Insiders in the "sector" confirmed the decline in prices due to competition
Companies seeking to reduce health insurance benefits to reduce costs
Insurance companies assured that there is no reduction in benefits regarding basic coverage. Photography: Ashok Verma
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Directors and workers in the insurance sector said that some companies have resorted to reducing health insurance costs for their employees during their renewal of contracts during the recent period, by reducing the benefits schedule, noting that prices have witnessed a decline, finally, as they are at low levels due to competition.
They stated to Emirates Today that for some companies that have a good record, in terms of the small number of claims, they can get a reduction from the insurance company during the renewal.
Alternatives
In detail, the CEO of Dubai Islamic Insurance and Reinsurance (Aman), Jihad Vitrouni, said that some companies have resorted to reducing health insurance costs for their employees while renewing contracts during the recent period, pointing out that this included reducing the benefits schedule.
Vitrouni added that companies, like other global markets, resorted during the Corona pandemic to searching for alternatives to reduce their operational costs, indicating that this may contribute to a decline in the volume of health insurance premiums during the current year.
Profit margin
For his part, CEO and Managing Director of Al-Etihad Insurance Company, Abdulmutallab Al-Jaidi, said that a limited percentage of companies resorted to reducing health insurance costs by reducing benefits, pointing out that health insurance rates are still low, due to competition between companies.
Al-Jaidi stated that prices are useless for insurance companies, given that the profit margin, if any, is negligible, indicating that prices will remain at these levels as competition continues.
He emphasized that legislation, alone, would play a role in limiting competition in the market.
Great benefits
In turn, the CEO of the Orient Insurance Company, Omar Al-Amin, said that regarding basic coverage, there is no reduction in benefits, but it may affect health insurance programs that have great benefits and extend their geographical coverage to global regions, stressing that competition in prices is still big.
Al-Amin added, "Because of the conditions and the volume of business in the market, companies seek to maintain their market share," explaining that "competition is concentrated in the health and auto insurance sectors, because the bulk of their business does not require reinsurance with international companies."
He expected insurance premiums to maintain their rates during the current year, indicating that current indicators are better, compared to March and April.
Service providers
In the same context, the General Manager of "Getaway International Assurance", George Al-Ashqar, said that health insurance rates have witnessed a decline during the recent period, and they are at low levels due to competition, indicating that the costs are also related to the prices of medical service providers.
Al-Ashqar explained that some companies require reducing the costs of insurance contracts upon renewal, as part of controlling operational costs, pointing out that due to the low profit margins, there is no great flexibility in adjusting health insurance rates.
hardship
In addition, the regional director of AXA Gulf, Issam Maslamani, considered that it is natural for companies to resort to reducing their operational costs and controlling them, including health insurance, when they are under financial hardship, pointing out that for some companies that have a good record In terms of fewer claims, she can get a discount from the insurance company during the renewal.
Maslamani said that for companies that have many claims and caused losses to the insurance company, they have one option, which is to reduce the benefits schedule for employees, pointing out that contract renewal is subject to several factors, which insurance companies take into consideration.
He stressed that, like other sectors, health insurance is also witnessing competition between companies.