State of Health Insurance in Latin America 2020-2021 Report

The State of
Health Insurance
2020-2021
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2 | Pacific Prime’s State of Health Insurance Report 2020-2021
ABOUT
THE REPORT
I’m extremely pleased to unveil Pacific Prime’s State of
Health Insurance Report 2020-2021. Now in its fourth
edition, the report offers key insights about global and
regional IPMI trends, and makes informed predictions
Neil Raymond about the sector moving forward.
CEO and Founder
Pacific Prime I’d like to take this opportunity to thank Pacific Prime’s
in-house insurance experts who have put together this
compendium of information from internal data collection
and sales insights, public reports, news articles, insurer
commentary, and more to provide an accurate snapshot
of the world of IPMI. In the report, you’ll discover:
• Overarching factors shaping the global insurance

sector, including the unprecedented COVID-19 pan-
demic, technological innovation occurring at break-
neck speed, and more
• Regional-specific trends and challenges, and their
impact on individuals, businesses, and employee
benefits
• Updates from Pacific Prime’s offices around the world
Pacific Prime’s State of Health Insurance Report 2020-2021 | 3
Report contributors
Andrew Merrilees Julian Mengual Pierre de Mirman

General Manager CEO Deputy CEO
Bupa Hong Kong Insurance South East Asia & Regional Pacific Prime
Health Solutions Cigna
To facilitate easy and digestable reading, this report is sectioned into two main parts. The first
addresses global trends and the second zooms into regional-specific information, as per the
table of content outlined on the next page.
I hope you gain a deeper understanding of the state of health insurance, and thoroughly
enjoy reading the report!
Disclaimer: This report is intended for general informational purposes only,

and is not a substitute for legal and/or medical advice.
Table of Contents
I. About the report ................................................................................. 2
II. Changes and trends shaping the global health insurance industry ....... 6
Insurance companies and clients continue to cope with the financial impact of COVID-19 . . . . . . . . . . . . . . 7
Most insurers will cover pandemic-related costs going forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Major healthcare trends and challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
The burden of delayed care is on the rise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
The burden of mental health conditions is expected to grow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
The pace of recovery varies across from country to country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
The COVID-19 pandemic brings health and wellness into the global spotlight . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Global healthcare and insurance costs are expected to increase in 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Consumer needs have evolved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Younger demographics are increasingly interested in health insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
People are expecting more from their healthcare experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Investing in the digital future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Phygital becomes the standard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
III. Regional changes and trends ............................................................. 27
Asia-Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
The Middle East and Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
The Americas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Appendix ................................................................................................ 66
CHANGES AND TRENDS

SHAPING THE GLOBAL
HEALTH INSURANCE
INDUSTRY
The COVID-19 pandemic continues to leave ripples across the health
insurance sector in 2021. It has sped up some innovations and eliminated the
need for others. To offer a bird’s eye view of the global trends, this section of the
report brings to light the most prominent macro factors shaping the global
insurance sector. Our analysis has been split into four sections for ease of
reading:
• Insurance companies and clients continue to cope with the financial impact
of COVID-19
• Major healthcare challenges and trends
• Impact of COVID-19 on the insurance industry
• Changing consumer needs and expectations for insurtech
Insurance companies and clients

continue to cope with the financial
impact of COVID-19
As vaccines roll out in various countries across the world, COVID-19’s financial impact is here
to stay. Consumers and businesses will continue to be affected by financial and economical
challenges brought forth by the novel coronavirus. One example is the rising unemployment
trend. Insurers will also struggle to manage the impact of COVID-19 in the long run. This
makes it imperative to identify and engage with clients facing pandemic-related hardships.
Having said that, insurers will need to navigate the tightening regulatory and reporting re-
quirements. This will all be against the backdrop of geopolitical tensions. For instance, premi-
ums in both the UK and Europe will be costly post-Brexit.
Meanwhile, more corporate clients are looking to optimize their plans. Budgets are scrutinized
and deployed to get the best-value insurance plan. Once again, member coinsurances come
out on top as the most popular cost-sharing option. On the bright side, the sector has suffered
far less economic and reputational damage than initially feared in the early days of the pan-
demic.
As the pandemic has evolved, so too have the needs of our

corporate clients and their employees. For our clients,
supporting a workforce that is suddenly working from home for
an extended period, and balancing work and the pressures of
home life has been challenging.
Julian Mengual
CEO, South East Asia & Regional Health Solutions at Cigna
Most insurers will cover pandemic -

related costs going forward
Typically, the majority of insurers tend to exclude coverage during a pandemic. Nevertheless,
COVID-19 has changed things. As the unprecedented health crisis is taking a massive toll on
our collective psyche, more and more insurers have begun removing pandemic-related exclu-
sions and refining program wording limitations in some countries.
In the post-COVID-19 world, most regions (with the exception of Europe) are expected to see
fewer pandemic-related exclusions.
Figure 1 - Pandemic-related exclusions pre- and post-COVID-19 globally

Pre-COVID-19 - Were claims arising from pandemics excluded from your policy?
0% 10% 20% 30% 40% 50% 60% 70% 80%
Yes
37%
48%
27%
35%
50%
No
63%
52%
73%
65%
50%
Global Latin America Asia-Pacific

Europe Middle East and Africa
Post-COVID-19 - Do you expect claims arising from pandemics to be excluded

from your policy wording?
0% 20% 40% 60% 80% 100%
Yes
30%
34%
8%
41%
27%
No
70%
66%
92%
59%
73%
Global Latin America Asia-Pacific

Europe Middle East and Africa
Source: Willis Tower Watson

Overall, it is expected that only 30% of insurers globally will exclude coverage during a
pandemic moving forward. The change is most significant in the Asia-Pacific, where a mere
8% will do so.
Pandemic-related exclusions on behalf of Asia-Pacific insurers:
Pre-COVID-19 Post-COVID-19
27% of insurers excluded coverage 8% of insurers are expected to exclude
during a pandemic coverage during a pandemic
Source: Willis Tower Watson’s 2021 Global Medical Trends Survey Report
Many countries have introduced COVID-19 insurance requirements for travelers

In fact, many countries have also introduced new COVID-19 insurance requirements for
travelers from abroad, stipulating that coverage for the novel coronavirus is mandatory for
entry. This is largely to protect national health systems, many of which are burdened to the
brink of collapse.
From Aruba to Ukraine and beyond, these new COVID-19 insurance requirements for
travelers have been met by dedicated policies on behalf of insurers that are specifically
designed to cover the pandemic. For example, insurers in Thailand are offering travelers
coverage for COVID-19 of up to USD $100,000 as per the Thai government’s mandate.
Major healthcare trends and challenges

2021 - a year of innovative healthcare trends and complex challenges - will be pivotal in shap-
ing the future of the healthcare industry. Here are the major health trends and challenges to
be aware of in 2021 and beyond.
Major healthcare trends
Digital acceleration and advances in technology will enhance telehealth and

further increase its popularity among all users from patients to medical
professionals and insurers globally.
Around the world, national health systems will adopt new frameworks and
review their operations as governments learn from the impacts of the COVID-19
pandemic.
As data becomes more usable, so will the world of genomics and gene editing
that will lead to breakthroughs in developing cures for a range of human
diseases.
The use of AI will improve efficiency and the speed at which breakthroughs are
made, such as the ability to detect and respond to future outbreaks.
Combining the outcomes of AI with blockchain technology will further facilitate

medical professionals in treating patients safely and efficiently.
Major healthcare challenges
Patients will demand more and more products and services that improve their
overall health outcomes and wellbeing. Healthcare providers will be wise in their
efforts and investments to develop the overall patient experience.
Nebulous cyber attackers are on the rise as consumers are becoming more
technologically active. Healthcare providers will need to pay more attention to
cybersecurity to avoid unprecedented fines, reputational damage, and loss of trust.
Securing the health supply chain will be a challenge for healthcare providers,
especially with most of the world still containing the pandemic and recovering
slowly.
Communication between individuals, organizations, and governments around

the world will be pivotal in managing ongoing and future healthcare
challenges. Robust communication systems for escalation and leadership from
decision-makers will be key in meeting the challenge of resolving problems
quickly and effectively.
The burden of delayed care is on the

rise
40% of individuals stated they have canceled upcoming

appointments [...] and an additional 12% reported that they
needed care but have not scheduled or received care.
McKinsey & Company
While the direct financial impact of COVID-19 has already been substantial, longer-term ef-
fects are starting to emerge. Fuelled by people’s reluctance or inability to undergo in-person
treatment, insurers are recognizing that the care people are going to require in the near future
will be significant.
The hardest-hit regions will be the ones with relatively stringent lockdowns and restrictions,
such as North America, where the financial impact of deferred care has the potential to dwarf
the immediate impact of COVID-19. In the US, for example, the effects of delayed care could
cost the healthcare system anywhere between USD $30 billion and USD $65 billion annually.
This could have significant trickle-down effects on insurers and health insurance costs in the
years to come.
According to Aetna International, many insurers will face the challenge of managing the long-
term impact of COVID-19. With this in mind, chronic disease management will likely become
a major priority as and when things return to normal, the main reason being that access to
adequate and ongoing medical treatment reduces members’ chances of developing compli-
cations further down the line.
The burden of mental health conditions

is expected to grow
What is mental health?

Mental health is an individual’s emotional, psychological, and
social wellbeing - affecting how they think, feel, and act. It
determines how they cope with stress, relate to others, and
make life choices.
Whether it’s the fear of getting COVID-19, financial worries amidst the economic crisis, or even
loneliness from social distancing and lockdown policies, the pandemic has caused mental
health to take a nosedive across the world. As individuals begin seeking treatment for this, the
burden of mental health conditions is expected to grow.
According to Willis Tower Watson’s 2021 Global Medical Trends Survey Report, four in ten re-
spondents predict that mental health conditions will be among the three most common con-
ditions affecting costs within the next 18 months (40%) and among the three most expensive
in the next 18 months (39%).
Mental health is largely a stigmatized issue, but there is more awareness in

developed countries
Mental health is stigmatized in much of the world, though it is more openly discussed in de-
veloped regions such as the UK, the US, Singapore, and Australasia. Therefore, despite the
increasing prevalence of mental health issues globally, the acknowledgement and treatment
of mental health conditions are more likely in countries that have awareness of the issue.
In these countries, the government has robust mental health policies. For example, the UK’s
NHS published a Mental Health Implementation Plan in 2019 to improve mental health
services. NHS England also made a commitment to a ring-fenced local investment fund worth
at least GBP £2.3 billion a year in real terms by 2023/24 for mental health services.
Given the impacts of the COVID-19 pandemic, the UK government has introduced a
Mental Health Recovery Plan, which pledges GBP £15 million to level up mental health
through funding initiatives in deprived local authority areas in England. Under the plan, eligible
local authorities will receive around GBP £500,000 each to fund prevention activities like:
Debt advice
Carers support
Outreach to people facing

loneliness and isolation
And more.
Telehealth and mental health: A trend accelerated by the COVID-19 pandemic
We’ve seen the need for mental health support as an area that
has really taken the spotlight in the agendas of our corporate
clients. By offering this care in an affordable way throughout
the pandemic via virtual consultations with counselors, social
workers, and psychologists, Cigna has been able to provide the
support people need in the comfort of their own home.
Julian Mengual
The fear of getting COVID-19, compounded by the fact that many healthcare systems were/
are on the brink of collapse, has prompted a rise in telehealth solutions. Interestingly, the
adoption of telehealth grew at a much faster rate for mental health conditions, as per what
CVS Health witnessed:
Virtual consultations for Virtual consultations for

mental health physical health
3,000% increase 400% increase
Source: Aetna International’s Expat and international employee health care trends 2021
The pace of recovery varies from

country to country
Different countries have different pace of recovery, largely due to factors such as the govern-
ment policies in response to the COVID-19 crisis and the public health response. As countries
continue to recover at their own pace, travel restrictions remain ongoing and vaccination pro-
grams are starting to give people hope. For the time being, movement is being impacted on a
global scale, thereby affecting IPMI’s target clients.
Expats appear to be more inclined to relocate back home amidst the COVID-19 pandemic for
various reasons. Now that traveling is not as easy as hopping on a flight and arriving hours
later, expats are more inclined to relocate back home to be with children and aging parents. A
survey from real estate agent Knight Frank found that 64% of participants said that lockdown
had affected their decision to purchase real estate in their home country.
Some of the main motivators behind moving back home include:
• Desire to be near family

• Healthcare systems that prioritize citizens
• Better healthcare systems in general
• New job opportunities
The second half of 2021 could see a more even pace of recovery as vaccines become more
widely available and travel restrictions are relaxed.
The COVID-19 pandemic brings health

and wellness into the global spotlight
Apart from comprehensive coverage, we see an increasing

number of corporate clients exploring health and wellness
programs that provide both physical and mental support for
their employees, facilitated by digital service delivery, as the
pandemic has transformed the ‘normal’ working environment.
Andrew Merrilees
General Manager at Bupa Hong Kong Insurance
The start of the global health crisis in 2020 led people to change the way they go about their
daily lives, triggering physical and mental health challenges. In order to protect their health,
people had to stay indoors, prompting insurers to address the overall wellness of their policy-
holders. People have been less physically active due to lockdowns and quarantines, resulting
in increased health risks. Social distancing, isolation, and loneliness are causing significant
mental health issues. On top of that, customers are more concerned about their health and
wellness than ever before.
In response, health and wellness initiatives beyond traditional medical cover are on the rise,
with digital health and wellness products and services taking the lead. These initiatives focus
on improving policyholders’ mental and physical health, as well as inspiring positive lifestyle
changes. For example, AXA’s BetterMe platform offers mental and physical health services,
as well as chronic disease management, for its members in Hong Kong. Regulators are also
encouraging insurers to provide value-added benefits in existing plans through wellness re-
wards.
Insurers that establish an authoritative position across the health landscape will have a com-
petitive advantage. The increase in digital use among individuals of all demographics and
ages gives insurers the opportunity to reach more of their members via interactive wellness
initiatives. The rise in mental and physical health problems linked to the pandemic can also
result in higher costs for insurers, which makes supporting the overall wellness of members a
sensible strategy.
Telehealth
At Cigna, we’ve seen a 600% increase in the use of telehealth

services in the past year, driven by the impact of COVID-19 and
lockdowns. As doctors and patients become more accustomed
to the use of virtual health as part of their healthcare journey,
we anticipate that there will be further increases in use and
demand for a wider range of virtual health solutions to be on
offer.
Julian Mengual
The pandemic has helped speed up the adoption of telehealth with half of insurers around
the world currently offering telehealth with all their plans, according to Willis Towers
Watson’s 2021 Global Medical Trends Survey. Telehealth, which includes phone and video
consultations with a licensed professional, gives customers access to a wide range of
healthcare services without needing to travel. Wearables and fitness tracking devices that
tie into the telehealth spectrum can provide extensive data, leading to more customized and
customer-focused services.
Global healthcare and insurance costs

are expected to increase in 2021
Globally projected healthcare benefits costs are expected to rebound to 8.1% in 2021, up from
7.2% in 2019 and 5.9% in 2020.
Figure 2 - With the exception of the US, whose healthcare benefit costs are expected to stay at
a stable 7.3%, the average estimated growth across different regions in 2021 is as follows:
0% 10% 15%
5.8%
8.5%
10%
13.6%
Europe Asia-Pacific Middle East

Latin America
Source: Willis Tower Watson
What is more, 67% of Willis Towers Watson’s research respondents predict healthcare costs
will keep increasing for the next three years. Around 77% of Europe and 90% of Africa and
Middle East insurers predict higher medical trends in the same time frame. 40% of insurers
in the Asia-Pacific predict a higher medical trend while 49% expect medical costs will not
change.
Even though most countries experienced a decline in trend in 2020, significant volatility is
anticipated in 2021’s results. However, the results depend on the impact of the COVID-19 pan-
demic and vaccines, including how widely available it is and who funds it. There is also un-
certainty about testing and treatment for COVID-19 and whether governments, insurers, and
employers will continue to split the costs.
Health insurance premium costs are expected to surpass last year’s increase in the approach-
ing 2021-22 cycle, according to market research and employer surveys. Thailand’s Insurance
Commission expects health insurance premiums to grow by 1.59% in 2021, or THB ฿101 bil-
lion, in comparison to THB ฿99 billion in 2020. Similarly, private health premiums in Australia
are expected to increase at 2.74% on average in 2021, making it the lowest increase since
2001 yet still above the inflation rate. Uncertainty over the ongoing global health crisis has led
to demand for health insurance policies as healthcare expenses are anticipated to increase
every year.
Consumer needs have evolved

Technology advancement and product innovation are expected
to appeal to younger segments, especially millennials, many of
whom are in the market for medical insurance for the first time.
Andrew Merrilees
Virtual health services were already of interest to consumers before the global pandemic
accelerated efforts. In some cases, younger generations prefer virtual care over in-person
when they are given the choice. Many medical consumers would opt for virtual basic care
services, including specialty care as well. In-home care is another option that consumers are
after, with the majority of consumers willing to receive in-home care for anything from regular
checkups to chronic disease management.
Figure 3 - Consumers’ willingness to use DIY care or have a clinician visit their home
Source: PwC
Consumer concerns regarding health were intensified amidst the COVID-19 pandemic and
are likely to remain once the crisis is over. In fact, health and wellbeing are expected to
“dominate people’s lives”. 55% of consumers surveyed for the Accenture 2020 Digital Health
Consumer Survey said that they would be more proactive in managing their health with the
help of trusted medical professionals, giving insurers plenty of opportunities to become part of
the new health ecosystem.
As trust becomes non-negotiable for consumers in 2021, businesses will have to go above
and beyond to build consumer trust and establish themselves as trusted partners in the long
term. Aside from expecting their insurers to provide them with good service and great value,
consumers will also expect them to protect their personal data. In addition, they will expect
that they ethically conduct themselves in all aspects of business, and insurers that appear to
break that trust could risk significant damage to their reputation.
Figure 4 - Trust in hospitals and doctors to keep digital healthcare information secure is high
but drops significantly for tech companies and government
Q: Overall, how much do you trust each of the following people or organizations to keep your digital
healthcare information (including electronic medical records and other information) secure?
“Very much” and “Some” responses.
Source: Accenture
Younger demographics are increasingly

interested in health insurance
As more surveys show that today’s young consumers are more health-conscious than their
older counterparts, it is not surprising that the pandemic has not only catalyzed insurance
digitalization, but also awakened the interest of younger generations in life, health, and other
insurance products.
According to a report by the MIB Group, there has been an approximately 8% increase in
life insurance applications by consumers under the age of 45 in 2020. This is partly because
young consumers are more willing to try new insurance products and are more comfortable
with technology.
With the demographic shift, insurers are also striving to address the different customer
demands by offering an array of innovative insurance products, such as usage-based motor
insurance, job loss insurance, and business closure insurance.
People are expecting more from their

healthcare experience
Although environmental services (including sanitization of high touch-point areas, and espe-
cially patient rooms) in a hospital setting have always mattered, they rarely made or broke a
person’s overall healthcare experience. Crucially, they also rarely impacted a person’s likeli-
hood to return to the facility or recommend it to others. However, the global healthcare crisis
has changed things.
For more than a year now, people have been religiously

practicing COVID-19 safety precautions in an attempt to curb the spread of the novel
coronavirus. So much so that they are now much more aware of the possibility of infections,
and will expect hygiene standards and social distancing measures to be taken very seriously
by hospitals and other healthcare providers.
Moreover, the pandemic has also shifted priorities in terms of people’s health experiences,
including making the need for high-quality, empathetic care more important. This is the
recognition and validation of a patient’s fear, anxiety, and pain in order to facilitate a more
wholesome treatment. That being said, resource constraints in some countries may make this
harder to achieve.
Investing in the digital future

COVID-19 has spurred the adoption of digital technology in the insurance sector, leading to
a growth in the number of insurtechs, as our Cost of International Health Insurance Report
2020-2021 found. In the past year, digital adoption in the global insurance sector grew 20%
- across the entire insurance policy lifecycle. Likewise, global investment in the insurtech
space also reached an annual high of USD $7.1 billion for 2020.
While our industry is facing extreme issues relating to

COVID-19, we also have an unprecedented level of access to
technology and technologists who can help it prevail during
these times of instability.
Andrew Merrilees
From marketing to claims submission to digital policy servicing, digitalization is changing the
face of insurance. According to a survey by consumer credit reporting firm TransUnion, con-
sumer preferences for interacting and engaging with insurers are also tilted towards digital/
online platforms.
Figure 5 - How consumers prefer to interact with insurers
0% 10% 20% 30% 40%
32%
32%
18%
18%
E-mail Telephone calls Mobile app or website portal Other
Source: TransUnion
Phygital becomes the standard

Phygital is a portmanteau of physical and digital. Even though more insurers are adopting
digital services and distribution channels as their primary point of customer engagement,
physical experts are still irreplaceable as they can offer advice on complex, real-life decisions,
which means that both physical presence and digital channels will play a part in the future
insurance landscape.
The pandemic has accelerated consumers’ somewhat irreversible shift to digital services.
TransUnion’s survey shows that 47% of respondents filed an auto and/or property claim last
year, of which 39% used a mobile app, website portal, or email.
In a bid to outperform their competitors, insurers are working with virtual care providers and
online health platforms to roll out telemedicine services as an alternative to in-person health-
care visits. For instance, Ping An Good Doctor in China and MyDoc in Singapore have both
doubled their active users since the onset of the pandemic.
While insurance digitalization becomes an unstoppable trend, insurers must also strike the
right balance between expanding online customer interactions and protection against
cybercrimes.
Adoption of AI and big data
Insurers are increasingly tapping into AI and big data to streamline claims management and
reduce the number of fraudulent claims.
Traditionally, insurance claims are submitted on paper forms and the manual processing can
be slow and more prone to human error. In contrast, AI-based systems leverage deep-learning
technologies and data-driven techniques to speed up or even automate the claims process,
thereby enabling real-time claims processing, as well as prevent or flag fraudulent and inac-
curate claims in a systematic way.
Figure 6 - How AI-based systems can speed up and flag fraudulent claims
Document Flag fraud

pre-processing Identify outliers or
suspicious claims and Fast-track payouts
Ensure provider submits all Check for auto-
filter them for
the information adjudication further investigation To offer greater
convenience to members
Run through rules
and providers
to determine if the
claim can be
auto-adjudicated
Source: Capgemini Financial Services Analysis

REGIONAL CHANGES
AND TRENDS
In addition to the aforementioned global trends, each region has their own nu-
ances and factors that impact the state of health insurance in their respective
locales. In this section, you will find in-depth summaries of key trends as they
apply to each of the following regions:
• Asia-Pacific
• The Middle East and Africa
• The Americas
• Europe
Asia-Pacific
In 2021, the Asia-Pacific region will continue to grapple
with an aging population and increased demand for
healthcare. Coupled with the impacts of the COVID-19
pandemic, this will accelerate telehealth adoption
and other digital innovations. Similar to other regions,
Asia-Pacific has also seen a marked increase in mental
health claims and delayed treatments due to the pan-
demic, and concern remains over higher-than-anticipat-
ed claims costs for insurers moving forward.
COVID-19’s economic impact in the region will also see

the private healthcare sector face lower revenues due to
local and international travel restrictions, and the public
healthcare sector shift focus to value-driven outcomes
and divert funds from healthcare to economic stimuli.
The overall economic uncertainty has also caused a rise
in demand for insurance products in countries like
China, Singapore, and Thailand, to name a few.
Digital transformation is key for insurers amid the

COVID-19 pandemic
The COVID-19 pandemic has dramatically affected the way insurers around the world operate,
resulting in the adoption of innovative online tools - especially when it comes to purchasing
insurance, servicing processes, and underwriting. The global health crisis quickly brought any
in-person services and product sales to a stop and forced insurers to switch to virtual alterna-
tives at a rapid rate.
As people practise social distancing, it is obvious that there is

a great impact and change in their consumer buying behaviour.
We have seen a substantial increase in online purchases and
digital services.
Andrew Merrilees
One of the most widely-used platforms during the pandemic is video conferencing. Compa-
nies all over the world are now comfortable with using telecommunication to connect with
clients and employees, hold meetings, attend seminars, and more. In Asia, some insurers have
been using smartphone apps to manage claims, sell policies, provide telehealth services, and
share health messages. Similarly, insurers are conducting online training classes, offering
digital tools, and enhancing their online customer experience.
Figure 7 - Digital acceleration
Note: Figures may not add up to 100% as they were rounded up/down.
According to Moody’s Vice President, Laura Bazer, technologically advanced insurers are like-
ly to come out of the pandemic as winners concerning revenue, sales, and profit growth in the
long term. Those with fixed business models and products, on the other hand, will not keep up
with their tech-savvy competitors. While rating changes are not likely to change based solely
on technology in the short term, they are likely to be reflected in credit profiles down the line.
Telehealth is a growing trend but also a challenge in

Asia-Pacific
Despite the meteoric rise of telehealth treatment and benefits globally, the rate of telemedi-
cine adoption in Asia-Pacific has been relatively slow. While 50% of insurers offer telehealth
benefits across all plans globally, research by Willis Towers Watson found that almost 30% of
insurers in Asia-Pacific do not offer such benefits at all and have no plans on doing so.
One main reason why telehealth adoption has been a challenge in Asia-Pacific is that some
countries in the region have legislative restrictions in place in key areas, such as prescription
drug delivery, GP services, and mental health consultations. The most commonly restricted
service is the virtual prescription of drugs; key Asia-Pacific markets like Indonesia, India, Ja-
pan, and Taiwan all have pharmacy restrictions of some form in place.
Considering that telehealth benefits are increasingly being seen as an effective cost-contain-
ment tool, employers in Asia-Pacific are advised to stay up to date on the latest legislative and
regulatory changes concerning telehealth treatment, delivery, and benefits.
Lower claim volumes in 2020 could lead to surpluses for

insurers
The catastrophic impact of the COVID-19 pandemic saw a significant downturn of claims as
people adhered to lockdown measures and restrictions, as well as delayed visits to hospital
facilities and health clinics for fear of becoming infected with the virus. For several months
during 2020, the world seemingly shut down with over 100 countries going into either local
and/or national lockdown. This resulted in fewer claims than usual for non-communicable
health issues and, in turn, has led to surpluses where an insurer’s assets exceed its liabilities.
According to Aon’s 2021 Asia Market Review, lower claim volumes in 2020 could lead to
surpluses for medical insurers and may present a window of opportunity for plan sponsors to
secure some of this surplus.
Investing insurance surpluses
Although surpluses offer health insurers a comfortable financial cushion that protects poli-
cyholders in case of unexpectedly high claims, they can also be used for new initiatives that
policyholders will certainly welcome. These include:
Developing new products and Entering new markets, e.g.

services, e.g. COVID-19 insurance expanding to new regions of the
plans, mental health plans, and world or focusing on a particular
wellness programs. segment like expats living abroad.
Investing in new technology, Compliance with new regulatory

e.g. telemedicine apps, care requirements, e.g. entering new
management, and user platforms. markets in new regions across the
globe.
Concerns for health insurers
Although the COVID-19 pandemic has increased surpluses for insurers, it has also brought
with it some undesired outcomes. One of which is the possibility of higher-than-anticipat-
ed claim costs, whether through actual healthcare utilization needs or through regulatory
requirements such as waiving cost-sharing. Additionally, delays in health screenings and
diagnostics for patients with chronic illnesses like cancer and other serious conditions can
increase the risk of claims when screening services resume. Healthcare systems around the
world in 2021 will certainly become more burdened by treating non-communicable conditions,
as will health insurers in dealing with increased claims moving forward.
There has been a marked increase in mental health conditions
Hong Kong is still facing a relatively high unemployment rate

amid the COVID-19 pandemic, which has impacted the
corporate market through employee contraction, and driving
a change in employee membership of some industries.
Andrew Merrilees
While the full impact of the COVID-19 pandemic has yet to be seen, one thing that is clear
is that the global crisis has had a significant psychological effect. Quarantines, lockdowns,
changes to working arrangements, social distancing restrictions, and uncertainty about what
the future holds are some of the many reasons why people will likely be impacted by the
mental effects of COVID-19. Even though mental health claims have been increasing pre-
COVID-19, it is predicted that the psychological effects of the pandemic could result in a large
number of claims. The people who are most affected can generally be categorized into the
following groups:
• People who have lost their jobs and face economic hardships amidst the recession
• Those experiencing isolation and loneliness from social distancing, lockdowns, and
quarantines
• Remote workers
• COVID-19 survivors
• Those dealing with grief
• Frontline health workers, and workers in general
A WHO survey published in October 2020 noted that the pandemic had halted or disrupted
critical mental health services in 93% of the 130 countries surveyed. The US Census Bureau in
December 2020 found that over 42% of individuals surveyed reported experiencing anxiety or
depression symptoms - an 11% increase from the previous year. Similarly, the UK’s Office for
National Statistics revealed the number of adults reporting symptoms of depression increased
by 9% in less than a year.
Figure 8 - COVID’s Mental Stress
Source: Office for National Statistics (UK data); Centers for Disease Control and Prevention (US data)
Labeled as a global mental health catastrophe, the consequences of COVID-19 on men-

tal health are emerging and global. Stress, fear, isolation, unemployment, and loneliness are
some of the most immediate impacts while the consequences of digital interactions and social
media are emerging issues. The upwards trend in overall mental health conditions is likely to
result in an increase in mental health-related insurance claims for mental health issues
globally.
Despite the growing awareness of mental health on work, the pandemic (and the mental
health issues that come with it) highlights how important it is for employers to acknowledge
the connection between mental health and productivity. During the pandemic, companies
have been implementing or improving their EAP offerings to address the mental impact of
COVID-19.
CHINA
Clients were quick to renew coverage in the early part of 2020,

but as China stabilized throughout the year, we have noticed
clients are more focused on benchmarking their options to
leverage competitive pricing as much as possible – more so
than in previous years and continuing into 2021.
Jason Armer
Country Manager at Pacific Prime China
The average cost per policy has decreased
Most insurers have maintained their rates on individual products, which means there have
been no significant increase in premiums worth noting as of late. Many clients are focused on
reduced areas of coverage instead, such as by seeking coverage solely for Mainland China in-
stead of Greater China. With that said, the average cost per policy has decreased due to lower
benefits in general, including reduced area of coverage, no HCPs, and inpatient only.
Groups with low claim ratios are receiving favorable terms
Groups with low claim ratios are receiving favorable terms, while groups with higher claim
ratios are bearing large increases, thereby creating some instability for clients. What’s more,
some insurers are not considering previous underwriting profit or loss when reviewing renew-
al pricing and are looking at each year separately instead.
Larger experience-rated groups have typically seen favorable pricing with what are known as
“rate holds” or, in some cases, even decreases being applied. This is a result of the decrease in
claims due to COVID-19-related lockdowns, medical treatment delays and cancelations, and
more. Smaller groups have also benefited from this trend, which is evident through low sin-
gle-digit increases overall.
However, clients of all sizes who are experiencing higher claims are being impacted by large
increases, so the insurers are generally not subsidizing poor-performing groups as they did in
the past.
EAPs that address mental health are increasingly popular
When it comes to EAPs, the focus has been on mental health and an overall stronger ap-
proach to support work-life balance. This comes as no surprise as the COVID-19 pandemic
has had a significant impact on the mental health of many. On top of that, working from home
has blurred the lines between work and personal life, making balance that much more diffi-
cult to achieve. Popular EAP services include practical advice, life coaching, structured online
counseling, mindfulness, and stress reduction.
Consumer preferences are evolving amid the COVID-19 pandemic
Additionally, the COVID-19 pandemic has influenced the younger generation in China to
purchase health insurance products. Another key trend in the insurance sector is the growth
of online insurance. In 2020, online health insurance premiums had increased significantly by
17.8%. The combination of China entering its internet era and the pandemic has accelerated
the transition from offline to online at a rapid pace.
Consumers in China are increasingly turning to the internet to purchase health protection
and insurance products, thereby increasing the opportunity for insurance providers as well.
According to research from the Swiss Re Institute, over 60% of consumers prefer to shop for
affordable and simple insurance online, including health products. China’s online health insur-
ance premiums are predicted to grow by 43% annually by 2025.
As China comes out of the COVID-19 pandemic, the insurance industry will offer new op-
portunities that can help the nation’s response to epidemics. To be a part of this, insurers will
have to speed up digital transformation, address insurance risk protection, promote insurance
knowledge, and raise insurance awareness.
An update from Pacific Prime China’s office
Our health management services have seen large expansion as we continue to support
clients’ flexible benefit programs, offer better advice on where to get medical treatment,
and leverage our scale to obtain favorable wellness packages (e.g. checkups, dental,
maternity, etc.) to individuals and corporates.
Pacific Prime China will also launch a new employee assistance program with a focus
on making these plans more accessible to smaller companies. Typically, these
programs are focused on corporates with a large workforce, with offerings such as life
coaching, mindfulness techniques, and more.
HONG KONG
We have seen a spike in mental health claims due to
COVID-19-related restrictions and border closures. International
firms have also seen a higher number of resignations in Hong
Kong, presumably because expats are relocating back home to
be with family during these strange times.
Pierre de Mirman
Deputy CEO at Pacific Prime
Mental health claims and elective surgeries impact insurers’ loss ratios
With its frenetic work culture, mental health conditions in the city-state have already been
prevalent pre-COVID-19 pandemic. The COVID-19 pandemic has further exacerbated the
state of mental health in Hong Kong, as border closures, social distancing, work from home
arrangements, gathering restrictions, salary cuts, layoffs, and quarantine rules take their toll
on residents. In the past year, there has been a marked spike in mental health-related claims
among corporate and individual policyholders, which will likely have a knock-on effect on
insurers’ loss ratios.
From our individual clients, we see requests for further support around
mental health, as well as expectations of seamless digital service from online
purchases to policy administration and to healthcare delivery. There is also
higher customer demand for detailed product information and comparisons
for them to make informed choices about affordability in the context of
economic downturn.
Luke Hickey
General Manager at Pacific Prime Hong Kong
Claims for elective surgeries are also on the rise and have resulted in higher loss ratios. One
likely reason why elective surgery claims have increased is that employees have had more
time to think about their healthcare concerns while working from home and, as such, some
have opted to undergo elective procedures. Such treatments can be incredibly costly, espe-
cially when taking into account Hong Kong’s ranking as the second most expensive location
for healthcare in the world. High loss ratios and slow business have resulted in a number of
corporate clients switching to lower-cost insurers, with international schools being one of the
most affected by the aforementioned factors.
Hong Kong’s expat exodus continues
Hong Kong’s ongoing expat exodus - fueled by political instability and a contracting economy
- continues, with over 40% of foreign executives in the city-state considering leaving. Of those
who aim to leave, “cabin fever” and the desire to be with family as a result of COVID-19 travel
restrictions, redundancies, salary cuts, and strict quarantine measures are also key contribut-
ing factors. While the expatriate market for IPMI has been shrinking in Hong Kong, it is antic-
ipated that the growth in demand for such products from HNW individuals will help cushion
the blow caused by the expat exodus.
An update from Pacific Prime Hong Kong’s office
Our Hong Kong team has grown tremendously over the past year. As a result of ac-
quiring CXA’s brokerage unit and its employees, our office is now almost at maximum
capacity. Our star employee, Heidi Jezard, has been promoted to the position of Head
of Business Development and hired two new team members to ramp up the compa-
ny’s business development activities. Another star employee of ours, Janet Leung, has
been promoted to the position of Health & Employee Benefits Team Leader and will be
dedicating her time to training our local staff.
SINGAPORE
There have been no major changes in Singapore’s health

insurance sector as a result of the COVID-19 pandemic, largely
due to the city-state’s relatively efficient management of the
healthcare challenge.
Olivier Zeller
CEO at Pacific Prime Singapore
While the health impacts of the COVID-19 pandemic in Singapore have been relatively under
control, the economic impacts have been very real. The government announced a series of
relief measures, one of which was the DPP scheme that was put into place by the MAS, to-
gether with financial and insurance organizations.
Under the scheme, individuals with life and insurance policies were able to apply to their in-
surer to defer premium payments for up to six months, while maintaining insurance coverage
during this time period. Although the scheme officially ended, many insurers such as
Prudential Singapore have announced that they are still open to extending the deferred
payment option on a case-by-case basis.
Health scares and economic uncertainty: A marked increase in demand for

insurance products
Amidst the health scares of the COVID-19 pandemic and economic uncertainty caused by the
global recession, insurers in Singapore have witnessed a rise in demand for insurance
products that combine both insurance and investment elements, as well as for insurance
products that offer coverage for critical illnesses and have lower premiums or shorter terms.
Insurers opting out of full rider coverage on Integrated Shield Plans
In their latest cost-saving measure, many insurers in Singapore have adjusted the terms for
those on existing Integrated Shield Plans with riders that cover hospital bills in full. The ad-
justment will have policyholders copay part of their bills. The MOH has welcomed the move,
adding that the co-pay will encourage prudent use of healthcare services, and keep health-
care costs sustainable for all.
Impact on employers
If policyholders are no longer afforded 100% coverage under their Integrated Shield Plans,
they may need greater insurance coverage from their employer. As such, the long-term costs
for employers may increase.
An update from Pacific Prime Singapore’s office, and a word about

our flex benefit capabilities
In February 2021, Pacific Prime acquired the Singapore and Hong Kong brokerage arms
of the CXA Group, an insurtech company that has exited this sector to focus on its
cloud-based enterprise SaaS business. This acquisition has expanded our presence in
Asia-Pacific, and complemented our technological capabilities and offerings to
corporate clients - particularly in the area of flex benefits (short for flexible benefits).
Our flex benefit solutions allow employers to offer their employees a wide variety of
benefit options that are beyond the standard scope of insurance policies, enabling
employees to create a customized benefits plan that is tailored to their needs and
wants. We adopt a truly holistic approach to flex benefits broking, which is backed by
cutting-edge technological tools, including:
Flex and Wellness Platform

Customize benefit offerings and administer plans through a member’s portal
Flex Wallet
Purchase extra insurance cover or claim eligible benefits
THAILAND
Due to pandemic-related entry requirements, all foreigners

arriving in Thailand must secure mandatory COVID-19 insurance.
As such, this is driving up demand for these types of insurance
plans in the Kingdom.
Ricky Batten
Head of Sales at Pacific Prime Thailand
As a tourism-reliant country, the economic impact of COVID-19 travel restrictions has been
catastrophic for Thailand. In 2019, the country had nearly 40 million visitors. By contrast, the
country only expects 8 million tourists to arrive in 2021. Largely due to the drop in foreign tour-
ist arrivals, Thailand has seen its economy shrink by 6.1% in 2020 - the first decline in 11 years
from 2009 and its worst full-year since the Asian financial crisis in 1998, where the economy
declined by a close 7.6%.
While the health impacts of the virus were contained in the first and second waves of the out-
breaks, the third and latest wave towards the end of the first quarter in 2021 has begun to see
hospitals run out of beds. This has prompted the setting up of field hospitals and ‘hospitels’
- a portmanteau of hospitals and hotels. Furthermore, delays in the government’s administer-
ing of vaccines have been reported, as the country has so far vaccinated less than 1% of the
population. This has created even more uncertainty regarding the path to recovery.
A silver lining: Rise in demand for private health insurance
People are more driven to seek out the best coverage possible for themselves
and their loved ones, to safeguard their health in the future. There is also
greater awareness of whole health, which has created an appetite for
information and greater engagement in health and wellbeing initiatives.
Julian Mengual
Given pandemic-related entry requirements, all foreign arrivals in Thailand need to obtain
mandatory COVID-19 insurance with a minimum coverage of USD $100,000, which has
shored up demand for these types of plans. Moreover, insurers have also started to develop
COVID-19 related insurance products for domestic clients including COVID-19 riders, lump-
sum payment in case of a diagnosis, etc.
Health insurance premiums have remained stable, compared to previous years. This is be-
cause the loss ratios were very low for insurers. That being said, the economic downturn and
business losses will likely see more individual and corporate clients in Thailand being more
concerned with price competitiveness.
Insurers look to digitalization to stay competitive
In line with the global and Asia-Pacific trend towards insurtechs, insurers in Thailand are also
looking to digitize their sales and offerings. The OIC in Thailand recognizes the importance of
supporting the insurance sector in the digital age through its insurance regulatory sandbox.
This is so that the insurance sector can respond to consumer needs and face competition.
However, more digitalization in the insurance sector means that the consequences of data
breaches or cyber-attacks are higher for insurers. On personal data protection, insurers are
relieved that the enforceability of the PDPA has been postponed until May 2021 due to the
COVID-19 pandemic, affording them more time to comply with the many obligations intro-
duced by the legislation.
What is the PDPA?
The PDPA is the most comprehensive Thai data privacy law to date, as it covers the
rights of users whose data is collected, processed, and held for a specific business pur-
pose. This defining act helps to safeguard personal (general and sensitive) information
and ensure businesses operate accordingly and within strict, specific guidelines set by
the legislation, and is compliant with other regulations internationally, such as the EU’s
GDPR.
An update from Pacific Prime Thailand’s office
To meet the increased demand, Pacific Prime Thailand’s sales team grew rapidly from 3
Sales Advisors in January 2020 to 11 Sales Advisors and 3 Renewal Advisors in 2021.
The corporate team has also expanded, and they now have a claims team.
The Middle East and Africa

The COVID-19 pandemic has resulted in an economic
slowdown in the Middle East and Africa region. Many
insurance companies have been negatively affected by
COVID-19, which has led to reduced capacity in
certain areas. That said, several jurisdictions in the
Middle East and Africa region have introduced
promising laws and rules to advance the development
of their insurance markets. For example, the UAE,
Bahrain, Qatar, and Saudi Arabia have launched
mandatory health insurance schemes as a long-term
solution to meet the healthcare needs of their citizens
and residents.
The Middle East

Mandatory health insurance continues to grow in prevalence
Several countries in the GCC have introduced mandatory health insurance, including the UAE,
Saudi Arabia, and Qatar. Governments in the region have traditionally footed the bill for most
of the healthcare needs of their citizens, but are now looking towards health insurance as a
long-term solution. Interestingly, the employer-funded model, where employers provide insur-
ance for employees (and in many cases, for employees’ dependents) is a popular option.
As a result of mandatory health insurance, the number of people covered by private insurers
will largely increase, and so will the demand for healthcare services. This may result in general
medical inflation across the region, which may similarly prompt insurers to push up premium
rates. Given this, regulation in the sector remains of utmost priority to ensure a sustainable
healthcare funding model.
The UAE is investing heavily in medical tourism, wellness, and preventative care
To make up for lost progress during the peak of the COVID-19 pandemic in 2020, the UAE is
expected to make significant investments in healthcare facilities for specialist areas like organ
transplants, major-complex health surgeries, rehabilitation programs, and cosmetic correc-
tions for the medical tourism sector in 2021. These will help accelerate a rebound in medical
tourism and attract international medical tourists who can travel to the UAE.
Additionally, major investments in wellness and preventative care will primarily focus on ag-
ing-related and mental health issues. These will also support a growing number of residents
that have suffered from the impacts of the COVID-19 pandemic.
Dubai ranked sixth out of 46 destinations in the Global Medical Tourism Index
As a medical tourism destination, Dubai is strongly supported by the wider tourism ecosys-
tem, such as national attractions, hotels and resorts, entertainment options, and the robust
provision of world-class aviation and transport systems. According to the International Health-
care Research Center, Dubai ranked sixth out of 46 destinations in the Global Medical Tour-
ism Index 2020-2021 and could increase further in the rankings over the next few years as
more investments are made to spur growth across the medical tourism sector.
Figure 9 - Overall MTI Ranking
Source: Global Healthcare Resources & International Healthcare Resource Center

Insurers are investing in technology
Given the ongoing COVID-19 pandemic, the insurance sector is expected to face consider-
able demand from consumers looking for an enhanced level of service from the moment they
buy a policy right through to the settlement of a claim. In an effort to deliver, insurance firms
across the GCC are investing in technology to increase their presence and scope of services.
In fact, insurance firms are adopting digital technology in the short term to keep ahead of the
curve, engage consumers, and explore new market opportunities.
Digital technology, which includes digital platforms and mobile applications, as well as big
data, allows insurance firms to pivot from their traditional insurance models and practices to
those that deliver personalized services, speed, and accessibility. In addition to the aforemen-
tioned forms of technology, global players in the region are deploying new-age technologies
such as AI, IoT, and blockchain to ensure better value in marketing and distribution, underwrit-
ing, product development, fraud prevention, and consumer support.
According to Arabian Business, the UAE is also one of several GCC countries leading the way
in introducing 5G technology and services. For insurers, this presents a great opportunity to
out-innovate the competition, while creating value by enhancing consumer experience, im-
proving the accuracy of risk assessment with critical data, and reducing significant operational
costs and unwanted claims-related losses.
DUBAI
Budgets have been reduced and many group clients have

dropped down from high-level insurers to low-level local
insurers at renewal.
David Hayes
Regional CEO at Pacific Prime Dubai
The UAE economy slowed down by 6.1% last year amidst the COVID-19
pandemic, which has seen businesses across the emirates slash their bud-
gets for individuals and group health insurance plans. So much so that the
burden has largely fallen on insurers to lower their premiums and implement
cost-cutting measures like preferred facilities and telemedicine.
Indeed, a number of insurers in the region are committed to offering ‘held

rates’ to retain well-performing group clients of all sizes - a move that in-
evitably reduces sales commission as well. To top it off, many international
insurers are also beginning to offer less costly regional plans to compete
against local insurers.
While group clients prefer to remain with their current insurers, and despite
the aforementioned measures, many group clients have been effectively
forced to switch to low-level local insurers at renewal. As a consequence of
market conditions, some insurers may even be forced to sell their business.
AXA to sell its operation in the Gulf region
AXA has agreed to sell its insurance operations in the Gulf region to GIG for USD $269
million. The deal includes the sale of the French insurer’s 50% stake in AXA Gulf, a stake
of 34% in Saudi Arabia-based AXA Cooperative Insurance, and a stake of 28% in the
UAE-based AXA Green Crescent Insurance.
Value-added services have become a key selling point

Insurers are offering a range of innovative, value-added services such as well-
ness solutions and IT components in their broker offerings, which can help
group clients better manage and lower their costs.
Psychiatry-related benefits shine amidst anxiety-inducing

pandemic
Psychiatry-related benefits and wellness solutions like EAPs are becoming

especially relevant amidst the highly uncertain, anxiety-inducing COVID-19
pandemic.
Africa
Markets are inconsistent in terms of size, mix, growth, and degree of consolidation
The African insurance sector is valued at about USD $68 billion in terms of GWP, making it
the eighth-largest market in the world. That being said, the size, mix, growth, and degree of
consolidation across African markets are inconsistent, with 91% of premiums being concen-
trated in 10 countries. South Africa accounts for the majority of total premiums (70%), and is
the most established market in the region.
The African insurance market remains relatively immature compared to regions like Asia-Pa-
cific and the Middle East, though there is significant scope for growth. While the majority of
growth is likely to be derived from pensions and life insurance, the health insurance market
has shown steady growth over the past few years.
Digital innovation will likely propel the growth of Africa’s health insurance industry
in the years to come
COVID-19 has accelerated the shift to digital and remote channels, and with that comes
greater service expectations. Mobile apps will be a key focus for insurtechs in Africa, with
growth likely to be most significant in regions where mobile utilization rates are currently
below average.
SOUTH AFRICA
At the time of writing, South Africa is on the brink of the third wave of
COVID-19, with all provinces experiencing a dramatic surge in infections.
Healthcare claim costs have hit insurers hard and, as always, regulations
continue to evolve. While no one could have predicted the unprecedented
events that unfolded in 2020, its impacts will continue to be felt in South
Africa long into 2021 - especially in the healthcare and health insurance
sectors.
At least 90% of South Africans are expected to have universal

health cover by 2030
The COVID-19 pandemic has highlighted the importance of rolling out NHI
to ensure that all South Africans have access to quality care. As a result, the
country’s Health Minister and President have formed a performance agree-
ment, which outlines that at least 90% of all South Africans will have univer-
sal health cover by 2030. One of the first steps of the NHI implementation
process will involve establishing an operational NHI fund by 2021/2022.
Public-private partnerships will also be critical to the implementation of uni-

versal health cover. As part of the country’s COVAX global vaccine scheme,
South Africa’s largest pharmaceutical retailer is now in talks with the govern-
ment to discuss distribution strategies.
Insurers must comply with the POPIA

The POPIA, which is the South African equivalent of the EU’s GDPR, com-
menced on July 1 2020 with a compliance deadline of July 1 2021. Much like
the GDPR, the POPIA applies to any entity that processes information.
The POPIA stipulates that consent must be given not only to the information
being collected, but also the purpose for which such information is being col-
lected. The cost of non-compliance can be astronomical; the penalties of not
complying with the POPIA could include a 10-year prison sentence, claims
for damages, or even severe reputation damage. As such, in addition to the
devastating impact of COVID-19, POPIA compliance is on the top of mind for
insurers, brokers, and corporate clients in the region.
The Americas
The Americas is rife with changes in the years 2020
and 2021. In the US, the ACA makes a comeback in the
newly elected Biden-Harris administration. To battle the
COVID-19 pandemic and boost the insurance coverage
rate, the American Rescue Plan (USD $1.9 trillion
stimulus package) was rolled out. Meanwhile, drug
spending continues to rise, especially when it comes
to patented specialty drugs in Canada. Premiums for
private health insurance are expected to increase as
a result. Last but not least, Latin American insurers
are customizing their plans for a fast-growing market
of working and middle-class individuals and families.
However, prevalent health conditions continue to plague
the region.
North America
Global insurtech investment reached an all-time high of USD $2.55 billion in the first quarter
of 2021. Of course, North America was not to be left behind. Customer experience and auto-
mated claim settlement are several examples of what North American insurers are refining.
Having said that, despite healthcare being highly accessible in Canada, Canadian doctors are
behind the curve when it comes to adopting technology to improve medical services. This
may lead to delayed treatments and, thereby, a delayed claims-filing process.
On the other hand, the United States is rushing to provide insurance cover for more Amer-
icans under the American Rescue Act. Meanwhile, they prepare to navigate the unfamiliar
waters of potential changes to health policies under the new Biden administration.
THE US
More Americans are expected to receive coverage through the
American Rescue Plan and the newly returned ACA
How the ACA will evolve under the new administration is yet to
be seen. With that said, there is definitely a significant number
of regulations currently under discussion or being negotiated
through the Congress and administration.
Jonathan Hsieh
Director of Client Services and Legal Affairs at Pacific Prime
Figure 10 - Percentages of Americans without health insurance
Source: US Census Bureau
Under a budding administration, the US rushes to instill COVID-19 relief

packages. To battle a pandemic-related rise in the unemployment rate
and, thereby, a loss of health insurance coverage, the Biden-Harris ad-
ministration has opened a federal Special Enrollment Period for the ACA
marketplaces. This year, the expanded coverage period runs from April 1st
to August 15th, 2021.
Affordability remains a major cause of uninsurance and underinsurance in the US

Along with the American Rescue Plan, nearly 9 million uninsured Americans are eligible
for subsidized coverage and decreased premiums. Consumers that are currently receiving
financial aid do not have to pay more than 8.5% of their household income to enjoy compre-
hensive health coverage. Having said that, affordability remains a barrier to both obtaining
and maintaining coverage. Uninsurance and underinsurance may also leave many Americans
vulnerable to high medical costs.
People are more driven to seek out the best coverage possible for themselves
and their loved ones, to safeguard their health in the future. There is also
greater awareness of whole health, which has created an appetite for
information and greater engagement in health and well-being initiatives.
Jonathan Hsieh
Director of Client Services and Legal Affairs at Pacific Prime
The COVID-19 pandemic and its impact on the world of EB

The global pandemic has taken a great toll on both businesses and their employees. Staff
productivity and retention dropped, while absenteeism increased. All the while, their
collective mental health suffers. Corporations based in the States are increasingly demanding
an improved and revised set of employee benefits amidst the pandemic.
Some popular benefits serve to maintain a healthy workforce in the new normal by promot-
ing company comradery and wellbeing. Others appear here to stay for the long-term, such as
mental health coverage and flexible hybrid work schedules.
Companies are beginning to notice that, rather than separate entities, personal life and work
life are interconnected. As a result, more are assigning a higher priority to care benefits that
better support employees and their families.
An update from Pacific Prime’s US office
With every Pacific Prime office across the world, we are witnessing steady portfolio
increases on a daily basis. Our group administration is currently supported by Cebu,
Philippines. Globally, partner relationships continue to develop significantly, particularly
when it comes to our broker partners in the US. WBN and CIAB are just several of our
key partners here.
Latin America
Latin American health insurance companies will experience the most rapid growth in
the world
While the mix between public and private medical facilities varies between Latin American
countries, private hospitals are outnumbered by public hospitals in most cases for reasons
like smaller sizes and more specialized treatments. A study found that many health systems
in Latin America focus on the needs of people with higher income and neglect the poor. Con-
sequently, health services and drugs tend to only be affordable for the upper class. But since
many health conditions are time-sensitive, patients have become accustomed to using the
efficient private healthcare system.
This has led private health insurance to become an increasingly “growing phenomenon”, ac-
cording to Global Health Intelligence. Latin American insurers are customizing products to
meet the needs of working and middle-class individuals and families. In Latin America, most
wealthy individuals rely on private health insurance to cover their medical care. This gives
them access to a completely different selection of private healthcare providers and facilities,
which are usually higher-quality as well. As a result, private health insurance in Latin America
is a big business that is expected to grow at a rapid rate in the coming years.
A number of increasingly prevalent health conditions are having an upward im-

pact on health insurance costs
According to Aon’s 2021 Global Medical Trends Rate Report, employer-provided health insur-
ance rates will increase by 8.8% in 2021 in Latin America and the Caribbean as employers ad-
dress employees’ health and wellness needs. In Latin America, people generally “suffer from
poorer health” on numerous measures and are also less likely to have access to high-quality
care. This is a vicious cycle as poor healthcare systems cause individuals to have poor health,
which, in turn, contributes to more expensive and less accessible healthcare.
Aon’s report found the most prevalent health conditions in Latin America and the Caribbe-
an that increased medical costs include diabetes, cancer, cardiovascular disease, pulmonary
respiratory disorder, and hypertension. So much so that 50% of Latinos will develop diabetes
over their lifetimes, and have a 66% higher risk of developing type 2 diabetes. Of those who
suffer from diabetes, one-fifth have symptoms of depression. More than 82% of all deaths
were caused by cancers and cardiovascular diseases.
Figure 11 - Diagnosed diabetes rate by race
0% 5% 10% 15% 20%
White Hispanic
Source: CDC
Moreover, unhealthy behaviors contribute to an increasing prevalence of risk factors like poor
nutrition, high blood pressure, high blood glucose, and high cholesterol.
MEXICO
Mexico’s healthcare system was definitely impacted badly for a

country where the local system is not efficient – this only
increased awareness of how important private insurance is for
people in what is essentially a virgin market, where only 11% of
the population have such products.
Steven Lopez
Head of Corporate Sales at Pacific Prime Latin America
The need for private insurance becomes more apparent

Mexico’s healthcare system was severely affected by the COVID-19 pandem-
ic - a system that was already plagued with inefficiencies pre-pandemic. The
inadequacy of the country’s healthcare system increased awareness of how
important private insurance is for people in a relatively embryonic market,
where only 11% of the population have such products. While those who can
afford private health insurance often opt for it, most Mexicans depend solely
on the public healthcare system.
The pandemic’s impact on insurance in Mexico

The average premium increase in Mexico is around 13%. There have not
been any significant changes to Mexico’s premiums in the past year since
annual medical inflation is controlled and monitored by the CNSF, Mexico’s
insurance regulator. COVID-19 became the second most expensive claim in
history for Mexican insurers. The fact that it is not the first means that most
insurers were ready for it, at least in terms of financial backup.
A substantial increase in new business made 2020 one of the best years for
local carriers. On top of that, local insurers now have a better guideline in re-
gards to providing EAPs that were typically not common in Mexico, thereby
bringing the market into alignment with global employee benefits trends.
An update from Pacific Prime’s Mexico office
Our team in Mexico has established a solid office structure and has trained staff who
are knowledgeable about IPMI products and experience to match. As such, they are
able to advise clients from all corners of the world. Our Mexico office has also wit-
nessed a significant increase in headcount.
BRAZIL
Many Brazilians opt for private health insurance despite public
health services
Even though all Brazilian citizens are granted access to the public healthcare
system, private health insurance can also be purchased. 25% of the country’s
population has private health insurance, and most of those plans are provid-
ed by employers. Compared to other countries providing a public health ser-
vice with optional additional private health insurance, the percentage of the
Brazilian population with private medical insurance is considered very high,
which is likely due to the drawbacks of the public healthcare system.
Figure 12 - Insurance coverage (% of population)

0% 50% 100%
Public coverage: 100%

Automatic coverage through decentralized Unified Health System, or SUS, funded with tax revenues and contribu-
tions from federal, state, municipal goverments
Private coverage: 23%

Voluntary duplicative or supplementary insurance (nonprofit or for-profit), either reimbursement-based or with
benefits provided through own facilities or accredited organizations
Source: Commonwealth Fund
The pandemic brings temporary changes to regulatory measures

The existing regulatory framework in Brazil requires carriers to cover a mini-
mum list of procedures. While the list is usually reviewed every two years, the
pandemic has resulted in temporary regulatory measures to ensure private
health insurance policyholders are covered for the disease. The ANS clarified
that amending the list would not be necessary since COVID-19 treatment is
already covered by carriers. It is worth noting that the list’s amendment has
not resulted in a plan pricing review, though this may be seen in time.
Fluctuating expenses as a result of COVID-19

Some carriers’ expenses declined for reasons such as the suspension of elective procedures.
However, there was an increase in expenses due to COVID-19 hospitalization as well - a sig-
nificant cost that is either due to the treatment itself or the volume of patients seeking treat-
ment simultaneously. Currently, the impact on the loss ratio has yet to be seen. It is important
to note that this effect may outlast the pandemic, as many people are rescheduling their
health checkups, surgeries, and more.
Europe
Across the board, the insurance industry in Europe per-
formed well in recent years. Profitability is particularly
high for countries where the state shoulders most of the
pandemic-related costs. Moreover, the COVID-19 pan-
demic has led to delays in patients seeking out medical
treatments in most regions. Having been underfunded
for decades, the UK’s National Health System (NHS)
is now severely backlogged. This, in turn, has led to a
surge of demand for private insurance.
In countries/areas where the state bore most of the COVID-19-related costs, in-
surers made higher profits
Figure 13 - European health insurance markets
France UK Germany Netherlands
Direct pandemic costs Borne by state Borne by state Shared Shared
2020 claims 5% lower 1%-5% lower Unchanged Up to 5% higher
2020-2021 profitability Stable Stable Stable Stable
2021 claims outlook Normalization Normalization Normalization Normalization
2021 premiums outlook Modest increase Flat Strong increase Modest increase
Ultra-low interest rate risk Low Low High Low
Regulatory risk High Low Moderate Low
Health insurers’ market shares Changing Stable Stable Stable
Source: Fitch Ratings
Overall, European health insurers have strong profitability in recent years. Cancelations and
deferrals of non-essential medical treatments during lockdowns translate to lower claims for
health insurers. Profit is especially high for countries such as France and the UK, where the
state bore the brunt of the pandemic-related health costs. In contrast, the benefits of lower
non-pandemic-related claims are offset for insurers who are required to share pandemic-re-
lated costs with the state. Germany and the Netherlands are examples of such countries with
this cost-sharing system.
Rising claims costs post-pandemic could pressure profit margins, but should not threaten
the European health insurance market’s profitability in the long term. In the forecast period of
2020 to 2027, it is expected to reach USD $535.584 billion by 2027. There are several factors
for this growth, including the increasing cost of healthcare services and public policies facili-
tating health insurance (e.g. mandatory health insurance).
Figure 14 - Europe health insurance market is expected to amount for USD $535,584.66 million
by 2027
Source: Data Bridge

Reopening Europe in 2021

Summer 2021 looks incredibly promising for many European countries. Compared to other
regions around the globe, the continent saw the largest decline in new COVID-19 infections
and deaths during the last week of May 2021, according to the WHO and ECDC.
Almost half of the European population (44%) have now received at least one dose of the
COVID-19 vaccine, which has boosted confidence in people and across many EU countries.
So far, many EU/Schengen area countries are now open to tourism - some not needing a
2-week quarantine, some only to the fully vaccinated, some open to travelers from other EU
countries, and some with at least a negative COVID-19 test. In June 2021, the EU
recommended lifting the ban on nonessential travel for visitors from the US that have been
fully vaccinated with 2 doses of an EU-approved vaccine.
How will Europe’s reopening potentially impact the health insurance industry?
As Europe reopens, there’s a strong expectation that travelers will have a better awareness
and understanding of securing some form of health insurance cover. The experience of lock-
downs and restrictions during 2020 will have put health insurance coverage top of mind for
millions across the continent.
For short trips, health coverage on a travel insurance plan could suffice, depending on the
coverage limits and benefits chosen. For long-term travel, especially those wishing to migrate
and move to another EU country, securing comprehensive health insurance may be a more
appropriate choice as it will likely cover higher limits and benefits in private healthcare insti-
tutions. For those traveling from locations that belong to the EU’s safe country list, securing
international health insurance plans will offer the most suitable healthcare coverage for their
time on the continent. This will apply to expats and their family members, as well as the in-
creasing numbers of digital nomads looking to relocate to work remotely in Europe.
Overall, movement and increased activity between European borders will certainly spur the
health insurance industry and its key players into developing suitable insurance products and
services as the situation evolves.
THE UK
The NHS is extremely backlogged now and waiting periods are

at their highest level in decades.
Liz Russell
General Manager at Pacific Prime UK
The UK’s NHS provides comprehensive, tax-payer funded healthcare to citi-

zens and residents in the country, which is the reason why there is relatively
little uptake for private health insurance. However, the NHS’s decades of
underfunding, coupled with the recent impact of the COVID-19 pandemic on
health services, has led to a rise in demand for private health and life insur-
ance policies.
COVID-19’s crippling effects

There has been intense media attention on NHS wait times as a result of
COVID-19. As the Guardian reported, 4.59 million people were waiting to
start treatment at the end of January 2021 - the highest number since
records began in August 2007, reflecting pandemic-related pressures. In the
same month, the number of people waiting more than 52 weeks for
hospital treatment was 304,044 people - the highest number of any month
since January 2008.
Figure 15 - The number of people waiting to start treatment
Source: The Guardian

The effects of the COVID-19 lockdown and work from home policies have also decreased mo-
rale and increased mental health concerns. As a result, standalone wellbeing cover is growing
in popularity - especially the use of remote wellbeing services - as they offer patients immedi-
ate value. This includes health services such as quick and easy access to GPs, mental health
counseling, self-help initiatives, and many more.
Delayed treatment may also impact future claims and premiums
The cost of private health insurance has not seen any significant changes in the past year - a
surprising trend, given that claims were reduced as policyholders were unable/unwilling to
access healthcare in the UK due to the pandemic. However, some insurers have made con-
cessions. For example, Bupa UK offered approximately one month of extra insurance coverage
as a rebate to affected policyholders.
This delay in seeking treatments on behalf of policyholders means that there will likely be an
increase in claims in the coming year, and possibly the late diagnosis of medical conditions -
both of which could see a rise in health insurance premiums. In addition to this, insurers may
also be inclined to hike their premiums across all their products to recoup losses from life and
income protection claims.
Appendix
Appendix A - List of acronyms and abbreviations
ACA Affordable Care Act
AI Artificial Intelligence
ANS National Regulatory Agency for Private Health Insurance and Plans
CAGR Compound Annual Growth Rate
CBIRC China Banking and Insurance Regulatory Commission
CEO Chief Executive Officer
CNSF Comisión Nacional de Seguros y Fianzas
COVID-19 Coronavirus Disease of 2019
DPP Deferred Premium Payment
EAP(s) Employee Assistance Program(s)
EB Employee Benefits
ECDC European Centre for Disease Prevention and Control
EHIC(s) European Health Insurance Card(s)
EU European Union
GCC Gulf Cooperation Council
GDPR General Data Protection Regulation
GHIC(s) Global Health Insurance Card(s)
GIG Gulf Insurance Group
GP(s) General Practitioner(s)
GBP Great British Pound
GWP Gross Written Premium
HNW High-Net-Worth
IoT Internet of Things
IPMI International Private Medical Insurance
IT Information Technology
MAS Monetary Authority of Singapore
MOH Ministry of Health
NHI National Health Insurance
NHS National Health Service
OIC Office of Insurance Commission
PDPA Personal Data Protection Act
POPIA Protection of Personal Information Act
SEP Special Enrollment Period
THB Thai Baht
UAE United Arab Emirates
USD United States Dollar
UK United Kingdom
US United States
WHO World Health Organization
www.pacificprime.com
REF: 2021-08-PP-SOHI
All information contained within this document is accurate at the time of its publishing.
All statements made are for informative purposes only, and are not indicative of any policy specifics.

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The State of

Hong Kong Shanghai Beijing Singapore Bangkok Dubai London

• Overarching factors shaping the global insurance

Andrew Merrilees Julian Mengual Pierre de Mirman

Disclaimer: This report is intended for general informational purposes only,

Most insurers will cover pandemic-related costs going forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Major healthcare trends and challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

The burden of delayed care is on the rise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

The burden of mental health conditions is expected to grow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

The pace of recovery varies across from country to country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Global healthcare and insurance costs are expected to increase in 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Consumer needs have evolved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Younger demographics are increasingly interested in health insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

People are expecting more from their healthcare experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Investing in the digital future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Phygital becomes the standard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

III. Regional changes and trends ............................................................. 27

The Middle East and Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

CHANGES AND TRENDS

Insurance companies and clients

As the pandemic has evolved, so too have the needs of our

Most insurers will cover pandemic -

Figure 1 - Pandemic-related exclusions pre- and post-COVID-19 globally

Global Latin America Asia-Pacific

Post-COVID-19 - Do you expect claims arising from pandemics to be excluded

Global Latin America Asia-Pacific

Source: Willis Tower Watson

Pandemic-related exclusions on behalf of Asia-Pacific insurers:

Many countries have introduced COVID-19 insurance requirements for travelers

Major healthcare trends and challenges

Major healthcare trends

Digital acceleration and advances in technology will enhance telehealth and

Combining the outcomes of AI with blockchain technology will further facilitate

Major healthcare challenges

Communication between individuals, organizations, and governments around

The burden of delayed care is on the

40% of individuals stated they have canceled upcoming

McKinsey & Company

The burden of mental health conditions

What is mental health?

Mental health is largely a stigmatized issue, but there is more awareness in

Outreach to people facing

Telehealth and mental health: A trend accelerated by the COVID-19 pandemic

Virtual consultations for Virtual consultations for

The pace of recovery varies from

Some of the main motivators behind moving back home include:

• Desire to be near family

The COVID-19 pandemic brings health

Apart from comprehensive coverage, we see an increasing

At Cigna, we’ve seen a 600% increase in the use of telehealth

Global healthcare and insurance costs

Europe Asia-Pacific Middle East

Source: Willis Tower Watson

Consumer needs have evolved

Younger demographics are increasingly

People are expecting more from their

For more than a year now, people have been religiously

Investing in the digital future

While our industry is facing extreme issues relating to

Figure 5 - How consumers prefer to interact with insurers

0% 10% 20% 30% 40%

E-mail Telephone calls Mobile app or website portal Other

Phygital becomes the standard