Insurance protects a family's 'economic backbone'

More than 290,000 rural families living in poverty across China have been included in a free health insurance program that protects the main breadwinner.

The program, called "Dingliangzhu", pays out for treatments and conditions not covered by the basic medical insurance offered by local governments, according to Liu Wenkui, vice-president of the China Foundation for Poverty Alleviation.

He said the goal is to protect a family's "economic backbone" and prevent them slipping further into poverty due to the burden of hospital bills.

"The policy is expected to greatly relieve medical expenditure for poor families in the event of major diseases, as well as help families to recover so that they continue to generate an income," he added.

Liu's foundation introduced the insurance program on July 12 in partnership with e-commerce giant Alibaba Group and its financial arm Ant Financial. By 2020, the foundation is expected to cover 10 million people aged between 20 and 60.

The project is funded by public donations made through online platforms operated by the two technology companies, while claims are handled by three insurance companies.

By the end of November, more than 15 million yuan ($2.27 million) in donations had been collected, according to the foundation.

Those included in the program can have about 80 percent of any medical costs not covered by the government's basic insurance reimbursed, with the limit set at 100,000 yuan a year. The application and claims procedures can also be completed online, to save time, Liu said.

Sickness is a major root cause of poverty. Statistics provided by the foundation show that roughly 40 percent of the 50 million people living below the poverty line in China in 2015 were in that situation because of health issues and related medical expenses.

The foundation has cooperated with Alibaba before on poverty alleviation projects.

In 2012, they encouraged the public to donate toward the cost of delivering "love packages" - including stationery, daily necessities and clothes - to primary school students in underdeveloped counties nationwide.

By early July, the project had received 117 million yuan, benefiting 1.1 million primary school students, according to the foundation.

The number of people living in poverty in China decreased from nearly 100 million in 2012 to 43 million last year. The central government's goal is to eradicate poverty by 2020.