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Insurance for Expats in Hong Kong

Submitted: August 2013

Do not wait for problems to arise before reviewing your insurance arrangements. Once an accident has occurred, it is already too late.

A wide range of insurance products is available in Hong Kong, and expatriates may take out an international cover from a Hong Kong provider. International covers can be more expensive, but they are straightforward and they can spare you the need to have separate insurance policies (i.e. one in your home country and one in Hong Kong). Expats who frequently cross borders are more likely to need an international cover to achieve peace of mind.

Due to the wide range of products available, it is largely possible to tailor your insurance cover to your specific needs. If you are unclear about your cover or your needs whilst being in Hong Kong, you might wish to check your existing insurance arrangements in your country of origin.

If your needs happen to be fairly specific, you might need a specialist insurance provider.

 

Home insurance

Home insurance is divided into buildings insurance and contents insurance. You can also apply for joint cover.

A buildings insurance policy protects you against damage to your building. This may cover the costs of rebuilding your property from scratch or the costs of certain exceptional repairs, the alternative accommodation expenses while your property is rebuilt, and public liability if something happens in your home. On the other hand, a contents insurance policy covers your personal belongings only.

As for all insurance policies, it is up to you to decide how generous you want your cover to be, what the excess amounts are, which unexpected expenses are covered, etc. Additionally, your premiums may be lower if you take out your policy online.

Typically, you only need buildings insurance if you own your home. See Property Investment for Expats in Hong Kong However, you might need contents insurance, regardless of whether you own or rent your home. Hence, contents insurance may also be referred to as “renters insurance”.

Going away from home

If you expect to be away from your home for more than one month, you should let your insurer know. Failure to do so may result in a claim being rejected if something happens to your home whilst you are away.

 

Motor insurance

By law, you must have car insurance if you drive a car in Hong Kong, and your policy must include at least third party cover. Your vehicle cannot be registered in Hong Kong unless you have third party cover. Third party cover insures you against potential liabilities for third party car/property damage or bodily injury, but not damage or theft of your own car.

If you are victim of a car accident in Hong Kong, you must typically involve the police. Failure to do so may result in a claim being rejected, even if your vehicle has adequate insurance cover.

 

Other insurance

Private health insurance

Health insurance is strongly recommended as healthcare in Hong Kong is very expensive, unless you are eligible for subsidised healthcare at public facilities. The cut-off point is determined by your immigration status. If you don’t hold a Hong Kong ID card, you must generally go private. If you have a Hong Kong ID card, you might want to have peace of mind and be covered by private health insurance. See HEALTHCARE – National Health Service for Expats in Hong Kong.

To avoid disappointment, you should check if your cover is “sub-limited” or otherwise too basic to be satisfactory. These insurance covers can be ridiculously low in the eyes of many expatriates, and they do not exempt you from potentially ultra-high out-of-pocket costs. This basic-cover-only practice is widespread amongst Hong Kong employers. Thus, it is essential that you check the terms of your policy if your employer provides you with health insurance.

If you expect a baby, do check if maternity care is included in your cover, as costs can potentially run into well above HKD100,000. See HEALTHCARE – Doctors and Hospitals for Expats in Hong Kong.

Employer-provided health insurance is not a taxable benefit in kind to the extent that it is not easily convertible into cash.

Life insurance

Life insurance can be particularly helpful if your family is financially very dependent on you, as it may guarantee the payment of a lump sum to your family if you die.

Do assess carefully the burden of retaining foreign life insurance cover while you are resident in Hong Kong. Check also the geographical extent of your existing life insurance policy when you move across borders.

If you use a life insurance endowment policy (i.e. you use life insurance as an investment product), your investment gains are tax-free in Hong Kong. Foreign policies may be subject to foreign withholding taxes.

Domestic workers

If you hire anyone in Hong Kong, even a domestic helper like a maid or a nanny, you are responsible for any accident or injury in connection with your employees’ work. Thus, you might need employees’ compensation insurance (or business insurance).

 

 

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