Hang on to Medical Insurance

May 25 - When the going gets tough, one of the first things that the public reaches out to cut back on is insurance cover.

But while this may seem like a good 'quick-fix' solution, the fact of the matter is that by downgrading or canceling medical insurance altogether, consumers are actually exposing themselves to much higher risks in the long run.

In addition, a good percentage of medical health insurance benefits are actually tax deductible, which could mean that the cover costs less than what consumers believe.

"Our basic message is to retain your medical aid cover if it's at all financially feasible to do so," said the principal officer of Resolution Health Medical Scheme, Mark Arnold.

"While this obviously affects cash flow in the short term, a large proportion of medical expenses are deductible in a given tax year and it's obviously far preferable to remain covered for medical costs until those deductions begin to filter through."

A family of four, according to Arnold, could easily benefit from just over R2,100 per month in deductions.

The member of the medical scheme and first dependent receives up to R670 per month, while subsequent dependents receive R410 per month each.

"The fundamental fact is that medical expenses for individuals are already substantially tax deductible and maintaining your medical aid membership is crucially important against the backdrop of rising medical costs and the questionable alternative of being reliant upon the state health system," said Arnold.