/ investment

Joining insurance or not?

After so much taught whether I should take another insurance or not, I've come to this conclusion.  My previous insurance is already 4 years, and this month is the insurance birthday.

I guess there will be no better time to tell other my experience in insuring myself.  I will gave you an illustration based on my experience.  Yours may vary, but for most people on my age - 28 in 2012 - we don't take a lot of hospitalisation anyway. 

For the past 4 years there are two big spening on my healthcare that can be covered by insurance.  Caught a really bad flu and viruses and other minor illness that costs around IDR 600.000 per treatment, totalling 2.400.000 for 4 years, then a days surgery that costs IDR 5.900.000,00, kidney stone problem due to melanin enriched milk that I drank back in 2006-2007 and that kicks in last week, costs IDR 6.800.000,00 for two nights admissions in a VIP room.  So they totals IDR 15.100.000,00. 

Please note that day surgery are not covered by insurance.

Minor illness treatmentsIDR 2.400.000,00
Day SurgeryIDR 5.900.000,00
Kidney Stone Problem IDR 6.800.000,00
TotalIDR 15.100.000,00

That roughly translates to USD 1650. 

The thing is: shall we insure ourself?  I will give you the data and comparison.  With my previous insurance, I pay IDR 500.000 a month or 55 USD a month.   


Under your bed means you put the money in the bank or somewhere else that it got no interests. 

Most insurance company will say the advantages can be felt after 10 years.  You'll see on data and analysis.  There are two insurnace that I put in the comparison one will cover 100% of your bills and the other will cover 50% of your bills.  You need to be extraordinary lucky to get an insurance that covers 100% of your bills.  The insurance returns you 0.5 percent a month.  In the first year insurance company invested 20% of my money, second year 40%, third year 60%, fourth year 80% and final year 100% to mutual funds.

The mutual funds will return you 1% a month on average.

Based on my experience, 1 time hospitalised in 4 years and several day cares, therI make an estimate of 2 hospitalisation and 3 day cares in 10 years and every two years they increase in bill by IDR 1.000.000, well thats because I haven trouble in estimating healthcare bill inflation.   Feel free to play with the file here, available for download (Excel 2010 format), and checked to be virus free.  If you don't have Excel 2010 installed, well, you can still read the data below.

M100% Cover Ins50% Cover InsMutual FundsUnder PillowHospital Bill
1IDR 100,000.00IDR 100,000.00IDR 500,000.00IDR 500,000.00
2IDR 200,500.00IDR 200,500.00IDR 1,005,000.00IDR 1,000,000.00
3IDR 301,502.50IDR 301,502.50IDR 1,515,050.00IDR 1,500,000.00
4IDR 403,010.01IDR 403,010.01IDR 2,030,200.50IDR 2,000,000.00
5IDR 505,025.06IDR 505,025.06IDR 2,550,502.51IDR 2,500,000.00
6IDR 607,550.19IDR 607,550.19IDR 3,076,007.53IDR 3,000,000.00
7IDR 710,587.94IDR 710,587.94IDR 3,606,767.61IDR 3,500,000.00
8IDR 814,140.88IDR 814,140.88IDR 4,142,835.28IDR 4,000,000.00
9IDR 918,211.58IDR 918,211.58IDR 4,684,263.63IDR 4,500,000.00
10IDR 1,022,802.64IDR 1,022,802.64IDR 5,231,106.27IDR 5,000,000.00
11IDR 1,127,916.65IDR 1,127,916.65IDR 5,783,417.33IDR 5,500,000.00
12IDR 1,233,556.24IDR 1,233,556.24IDR 6,341,251.51IDR 6,000,000.00
13IDR 1,439,724.02IDR 1,439,724.02IDR 6,904,664.02IDR 6,500,000.00
14IDR 1,646,922.64IDR 1,646,922.64IDR 7,473,710.66IDR 7,000,000.00
15IDR 1,855,157.25IDR 1,855,157.25IDR 8,048,447.77IDR 7,500,000.00
16IDR 2,064,433.04IDR 2,064,433.04IDR 8,628,932.25IDR 8,000,000.00
17IDR 2,274,755.20IDR 2,274,755.20IDR 9,215,221.57IDR 8,500,000.00
18IDR 2,486,128.98IDR 2,486,128.98IDR 9,807,373.78IDR 9,000,000.00
19IDR 2,698,559.62IDR 2,698,559.62IDR 10,405,447.52IDR 9,500,000.00
20IDR 2,912,052.42IDR 2,912,052.42IDR 11,009,502.00IDR 10,000,000.00
21IDR 3,126,612.68IDR 3,126,612.68IDR 11,619,597.02IDR 10,500,000.00
22IDR 3,342,245.75IDR 3,342,245.75IDR 12,235,792.99IDR 11,000,000.00day care
23IDR 3,558,956.98IDR 3,558,956.98IDR 12,858,150.92IDR 11,500,000.00IDR 8,000,000.00
24-IDR 4,223,248.24-IDR 4,223,248.24IDR 5,486,732.43IDR 4,000,000.00
25-IDR 3,944,364.48-IDR 3,944,364.48IDR 6,041,599.75IDR 4,500,000.00
26-IDR 3,664,086.30-IDR 3,664,086.30IDR 6,602,015.75IDR 5,000,000.00
27-IDR 3,382,406.73-IDR 3,382,406.73IDR 7,168,035.91IDR 5,500,000.00
28-IDR 3,099,318.77-IDR 3,099,318.77IDR 7,739,716.26IDR 6,000,000.00
29-IDR 2,814,815.36-IDR 2,814,815.36IDR 8,317,113.43IDR 6,500,000.00
30-IDR 2,528,889.44-IDR 2,528,889.44IDR 8,900,284.56IDR 7,000,000.00
31-IDR 2,241,533.89-IDR 2,241,533.89IDR 9,489,287.41IDR 7,500,000.00
32-IDR 1,952,741.55-IDR 1,952,741.55IDR 10,084,180.28IDR 8,000,000.00
33-IDR 1,662,505.26-IDR 1,662,505.26IDR 10,685,022.08IDR 8,500,000.00
34-IDR 1,370,817.79-IDR 1,370,817.79IDR 11,291,872.31IDR 9,000,000.00
35-IDR 1,077,671.88-IDR 1,077,671.88IDR 11,904,791.03IDR 9,500,000.00
36-IDR 783,060.24-IDR 783,060.24IDR 12,523,838.94IDR 10,000,000.00
37-IDR 386,975.54-IDR 386,975.54IDR 13,149,077.33IDR 10,500,000.00
38IDR 11,089.58IDR 11,089.58IDR 13,780,568.10IDR 11,000,000.00
39IDR 411,145.03IDR 411,145.03IDR 14,418,373.78IDR 11,500,000.00
40IDR 813,200.76IDR 813,200.76IDR 15,062,557.52IDR 12,000,000.00
41IDR 1,217,266.76IDR 1,217,266.76IDR 15,713,183.10IDR 12,500,000.00
42IDR 1,623,353.09IDR 1,623,353.09IDR 16,370,314.93IDR 13,000,000.00
43IDR 2,031,469.86IDR 2,031,469.86IDR 17,034,018.08IDR 13,500,000.00
44IDR 2,441,627.21IDR 2,441,627.21IDR 17,704,358.26IDR 14,000,000.00
45IDR 2,853,835.35IDR 2,853,835.35IDR 18,381,401.84IDR 14,500,000.00
46IDR 3,268,104.52IDR 3,268,104.52IDR 19,065,215.86IDR 15,000,000.00admission
47IDR 3,684,445.04IDR 3,684,445.04IDR 19,755,868.02IDR 15,500,000.00IDR 7,000,000.00
48IDR 4,102,867.27IDR 602,867.27IDR 13,453,426.70IDR 9,000,000.00
49IDR 4,623,381.61IDR 1,105,881.61IDR 14,087,960.96IDR 9,500,000.00
50IDR 5,146,498.51IDR 1,611,411.01IDR 14,728,840.57IDR 10,000,000.00
51IDR 5,672,231.01IDR 2,119,468.07IDR 15,376,128.98IDR 10,500,000.00
52IDR 6,200,592.16IDR 2,630,065.41IDR 16,029,890.27IDR 11,000,000.00
53IDR 6,731,595.12IDR 3,143,215.74IDR 16,690,189.17IDR 11,500,000.00
54IDR 7,265,253.10IDR 3,658,931.82IDR 17,357,091.06IDR 12,000,000.00
55IDR 7,801,579.36IDR 4,177,226.47IDR 18,030,661.97IDR 12,500,000.00
56IDR 8,340,587.26IDR 4,698,112.61IDR 18,710,968.59IDR 13,000,000.00
57IDR 8,882,290.20IDR 5,221,603.17IDR 19,398,078.28IDR 13,500,000.00
58IDR 9,426,701.65IDR 5,747,711.19IDR 20,092,059.06IDR 14,000,000.00
59IDR 9,973,835.16IDR 6,276,449.74IDR 20,792,979.65IDR 14,500,000.00
60IDR 10,523,704.33IDR 6,807,831.99IDR 21,500,909.45IDR 15,000,000.00
61IDR 11,076,322.85IDR 7,341,871.15IDR 22,215,918.54IDR 15,500,000.00
62IDR 11,631,704.47IDR 7,878,580.51IDR 22,938,077.73IDR 16,000,000.00
63IDR 12,189,862.99IDR 8,417,973.41IDR 23,667,458.51IDR 16,500,000.00
64IDR 12,750,812.31IDR 8,960,063.28IDR 24,404,133.09IDR 17,000,000.00
65IDR 13,314,566.37IDR 9,504,863.59IDR 25,148,174.42IDR 17,500,000.00
66IDR 13,881,139.20IDR 10,052,387.91IDR 25,899,656.17IDR 18,000,000.00
67IDR 14,450,544.89IDR 10,602,649.85IDR 26,658,652.73IDR 18,500,000.00
68IDR 15,022,797.62IDR 11,155,663.10IDR 27,425,239.25IDR 19,000,000.00
69IDR 15,597,911.61IDR 11,711,441.41IDR 28,199,491.65IDR 19,500,000.00
70IDR 16,175,901.17IDR 12,269,998.62IDR 28,981,486.56IDR 20,000,000.00day care
71IDR 16,756,780.67IDR 12,831,348.61IDR 29,771,301.43IDR 20,500,000.00IDR 9,000,000.00
72IDR 8,340,564.57IDR 8,895,505.36IDR 21,569,014.44IDR 12,000,000.00
73IDR 8,882,267.40IDR 9,439,982.88IDR 22,284,704.59IDR 12,500,000.00
74IDR 9,426,678.73IDR 9,987,182.80IDR 23,007,551.63IDR 13,000,000.00
75IDR 9,973,812.13IDR 10,537,118.71IDR 23,737,627.15IDR 13,500,000.00
76IDR 10,523,681.19IDR 11,089,804.31IDR 24,475,003.42IDR 14,000,000.00
77IDR 11,076,299.59IDR 11,645,253.33IDR 25,219,753.46IDR 14,500,000.00
78IDR 11,631,681.09IDR 12,203,479.59IDR 25,971,950.99IDR 15,000,000.00
79IDR 12,189,839.50IDR 12,764,496.99IDR 26,731,670.50IDR 15,500,000.00
80IDR 12,750,788.70IDR 13,328,319.48IDR 27,498,987.21IDR 16,000,000.00
81IDR 13,314,542.64IDR 13,894,961.08IDR 28,273,977.08IDR 16,500,000.00
82IDR 13,881,115.35IDR 14,464,435.88IDR 29,056,716.85IDR 17,000,000.00
83IDR 14,450,520.93IDR 15,036,758.06IDR 29,847,284.02IDR 17,500,000.00
84IDR 15,022,773.53IDR 15,611,941.85IDR 30,645,756.86IDR 18,000,000.00
85IDR 15,597,887.40IDR 16,190,001.56IDR 31,452,214.43IDR 18,500,000.00
86IDR 16,175,876.84IDR 16,770,951.57IDR 32,266,736.57IDR 19,000,000.00
87IDR 16,756,756.22IDR 17,354,806.33IDR 33,089,403.94IDR 19,500,000.00
88IDR 17,340,540.00IDR 17,941,580.36IDR 33,920,297.98IDR 20,000,000.00
89IDR 17,927,242.70IDR 18,531,288.26IDR 34,759,500.95IDR 20,500,000.00
90IDR 18,516,878.92IDR 19,123,944.70IDR 35,607,095.96IDR 21,000,000.00
91IDR 19,109,463.31IDR 19,719,564.42IDR 36,463,166.92IDR 21,500,000.00
92IDR 19,705,010.63IDR 20,318,162.25IDR 37,327,798.59IDR 22,000,000.00
93IDR 20,303,535.68IDR 20,919,753.06IDR 38,201,076.58IDR 22,500,000.00
94IDR 20,905,053.36IDR 21,524,351.82IDR 39,083,087.34IDR 23,000,000.00admission
95IDR 21,509,578.63IDR 22,131,973.58IDR 39,973,918.22IDR 23,500,000.00IDR 8,000,000.00
96IDR 22,117,126.52IDR 18,742,633.45IDR 32,873,657.40IDR 16,000,000.00
97IDR 22,727,712.15IDR 19,336,346.62IDR 33,702,393.97IDR 16,500,000.00
98IDR 23,341,350.71IDR 19,933,028.35IDR 34,539,417.91IDR 17,000,000.00
99IDR 23,958,057.47IDR 20,532,693.49IDR 35,384,812.09IDR 17,500,000.00
100IDR 24,577,847.75IDR 21,135,356.96IDR 36,238,660.21IDR 18,000,000.00
101IDR 25,200,736.99IDR 21,741,033.74IDR 37,101,046.82IDR 18,500,000.00
102IDR 25,826,740.68IDR 22,349,738.91IDR 37,972,057.28IDR 19,000,000.00
103IDR 26,455,874.38IDR 22,961,487.61IDR 38,851,777.86IDR 19,500,000.00
104IDR 27,088,153.75IDR 23,576,295.04IDR 39,740,295.64IDR 20,000,000.00
105IDR 27,723,594.52IDR 24,194,176.52IDR 40,637,698.59IDR 20,500,000.00
106IDR 28,362,212.49IDR 24,815,147.40IDR 41,544,075.58IDR 21,000,000.00
107IDR 29,004,023.56IDR 25,439,223.14IDR 42,459,516.33IDR 21,500,000.00
108IDR 29,649,043.67IDR 26,066,419.26IDR 43,384,111.50IDR 22,000,000.00
109IDR 30,297,288.89IDR 26,696,751.35IDR 44,317,952.61IDR 22,500,000.00
110IDR 30,948,775.34IDR 27,330,235.11IDR 45,261,132.14IDR 23,000,000.00
111IDR 31,603,519.21IDR 27,966,886.28IDR 46,213,743.46IDR 23,500,000.00
112IDR 32,261,536.81IDR 28,606,720.72IDR 47,175,880.89IDR 24,000,000.00
113IDR 32,922,844.49IDR 29,249,754.32IDR 48,147,639.70IDR 24,500,000.00
114IDR 33,587,458.72IDR 29,896,003.09IDR 49,129,116.10IDR 25,000,000.00
115IDR 34,255,396.01IDR 30,545,483.11IDR 50,120,407.26IDR 25,500,000.00
116IDR 34,926,672.99IDR 31,198,210.52IDR 51,121,611.33IDR 26,000,000.00
117IDR 35,601,306.36IDR 31,854,201.57IDR 52,132,827.45IDR 26,500,000.00
118IDR 36,279,312.89IDR 32,513,472.58IDR 53,154,155.72IDR 27,000,000.00day care
119IDR 36,960,709.45IDR 33,176,039.94IDR 54,185,697.28IDR 27,500,000.00IDR 10,000,000.00
120IDR 27,645,513.00IDR 28,841,920.14IDR 45,227,554.25IDR 18,000,000.00


After analysing the data, I can conclude that there is no use to join the insurance.  Parking your funds in mutual funds yields better result even with ever increasing hospital bill.  Why?  Insurance expires when you reach 75 years old, and chances are most of us will live beyond 75, provided we care our health and exercises regularly. 

Second after you are 75, your health will falling and you will need more money to very the healthcare bill without any insurance.  With mutual funds, your will got more money in your account with insurance.

Also, please note after 10 years and all the inflations, don't you ever think that the hospital bill will always be the same?  By that time the insurance won't increase your cover.  Also please note the small prints: they might not cover you when you get sick too much as they got limits on how much they should cover you.  Insuring IDR 500.000,00 a month, most insurance won't cover your hospital bill after you spent IDR 35.000.000.  Therefore on year 12, you won't get any cover left which means you are not covered.


Do not take insurance.  Park your funds in mutual funds, or under your bed (they grow faster for 8 years anyway).

If you are Indonesian, I know it is not hard to save IDR 500.000 a month for mutual funds.  It is the price of a good meal here.  Just the discipline which is hard.  If you can't afford IDR 500.000 a month, try on a smaller amount of money.  The calculation was based on VIP health care on an international hospital.  If you can only afford say, IDR 250.000 a month, well, you can make it in local hospital anyway.

But if and only if you can't be make yourself discipline and can't see that you got a lot of money in your mutual funds, insurance is the best option for you then.

If you are from overseas and you see the price healthcare bill in Indonesia is cheap, here is the calculation:

The price of hospitalisation is IDR 600.000,00 (around 65 USD) per day for VIP room in an international hospital in Indonesia.  Believe me, the room is as nice as European 4 star hotel room and their doctor are experienced and their nurses too (that means old aunty style nurses).

The consulting fees for GP in Indonesia is IDR 100.000,00 (10 bucks) and for specialist is IDR 200.000,00 (20 bucks) per visit.

The costs of medicine is about the same in Indonesia and overseas.  If you are on VIP, the doctor will gave you patented medicine and they are all expensive.  Any room less luxurious than VIP ward will be given generic version of the drug, therefore lowering the drug price by 50%.

You can arrive in Indonesia to have medical check up or treatment.  There are several international hospitals and they treated you pretty well at low price.

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