JOHANNESBURG - The average life expectancy in South Africa is among the lowest in the world at 49.7 years. Once you reach the age of 65 years, however, your life expectancy soars to 90. Thanks to improving medical technology, many people are living longer. This also means there is an increased likelihood that, at some point, we will encounter a debilitating illness such as cancer, heart disease or a stroke that could have a lifelong impact not only on our health but also on our wealth.

Planning poorly for your health could mean that you need to fund a medical shortfall from other sources, such as your savings or retirement capital. There are three key considerations in planning holistically for your health to make sure you can go the distance, no matter what.

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1. Select medical scheme cover that suits your needs

While affordability is a key driver of option selection, options can have widely different structures. Selecting the most appropriate plan from the available options is essential because most schemes allow you to change options only once a year. It is important to consider your day-to-day benefits, the Prescribed Minimum Benefits and hospital cover. It is also a good idea to seek assistance from an adviser accredited with the Council for Medical Schemes.

2. Consider the gaps

Reducing your overall costs when selecting your medical plan is tempting, but you need to consider the gaps in what is covered by the plan you choose. Often, general practitioners and specialists charge higher rates than what a medical scheme covers, and you need to consider how to fund such shortfalls without putting yourself under financial strain. These additional costs could run into tens of thousands of rands (for example, if you are involved in an accident). 

Gap cover policies help to fund the shortfall between what your medical scheme pays and what specialists and doctors charge. Certain gap cover plans will pay up to five times, or 500%, of what your medical scheme has paid, with an overall limit of R150 000 per insured person per annum. Cover is typically restricted to in-hospital procedures, but some out-patient services are also covered.

3. Ensure you have a safety net in place

Unforeseen events such as rehabilitation after a stroke or cancer treatment can result in a need for specialised care, and you may lose your income if you are not able to work while undergoing treatment. Dread disease (severe illness cover) and income protection policies can ensure that you have access to funds to pay for specialised care and cover basic living expenses while you recover.

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Not taking a holistic approach when considering your long-term health could have disastrous financial consequences for you and your family, and could jeopardise your ability to ensure sufficient retirement funding. Prevention is better than cure.

Shreekanth Sing is technical legal adviser at PSG Wealth.