Essential reading for expectant and new parents! How to choose insurance for your little ones?
Health2024-11-18
5 Mins Read
As parents, we’re always keen to give our kids the very best. Even before they arrive, expectant parents often start getting ready for their little one—hiring a cleaner, picking up the essentials, sprucing up the home, and checking out local schools—each moment brimming with excitement and anticipation for the new arrival.
Proactively supporting a child's development is essential. Encouraging children to embrace new experiences with confidence necessitates comprehensive protection. Today, numerous products marketed as 'children's insurance' are available. How should expectant parents navigate these options? When is the appropriate time to purchase each type of insurance for their children? Today, we will offer detailed insights for current and soon-to-be parents, empowering you to make informed decisions!
What insurance needs do children have?
1. Critical illness insurance: Thanks to advancements in medical technology, many serious illnesses now see much better recovery rates. However, the treatment costs can still be rather steep. Critical illness insurance provides vital financial support when children are diagnosed with certain major conditions. The lump sum payout serves to cover for medical expenses or to cover everyday living costs, helping to offset any loss of income for parents who need to look after their unwell child.
2. Medical insurance: Unlike critical illness insurance, which covers specific major or minor illnesses, medical insurance primarily addresses hospitalisation, surgical procedures, and outpatient treatment costs, reimbursing on a claim basis. Children are particularly susceptible to minor illnesses as their immune systems are still developing. This makes medical insurance essential for meeting unexpected health needs, significantly reducing the financial burden on families and ensuring timely medical support when necessary.
3. Personal accident insurance: Children are active and playful, which makes them prone to accidental injuries, underscoring the importance of accident insurance. This type of insurance typically covers medical expenses resulting from accidents, hospital allowances, and other related costs, providing essential medical support and financial security in the event of unforeseen accidents, thereby offering peace of mind to parents.
4. Savings insurance: To ensure that children receive a quality education, parents need clear savings goals and plans. By utilising savings insurance, parents can establish an education fund early on, which not only helps manage educational expenses and provides life insurance protection—alleviating financial pressure—but also allows children to focus on their studies during their school years. Furthermore, it opens up broader development opportunities for their future, such as studying abroad and expanding their horizons.
When should parents purchase insurance for their children?
Before purchasing insurance, parents should assess their child's actual needs and thoughtfully plan their premium budget based on the family’s financial situation to avoid any economic burden. It is also essential to choose reputable insurance companies with strong financial stability to ensure that necessary claims services can be accessed when needed. At various stages of a child's development, the following insurance arrangements can be considered:
- Before birth: In fact, expectant parents can consider purchasing insurance before their child is born. From pregnancy to childbirth, protecting the expectant mother is crucial, while also providing lifelong critical illness coverage for the newborn from birth.
AXA TotalAssure Critical Illness Plan – BabyPro offers coverage starting as early as 18 weeks of pregnancy, protecting both mother and baby from designated pregnancy complications. This plan also offers a Postpartum Depression benefit for parents, as well as continuous coverage for the baby's undetected congenital related illnesses at the time of policy application.
- Ages 0 to 3: During this stage, a child's immune system is not fully developed, making them vulnerable to diseases. Therefore, medical insurance and critical illness insurance should be the top priority. Parents should also consider using savings insurance to establish an education fund for long-term planning regarding their child's educational and living expenses.
AXA FortuneXtra Savings Plan offers up to 9 currency options1, flexible currency conversion, and policy value locking options, making it highly adaptable; its attractive returns and sufficient liquidity help parents achieve significant financial goals, with unlimited opportunities to change the insured of the policy2, facilitating wealth transfer across generations.
- Ages 4 to 10: As children's activities expand, the importance of accident insurance increases. During this stage, comprehensive accident insurance is advisable, alongside maintaining critical illness and medical insurance.
An accident insurance solution designed to protect families either as a group or as an individual, AXA’s SmartProtect Plus can help our customers handle medical and out-of-pocket costs that can add up after an injury, from emergency treatment, hospital stays, income loss, even death and disability. And for shared coverage, they pay premium for one child only regardless of the total. Children also get double hospital cash and home nursing allowance. - Ages 10 to 18: In adolescence, children still face illness risks, and their exploration of the world continues to widen. Therefore, critical illness insurance, medical insurance, and a personal accident insurance plan remains crucial.
Parents should also reassess whether their existing medical coverage is sufficient and timely, especially if their children plan to study or live in Mainland China or overseas. AXA’s Medical Protection Series has a medical network spanning multiple countries - over 2,000 hospitals3 in Hong Kong and mainland China, and more than 10,000 medical service providers around the globe4. This means that no matter where their child is, they can almost always find a top-tier hospital that offers cashless service at discharge5 when needed, ensuring timely and efficient medical care.
How to choose the right insurance for children?
Compare different insurance products
When selecting suitable insurance for children, the first step is to assess their insurance needs. Then you can compare products from different insurance companies. Here are some factors for consideration:
- Premiums: Understand the premium amounts for each plan to ensure they fit within the family budget.
- Coverage: Compare the coverage of each insurance product, including hospitalisation, outpatient treatment, surgeries and critical illnesses. Also, make sure to consider whether the personal accident insurance you choose meets your family's needs, and whether the features of the savings insurance product are suitable for planning an education fund for your children.
- Payout limits: Evaluate the payout limits of different products to ensure they can cover potential medical expenses.
Parents should select the most suitable insurance products based on their child's specific needs. For instance, children who frequently fall ill may benefit more from medical insurance, while more active children may require additional accident coverage. Furthermore, recent reports6 indicate that the government is considering adjustments to local university tuition fees. Therefore, it is wise to take into account factors such as medical inflation and rising tuition costs. Even if there are no immediate plans to send children abroad for their education, early planning for an education fund is essential.
AXA: Your partner in protecting your child
Having read the above, you should recognise the importance of long-term planning and health protection for your child. With AXA's wide range of protection products, our customers can create a stable living environment for their children, alleviating financial worries in the face of unexpected events. This protection is invaluable, paving the way for their child's dreams.
Whether you choose to purchase insurance early or adjust it according to different growth stages, you can ensure that your child grows up surrounded by love and responsibility, free from worries. Start today by selecting the right protection products, creating an umbrella of security for your child, and enabling them to explore every step of life with confidence!
1. The currency conversion option can be exercised within 30 days from each policy anniversary from the 3rd policy anniversary and only one application can be made per policy year. For the currency and exchange rate risk and changes due to exercising the Currency Conversion Option, please refer to the “Important information” of the product brochure of FortuneXtra for details.
2. The Change of Insured Option can be exercised an unlimited number of times. Written application for the exercise of the Change of Insured Option should be made by you and such application is subject to the administrative rules, underwriting requirements and approval of the Company.
3. Eligible AXA clients can access medical services at designated hospitals and medical networks in mainland China. The list and the number of network hospitals and medical networks are subject to change from time to time.
4. Only applicable to designated medical plans and benefit levels. The list and the number of hospital service providers is subject to change from time to time.
5. Only applicable to designated medical insurance plans.
6. Source: https://www.news.gov.hk/eng/2024/06/20240620/20240620_115928_221.html
Information and materials provided is general in nature and does not constitute medical or health advice from AXA Hong Kong and is on an “as is” and “as-available” basis without representation and/or warranty of any kind, either express or implied. While AXA Hong Kong has taken reasonable care in providing such information and materials, they are not specific to your investment objective, financial situation, health or medical conditions or particular needs. No warranty or responsibility is assumed by AXA Hong Kong and our related or holding companies regarding non-infringement, security, accuracy, completeness, adequacy, reasonableness, fitness for a purpose or free from computer viruses in connection with the information and materials provided. AXA Hong Kong and our related companies and holding companies do not accept any liability for any loss, damage, cost or other expense, whether wholly or partially, directly or indirectly, arising from any error, inaccuracy or omission of the information and materials to the extent that such liability is not excluded by law.
For details of AXA “Winter Delights” Programme, please refer to the Terms and Conditions of AXA “Winter Delights” Programme (the “Terms and Conditions”) stated in the leaflet.
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