providing additional protection, such as transportation and hospital parking fee allowances, as well as extra bed allowances. Doing so caters to the needs of the insured person and their families, bringing greater convenience to all.

Hospital cash insurance is well-suited to people of all ages, from infants to retirees. Still, when choosing a plan, you should have a clear understanding of the scope of coverage. Also, pay attention to the exclusions, such as injuries or illnesses occurring within a waiting period after the effective date of the policy, and various types of routine medical check-ups and treatments. In addition, employees in certain occupations might not be eligible for this type of plan due to the specific nature of their jobs. It is advisable to make enquiries and compare different plans before taking out one that truly suits your needs. That way, you will be safe in the knowledge that you can cope with unexpected challenges and enjoy each moment with complete security.

This Chinese version of this article was published in the Hong Kong Economics Journal 

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