Government Clamps Down on Health Insurance Products in South Africa

    February 28, 2017

    The South African medical aid and short-term insurance industry are in for major Government imposed changes starting in April this year. Here we will have a look at health insurance products in South Africa.

    The new regulations have been under investigation and extensive consultation between Government and the insurance industry for several years.

    So effective from the beginning of April this year, the regulations will clearly demarcate terms under which health care insurance and medical aid products can be provided.

    Primary Health Care Insurance Policies

    Health Insurance ProductsThis type of insurance will no longer fall under the insurance industry’s ambit of control.

    Instead, it will fall under the umbrella of the Medical Schemes Act.

    Primary Health Care insurance offers low-cost health insurance benefits.

    The industry has, however, been given a two-year respite in which to phase out this type of health care policy.

    It will enable the Department of Health to investigate low-cost health care options and guidelines further.

    Regulation Deadlines – Health Insurance Products

    Existing Long Term Insurance Act health policies will have to comply with the new regulations and will become effective in April. It will apply to all new policies, renewed policies and those subject to changes in benefits.

    Existing Short-Term Insurance Act policies which cover accident and health issues will have to adhere to the new regulations by the beginning of 2018.

    Also, according to Government, consumers will enjoy better protection with the introduction of the new regulations.

    Three demarcation categories – Health Insurance Products

    • Gap Cover – shortfalls between medical aid tariff ceilings and charges imposed by the medical profession
    • Hospital Cash Plans – stated benefit pay-outs when hospitalised
    • Primary Health Care Insurance – visits to the doctor, dentistry, optometry, emergency medical care, acute and chronic medication


    So the demarcation process has been the subject of extensive consultations involving stakeholders, the Departments of Health and Finance, The Financial Services Board and the Council for Medical Schemes.


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    All info was correct at time of publishing