Insurance Facts- You Should Know about
The insurance industry is a multi-billion-dollar industry with potential for the never-ending growth. There have been many huge and interesting payouts and laws across the world regarding insurance.
People avail insurance to get security by spending a little amount of money in premiums. Getting insured is a mark of safety and protects citizens from going bankrupt or investing life’s saving into unfortunate incidents. The insurance industry is a multi-billion-dollar industry with potential for the never-ending growth. There have been many huge and interesting payouts and laws across the world regarding insurance. From David Beckham’s £100 million insurance policy of legs, feet, and 10 toes to the tragedy of 9/11 and the loss of lives and properties resulting in nearly $40 billion in payouts, the world has filled with a lot of surprises and jaw dropping figures when it comes to insurance. Following are some of the surprising and eyebrow raising facts about insurance.
Major bankruptcies were due to medical bills
Nearly 62% of bankruptcies in the U.S. have occurred due to medical bills. The bankruptcies raised by more than 50% during the six-year period from 2001 to 2007. According to a report by The American Journal of Medicine, most of those who went bankrupt were middle class homeowners. The lead author Steffie Woolhandler, M.D., the Harvard Medical School, Massachusetts stated that if the illness is long enough and expensive, the private insurance provides a very little protection. He implied that unless you are Bill Gates or Warren Buffett, only one illness is enough to make you go bankrupt. In the survey, Woodlander and colleagues discovered that 78% of people they surveyed had health insurance and still many of them went bankrupt due to gaps in the coverage such as deductibles, co-payments, and uncovered services. It was surprising to find out that lavish lifestyle or overspendings have not been reasons behind people going bankrupt.
Starbucks spend more over employee healthcare than coffee beans
Howard Schultz came back as CEO of Starbucks in January 2008 and took a major step in employee healthcare. Despite knowing the worst conditions of the company, he refused to roll down healthcare costs to employees. The healthcare costed nearly $300 million at that time, which is more than the company invests in coffee beans. Another shareholder informed him that he can cut the benefits of part-time employees. However, he declined to adopt the strategy. Schultz outlined that the passion for healthcare roots from his youth in Brooklyn. His father struggled in many low-wage jobs and none of them had health insurance.
Sony’s profits come from insurance business
Sony is one of the leading market players in the electronics industry across the world. However, it did not drive much profit to the company in a decade that ended in 2013. Its insurance business drove a huge profit in the same decade. The insurance business of Sony did not exist in the U.S. or Europe at that time. It sold life, medical, and auto insurance in Japan and nearly 63% of its profit resulted from financial operations. Its life insurance generated staggering $9.07 billion in profits during the decade. Many eyebrows were raised when the reports emerged that the leading tech giant actually earned its profits from insurance business.
No mental health therapy as it leads to disqualification
Many U.S. citizens who need mental health therapy do not get to pay for it through insurance as it disqualifies them from life insurance. Once they use insurance to pay for the therapy, they will be registered in the directory that all the insurance companies have. Once the citizen applies for a medical, life, and disability insurance, the mental health diagnosis plays a crucial part in approving the insurance. The life insurance premiums could go high if there is a record of diagnosis. Some of the mental health therapists put all the clients in the directory without considering the impact on the future. Many citizens cannot afford premiums and be deprived of the life insurance.
Employees working more than 20 hours/week get health insurance in Hawaii
Since 1974, a state law Hawaii Prepaid Health Care (PHC) Act (PHCA) came into picture for improvement in healthcare coverage. It directed employers regarding minimum standards for healthcare benefits. Under the law, employers need to provide health insurance benefits to employees who offer their services for more than 20 hours per week for at least four or more consecutive weeks. There is also a federal law which states that employers need to pay health insurance to employee who worked at least 30 hours per week. This law came into existence since January 1, 2014. There are two different set of penalties for employers who do not comply with these limits.
Staggering British figures & travel insurance
In 2013, nearly 3,800 British citizens were hospitalized in foreign countries. The average medical claim costed around £1,400. However, the cost of treatment of sudden illnesses and serious injuries may go high up to £100,000. This may lead to putting all the savings of life into treatment abroad. However, there is a solution to it in terms of travel insurance. These findings outlined the need to get travel insurance in the U.K. The alarming figures raised the awareness about travel insurance, rather selecting the right travel insurance plan, for the British citizens. Moreover, the awareness regarding travel insurance is gaining across the world. According to Progressive Markets, the global travel insurance market garnered nearly $14.0 billion in revenue in 2014, and would reach $32.7 billion by 2025, growing at a CAGR of 8.5% from 2018 to 2025. The risks related to travel have enabled people to opt for insurance and enjoy a tension free journey.
No company wants to insure Jackie Chan’s productions
Jackie Chan performs all of his own death-defying stunts in his movies. All insurance companies knew the risks he and other stuntmen take in the movies and refused to underwrite insurance. During the filming of Police Story, Mr. Chan established the Jackie Chan Stuntmen Association. He trained all the stuntmen personally and paid medical bills from his own pocket if they got injured during the performance.