UAE health insurance gets costlier for dependent parents
While news of soaring insurance prices might not be new, there’s been a peculiar rise in the cost of UAE health insurance for dependent parents specifically. Our recently released Cost of International Health Insurance Report for 2018 again shows Dubai ranking among the highest locations in the world, but a recent article in the Gulf News has brought further focus on the factors impacting premiums covering people over 65.
While mandatory DHA laws enforce a market where no one can be denied coverage, this article discusses the implications this is having on medical insurance prices in the region.
Changes to UAE health insurance plans covering dependent parents
According to industry players, the premium hike for dependent parents in Dubai has ranged from 20% to 70% for new policies and renewals. This has meant minimum premiums that were previously in the AED 2,500 range have now increased to as high as AED 4,000 and above. The rising costs of finding UAE health insurance for families, as outlined in our report, saw Dubai rise higher in the Top 20 list of average family plan premiums around the world.
Others have noted that the annual limits of the basic DHA policy (AED 150,000) have been offered as an individual dependent parents’ plan that imposes a six-month waiting period for anyone with a pre-existing condition. While the imposition counts for first scheme membership, policyholders will be covered in full once this first period is over; a somewhat flimsy reprieve for those aged 65 and older who are more likely to have one or more lingering health concerns.
What’s driving insurance prices for older persons in Dubai?
Our Cost of International Health Insurance Report, like our International Private Medical Insurance Inflation Report before it, highlighted the following key drivers behind rising insurance costs:
- Increased demand for international private care
- Rising costs of healthcare provision
- Increased regulatory impacts, such as stricter local licensing and mandatory cover
- Continued challenges with fraud
While all of these do have some bearing on the situation for the 65 and older market in Dubai, the high claims ratio in the UAE is also being fingered for blame. As the ramifications of mandatory cover become more clear, insurers are finding that the UAE health insurance coverage offered to those with dependents over 65 were resulting in poor claims ratios driven by the initial low premium price (particularly where the basic minimum plans were concerned).
How does this impact policyholders in Dubai?
For those with dependent parents, they may find that the premium for coverage has risen significantly. Some prices may be comparable to more comprehensive plans, which is something industry experts suggest consumers should be aware of. According to the Gulf News article, many dependents’ policies are not as comprehensive in their coverage, nor are they specifically relevant to senior patients.
A related concern is that these basic types of policies are being purchased primarily to satisfy mandatory health policy laws, rather than provide proper healthcare coverage. While the minimum coverage requirements mandated by the DHA do offer good benefit terms for the general consumer market, those aged 65 and over have a range of specific concerns and higher demands than someone in their mid-20s might. Whilst they might still be the cheaper option for those covering dependent parents, the increased premiums might not make it the best value solution.
Finally, any potential impact on the claims loss ratio to an insurer, from any particular product, puts pressure on the rest of their business and its pricing strategies. There’s no indication yet that insurers might look to offset losses covering seniors by hiking premiums on other consumer types, but not finding a way to provide good coverage at an attractive rate may leave the Dubai insurance industry with few options.
Working out what you should be paying for UAE health insurance
In order to know whether you’re paying too much or too little for the coverage you have means knowing the market. As individual consumers, the most common tools you have are online comparison websites or independent insurance brokers that can produce tables for you to check out what’s on offer. Pacific Prime Dubai prides itself on having a user friendly comparison tool, as well as knowledgeable and expert staff that will put you at the centre of any decision regarding your insurance coverage.
As well as that, our marketing team prepares a range of insightful industry reports that are aimed at empowering you with the sort of insider knowledge that can help you make better decisions about your health insurance in the future. In particular, our Cost of International Health Insurance Report is available to you free of charge and provides a comparison of the average cost of international coverage for both individuals and families, in 100 locations around the world.