** Insurance: You'll get scammed if you don't know this (Part 4. Preparing the 3 Major Diagnosis Funds, Cancer Insurance) **

In Part 3, I tried to explain insurance for cancer, brain, and heart, but I ended up only talking about appropriate premiums... so I'll continue right from here. Don't forget that the purpose of preparing cancer, brain, and heart diagnosis funds is to prepare at least one year's worth of annual salary so that you can focus on treatment and maintain your annual income to cover loan repayments, fixed expenses, childcare costs, etc., even if your income stops!
1. Cancer Insurance
Naturally, the basis of cancer insurance is to sign up so that all types of cancer are covered. Cancer can be broadly classified into four categories: High-cost cancer, General cancer, Similar cancer, and Gender-specific cancer. The standard we usually suggest for preparing one year's worth of annual salary is General cancer.
- High-cost Cancer
These are called high-treatment-cost cancers, and while the scope may vary slightly by insurer, they usually include brain cancer, bone marrow cancer, leukemia, pancreatic cancer, esophageal cancer, gallbladder cancer, and bile duct cancer. These belong to cancers that require high treatment costs, are difficult to cure, and require long-term treatment.
Basically, even if you don't prepare for high-cost cancer separately, it is included in general cancer, so if you prepare a general cancer diagnosis fund, you can receive the insurance payout. However, one year's worth of annual salary from a general cancer diagnosis fund might be insufficient when treating high-cost cancer. High-cost cancers may require much longer treatment or incur much higher medical expenses. Therefore, if you also prepare for high-cost cancer, you can secure about two years' worth of annual salary by receiving both the high-cost cancer diagnosis fund and the general cancer diagnosis fund when diagnosed.
- General Cancer
General cancer covers the widest range of cancer diagnosis funds. Common cancers like stomach cancer and colon cancer fall into this category. Therefore, we design it so that you can maintain one year's worth of income in case of an emergency by signing up for an amount equal to one year's salary!
- Similar Cancer (Small-sum Cancer)
The third category is what we call "similar cancer" or "small-sum cancer." You can think of these as cancers with low treatment costs. They are cancers that are not difficult to treat and do not require much medical expense. This includes skin cancer, borderline tumors, carcinoma in situ, etc., including thyroid cancer, which is most common in women.
However, just because it's a relatively easy-to-treat cancer doesn't mean we can say to someone with thyroid cancer, "It's no big deal~." Since cancer is cancer, in the past, people often signed up for similar cancer coverage at the same level as general cancer. However, since 2022, coverage for similar cancer diagnosis funds can only be up to 20% of the general cancer diagnosis fund.
This 20% limit was implemented after the Financial Supervisory Service noted that there was excessive marketing for similar cancers, which do not require massive treatment costs. So, if you sign up for 50 million KRW in general cancer coverage, you can only sign up for 10 million KRW in similar cancer coverage. While I think there is some logic to this, it is a bit disappointing that you cannot sign up for more even if you want to.
- Gender-specific Cancer
Lastly, gender-specific cancer refers to prostate cancer for men and breast cancer for women. In most insurance policies, these are included in general cancer. However, in some policies, general cancer and gender-specific cancer are separated, so you must be careful not to miss them. If general cancer and gender-specific cancer are separated and you do not add a gender-specific cancer rider, you will not receive the insurance payout if you are diagnosed with that cancer. This could be a major problem.
Designing your coverage so that all cancers—high-cost, general, similar, and gender-specific—are included is the absolute basic of cancer insurance. Also, "Integrated Cancer" and "Metastatic Cancer" riders are coming out a lot lately, but I don't recommend them! Integrated cancer is a form where various cancers are classified by part, and there is a diagnosis fund for each part. For example, if they are classified as Stomach/Esophageal cancer and Breast/Urogenital/Adrenal/Endocrine cancer, etc., you get a payout once if you get esophageal cancer and another payout if you get breast cancer.
Usually, general cancer diagnosis funds pay out only once and then expire, so the advantage of integrated cancer is that you can receive it multiple times. However, integrated cancer does not cover metastatic cancer and is quite expensive. Rather than paying a high price to prepare for the possibility of getting cancer 2 or 3 times, I think it's better to prepare more broadly for other diseases.
Of course, it is true that it's good to be able to cover a second or third cancer, and if you have a metastatic cancer rider, you can cover metastatic cancer, but it becomes that much more expensive, so it can be disappointing in terms of efficiency. Since "Major Cancer Treatment Cost" riders allow for repeated treatment and can cover metastatic cancer, recurrent cancer, etc., I tend to recommend the Major Cancer Treatment Cost rider more.
A Major Cancer Treatment Cost rider is a rider that pays out treatment costs every year if you undergo cancer treatment such as surgery, chemotherapy, or radiation therapy after a cancer diagnosis. It covers payouts regardless of whether it is metastatic or recurrent cancer, and you can receive compensation every year for as long as you live after the diagnosis. While a diagnosis fund disappears once received, the major treatment cost can be received repeatedly every year, so it is very popular. You can design it for up to 150 million KRW per year, so if you receive treatment for 2 years, it becomes 300 million KRW, and for 3 years, it becomes 450 million KRW. It can also cover cancers that occur later after being cured.
In particular, chemotherapy is very important for cancer. As new medical technologies continue to emerge, treatments not supported by National Health Insurance are constantly increasing. Generally, the chemotherapy we know is a very strong drug that attacks not only cancer cells but also normal cells, causing hair loss, weight loss, and various side effects.
Modern treatments such as Targeted Therapy (chemotherapy that selectively targets only cancer cells) / Immunotherapy (chemotherapy that strengthens the body's own immunity) / Heavy Ion Therapy (a new medical radiation therapy only available at Yonsei Severance Hospital in Korea) have increased cancer treatment capabilities and reduced side effects, but they are very expensive because they are not covered by health insurance.
And these expensive treatments cannot be resolved even with Indemnity Insurance (Silbi). Some people occasionally think, "Isn't indemnity insurance invincible?" but indemnity insurance covers up to 250,000 KRW for outpatient visits and up to 50 million KRW for hospitalization. So, people think they can just get treated while hospitalized. However, since chemotherapy involves administering drugs or radiation, it does not take a long time, so hospitalization is often not possible. With the current shortage of hospital beds, it is practically impossible for people receiving these treatments to get a prescription for hospitalization.
Therefore, even if you claim indemnity insurance... the maximum reimbursement is 250,000 KRW. Among the most commonly used immunotherapy drugs, there is a drug called Keytruda, which has been the number one selling drug worldwide every year since 2023. It is mainly used for lung cancer and is administered via injection once every two weeks. But the cost per session is 5.6 million KRW. Even if you claim indemnity insurance, only the outpatient limit of 250,000 KRW is reimbursed, so you must pay 5.35 million KRW out of pocket.
In addition to this, Heavy Ion Therapy, which shows a nearly 100% cure rate for male prostate cancer, is only available at one place in Korea, Yonsei Severance Hospital, and the treatment cost is 50 to 70 million KRW. In particular, since the entire treatment cost must be paid on the first day of treatment for Heavy Ion Therapy, you must pay a large amount of 50 to 70 million KRW at once. Because these expensive treatments are non-reimbursable (uncovered by insurance), situations can arise where the consumer must bear the full cost, which is why we prepare by adding only these high-cost treatments to our insurance.
You can individually prepare for expensive non-reimbursable treatments like Targeted Therapy riders or Immunotherapy riders, or you can prepare broadly with a Major Cancer Treatment Cost rider (everything can be covered within the Major Cancer Treatment Cost rider). These days, I think Major Cancer Treatment Cost is more important than a cancer diagnosis fund.
In particular, Moderna recently announced positive results in the development of personalized mRNA cancer treatments tailored to a patient's cancer genetic mutations. Once this is completed, patients may receive customized treatments. When such new medical technologies emerge, they will be extremely expensive. Therefore, since Major Cancer Treatment Cost covers new medical technologies as well, it is important to prepare so that it can include treatments that will continue to develop in the future.
Um... I need to talk about the brain and heart as well, but the cancer part has become too long. It seems like I always have too much to say whenever I write. I will wrap up the 3 Major Diagnosis Funds in the next session while talking about the brain and heart!
- Check previous posts
Part 1: Renewable vs. Non-renewable
https://mlbpark.donga.com/mp/b.php?b=bullpen&id=202608310118356921
Part 2: Pure Protection vs. Savings Type
https://mlbpark.donga.com/mp/b.php?b=bullpen&id=202609010118370085
Part 3: 3 Major Diagnosis Funds (Cancer, Heart, Brain)
https://mlbpark.donga.com/mp/b.php?b=bullpen&id=202609020118392147