Common Myths About Health Insurance

Whether you’re purchasing international health insurance for the first time, or you’ve been with your health insurer for a number of years, it’s likely you may come across certain myths, rumours and stories of bad experiences that could put you off the idea of health insurance altogether.

We know this, because we often get asked about these things by William Russell members. Sometimes it’s because a friend or colleague has told them that their health insurer will try everything possible not to pay out on their claim, or that if they do claim their premiums will skyrocket next year.

We’d like to debunk some of the most common rumours and myths that seem to circulate about insurance. This is to reassure you that the right health insurance policy will always be a benefit to your quality of life and well-being, especially if you are living abroad as an expat.

Health insurance myths

Health insurance will only benefit me if I make a claim
If I claim, my premiums will skyrocket
I can get away with lying on my application form
I can just set some money aside each month to pay for my own medical treatment if I need it
With a health insurance policy, I shouldn’t have to pay a penny for healthcare
My insurer is just going to reject my claims anyway

Female doctor with her senior male patient talking about his medical report after an examination at a hospital reception desk

Myth: Health insurance only benefits me if I make a claim

Truth: Health insurance is just like any other form of insurance – there for when you need it

We do not overlook the fact that, for many people, health insurance can be a significant expense. In 2023, the average yearly premium for an individual insured with us was US$4,871.

And while there are many ways to lower the cost of your health insurance premium, you may question whether you are seeing any value at all from these expenses. For instance, if you go a year without making a claim, you may wonder what you’ve actually spent your money on.

You may even think that you are supposed to claim on your health insurance, in order to derive value from your policy. So, whether it’s a slight cough, a stubbed toe or a small scald from the kettle, you might be inclined to visit the nearest emergency room, simply to ensure you’re making use of your expensive health insurance policy.

But health insurance is a form of insurance, and insurance is there to do one thing: mitigate risk.

Health insurance covers you against the kind of expenses you could not otherwise afford, such as life-saving and emergency treatments for major illnesses and injuries. Health insurance ensures you’ll have access to the high-quality treatments you need, when you need them.

So, yes, you can buy a health insurance policy that covers you for doctor visits and routine check-ups. However, you’ll end up paying more for that cover in the form of higher premiums.

It’s not like a gym membership

Some people think of health insurance like a gym membership. If you buy an expensive contract at your gym, the best way to ensure you’re deriving the most value from it is to go to the gym as often as possible.

But health insurance is not a membership – it’s insurance – and so the opposite is true. If everyone claims as much as possible on their health insurance for medical expenses, premiums will become more and more unaffordable.

Health insurance is there to protect you when you can’t afford expensive medical bills. You may only need to use your policy a few times during your whole life, but you will be glad to have it when the time comes.

Having health insurance is important not because it gives you access to lots of small expenses, but because it can help to pay for astronomical expenses—such as treatment for major illnesses and injuries. This is when you’ll derive value from your health insurance.

The cost of healthcare is increasing around the world

Learn more about rising healthcare costs

Myth: If I claim, my premiums will skyrocket

Truth: William Russell won’t increase your premium because you make a claim—but prices rise for everyone if we receive more claims than expected

We can’t speak for all insurers – because we know some insurers do increase their members’ premiums after they’ve made a claim – but at William Russell, we never hike an individual’s premiums after they make a claim. Let us explain why…

It might be useful to imagine William Russell as a pot of money. Each year, our members fill that pot with their premiums.

When a member makes a claim, we’ll dip into the pot of money to pay their expenses.

If a lot of members need to make a lot of claims, the pot of money may deplete faster than expected. In this case, we may increase the cost of premiums across the board, so that we can refill the pot. In other words, if the pot empties faster than it fills, we’ll ask everyone to chip in a little more.

In simple terms…

Every member contributes to a money pot through their premiums
When a member makes a claim, we pay from the money pot
If the pot gets low, everyone’s premiums may go up slightly
But if the pot gets too full, there is less pressure on us to increase premiums

Please note: these are not the only reasons your premiums may change.

What causes health insurance premiums to increase?

What we will never do is penalise one individual for making a claim. That’s what the money pot is there for, after all! We feel this is the fairest way to provide insurance. You buy a policy from us in good faith – if we were to penalise you for using your policy in the way it was intended, then we’d be nothing more than sharks.

Furthermore, if we penalised a member with higher premiums, we would eventually make their policy unaffordable—leaving them without insurance cover.

That’s a lose-lose situation for everyone: they have to give up their health insurance, and the pot loses out on their contributions. So, we make sure to avoid that scenario.

There are other reasons your premiums may increase over time, but with William Russell making a claim will never be one of them.

The fee you pay for your health insurance policy is called a premium

We explain how we calculate your health insurance premium

Myth: I can get away with lying on my application form

Truth: Not really, and even if you could it would be a terrible idea

When taking out health insurance for the first time, you’ll be given a medical questionnaire to fill out.

This is the first step in a process called underwriting. We use this process to figure out your level of risk – in other words, how likely you are to make a claim.

Some people believe that they can get away with lying at this stage. For instance, if someone knows they have a long-term back condition, they might choose to downplay their condition or not to declare it at all, knowing that if they do they will either:

Have to pay a higher premium
Be denied health insurance altogether
Have their back condition excluded

This is known as non-disclosure, which is a form of insurance fraud. This could lead to several consequences, including claims not being paid, or the whole policy being cancelled.

Insurance fraud affects us all

According to the United States Coalition Against Insurance Fraud, insurance fraud costs every consumer around US$900 per year in excess premiums, adding up to over US$100 billion in the health insurance sector alone.

Stamping out insurance fraud is everyone’s responsibility if we want to ensure the best quality insurance at the fairest price.

As an insurance provider ourselves, we go to great lengths to prevent fraud. This is not just to protect our own financial interests, but the interests of all our members.

When going through the underwriting process, we make a calculation of each member’s risk. We depend on their honesty to give us a fair picture of their health, in order to calculate this risk accurately.

If someone lies about or tries to cover up a known condition, we may end up under-charging them. When they make a claim, they will be effectively taking money from the pot that every other member has paid into fairly.

When someone is dishonest, it’s usually very easy to spot. For example, if a member makes a claim for treatment related to type-1 diabetes a few months after their policy starts, it’s quite likely that the member has been a long-term sufferer of diabetes.

At William Russell, we have software that flags unusual activity and strange patterns in claims. Fortunately, we find that instances of bad faith claims are very rare, but we do have policies for dealing with them when they arise.

Rest assured we take a firm approach to fraud for the benefit of all our members. We don’t want anyone paying the price for someone else’s deception, and we’re proud to say we have paid out on 100% of all legitimate claims.

Are you applying with a pre-existing medical condition?

If you have a known medical condition – either an ongoing condition or one you’ve experienced in the past – you may find it difficult to take out health insurance.

If you do have a pre-existing condition, please don’t try to hide it. Instead, talk to us about it and see if there are options available to you.

Learn more about pre-existing medical conditions

Are you thinking about switching health insurance providers?

What should you do if you have a pre-existing medical condition?

Myth: I can just set some money aside every month to pay for my own medical treatment if I need it

Truth: While you may be able to afford minor costs like doctor appointments, the cost of treatments for major illnesses and injuries is way outside most peoples’ budgets

So, you’re moving to another country and you’re thinking about whether or not to take out health insurance.

While some people choose not to take out insurance and rely on their own income or savings, this passes all the risk onto their own finances.

If you choose to go this route yourself, you’ll need to be comfortable with the fact you may end up paying huge expenses out of your own pocket – especially if you will be living in a place where the cost of healthcare is very high.

To put the potential costs in perspective, we have previously paid out a single claim that totalled over US$390,000.

There are, of course, other options. You could subscribe to your new home country’s state healthcare system. For this, you will need to make sure you are eligible, which may be difficult as a new expat – some countries even require expats to have private medical cover.

You’ll also need to think about the quality of state healthcare where you’re moving. Will you have access to top-quality medical equipment, highly-trained staff and clean, comfortable hospitals? Does the country have long waiting lists for treatments or overcrowding in hospitals? Will you be able to speak with medical professionals who are fluent in English?

If you would prefer private medical care, but don’t want to take out health insurance, you may consider keeping some of your own money aside in case you do need to go to hospital.

Another thing to think about is what to do if you fall sick or become seriously injured while out and about. With William Russell’s private health insurance, you’re covered for medical evacuation to a top-quality medical facility if you’re facing a life or limb-threatening emergency and local treatment isn’t available. But if you are covering your own expenses, you may have to call upon a very expensive rescue and ambulance transfer out of your own pocket.

Health insurance is designed to protect you from these potentially extreme costs, should the worst happen. If you are thinking of covering your own expenses, you may want to calculate the cost of any potential worst case scenario before you commit to foregoing health insurance.

Can I survive with just travel insurance?

Travel insurance does protect your health in a foreign country, but is typically intended for short trips (up to 30 or sometimes 90 days).

You may find the cost of travel insurance to be more expensive in the long-term, because it is not just intended to insure your health, but the cost of your luggage, delays and cancellations too.

What’s the difference between international health and travel insurance?

See how an emergency medical evacuation works in practice

Read about how we airlifted a family from Mauritius to South Africa for emergency treatment

Myth: With a health insurance policy, I shouldn’t have to pay a penny for healthcare

Truth: Your insurance can cover anything and everything, but it’s best to only use it for the ‘big’ stuff

We’ve talked about how health insurance can help cover the cost of expensive treatments like cancer. But what if you want to cover the cost of the less expensive things too, like routine health check-ups, visits to the doctor and physiotherapy sessions?

The short answer is that you can choose a level of cover that includes smaller expenses. Some refer to this as a ‘never out of pocket’ approach to insurance.

If you choose to use your insurance like this, it’s important to remember that what you gain on the swings you lose on the roundabouts; for a higher level of cover, you’ll also pay a higher annual premium. In the end, the added cost to your premium may outweigh the value you gain.

State healthcare and private health insurance

Some health insurance providers offer policies that complement the state healthcare system.

In the UK, for example, certain policyholders can benefit from NHS treatments as usual, while private health cover kicks in should they need to be referred to a specialist.

This is a common strategy that allows people to get the most out of their health insurance for the best possible price.

On the other hand, if you take out private health insurance while still being prepared to pay minor expenses out of your own pocket, you can actually reduce the cost of your policy by setting a higher excess. This is the amount you will pay out of pocket when making any claim, and you can only claim for treatments that cost more than your excess.

By setting a higher excess and receiving a lower premium, you may end up making a net saving overall—even if you pay for a few low-cost treatments out of your pocket over the course of the year.

Therefore, choosing a health insurance policy that only covers major expenses may end up being the more economic option for you.

Your policy, your choice

You are always free to choose the level of cover you desire.

At William Russell, we offer four levels of cover as standard, with added extras such as maternity cover, dental cover, mental health care and cancer care.

Before committing to a policy, make sure you have read our full guide to levels of coverage and that you know the policy that’s right for you.

If you have any questions, please don’t hesitate to get in touch with our friendly, award-winning team—we’d be happy to help.

Get a Quote

All health insurance policies come with exclusions

Learn more about what our policies don’t cover

Myth: My insurer is just going to reject my claims anyway

Truth: At William Russell, we will never deny a legitimate claim

Unfortunately, many people have a poor opinion of insurance companies. The 1997 film The Rainmaker, starring Matt Damon, has a lot to answer for there.

And while it is true that some insurance companies have a bad reputation for denying claims, the good news is that this rarely happens when the customer takes out an insurance policy with a reputable company in a country with robust contract laws and consumer protections.

Insurance is, after all, a contract – and is subject to all contract laws in the territory where it is purchased.

For this reason, it’s important to only take out an insurance policy for a reputable provider based in a territory you know and trust. Before taking out a policy, you should know where your insurer is based, and what the laws surrounding insurance contracts are in that country.

In the best case scenario, you’ll want to find an insurance provider based in a country with a strong rule of law and a robust system of financial services regulation.

Ideally, there should be a governing body, such as an ombudsman, who you can refer to in the case of a dispute. You may also want to choose an insurer based in a country where you are familiar with the local legal language, e.g. English.

Why might my claims still be denied?

Even if you know and trust your insurance provider, you may still find your claims denied.

This sometimes occurs in situations where you have misread the terms of your policy. The main reason is when you make a claim for something that your policy doesn’t cover. It may also occur if you weren’t entirely truthful and realistic in your application, and new information comes to light while you are making a claim.

To mitigate the chance of this happening, you should make sure you read all the wording of your policy carefully before agreeing to it, and that you are honest and transparent in your application.

If you need help or advice, you may benefit from speaking to an insurance broker.

You may also find the answers to your questions in our blog.

Discover more in our blog

It is also up to you to follow your insurer’s proper procedure when making a claim.

Make sure you keep a copy of your insurance certificate and membership card on hand. If your policy states you must receive treatment at a certain hospital or clinic, don’t try to claim for treatment you receive at a different hospital.

Be aware of exclusions in your policy and understand that these will not be covered. Make sure you keep all receipts and paperwork, and that you file every claim accurately and on time.

Remember:

Most legitimate insurance providers will be happy to help you, rather than trying to work against you.

They will always offer to help you to file a correct and accurate claim as this is for your benefit as well as theirs. At William Russell, we’re proud to offer fair and transparent services to all our members. We have paid out 100% of all legitimate claims, and we will continue to do so.

We’re incredibly proud of our reputation for great customer service

What does customer service mean to us and why does it matter?

Choose William Russell for your international health insurance

At William Russell, we have over 30 years’ experience providing international health insurance to expats like you.

We are proud of our exceptional customer service, which has earned us the Feefo Platinum Trusted Service Award. We believe in offering a personal touch with every policy, providing all members with their own dedicated account manager and access to our 24-hour claims line. Read why so many of our members recommend us here.

Take the stress out of health insurance by choosing William Russell. Find out more about our international health insurance policies and get a quote online in under two minutes today.

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