MENA: Private health premiums to grow at CAGR of 9.7% till 2020 - Swiss Re
Source: Middle East Insurance Review | Apr 2015
Reimbursement-type private health insurance (PHI) premiums in MENA are forecast to more than double from US$7.4 billion in 2013 to $15.6 billion by 2020, representing a compounded annual growth rate (CAGR) of 9.7%, according to Swiss Re’s sigma study, “Keeping healthy in the emerging markets: insurance can help”.
MENA’s predicted CAGR for reimbursement-type PHI is the second highest among four emerging markets. The other three emerging markets are Central and Eastern Europe (CAGR of 5.0%), emerging Asia (15.4%) and Latin America (6.2%).
Across all the emerging markets, the CAGR of reimbursement-type PHI premiums is forecast at 9.6%, with private health premiums expected to grow from $36 billion in 2013 to $78.8 billion by 2020, said the study. As income levels in emerging markets rise, people spend more on healthcare services – this is driving demand and expectations for better health services.
Private expenditure is an important source of healthcare finance in MENA, but PMI is a relatively new phenomenon: only Saudi Arabia, the UAE, Israel and Turkey have a sizeable PMI industry, said the report. Out-of-pocket payments account for the bulk of private spending.
In Sub-Saharan Africa excluding South Africa, a very small percentage of the population has PMI, and premiums and the breadth of cover are small. Micro health insurance schemes have been introduced in Burkina Faso, Cameroon, the Ivory Coast, Ghana, Guinea, Mali, Nigeria, Senegal, Tanzania, Togo and Uganda. The schemes offer less-comprehensive cover than PMI and the resulting premiums are low in comparison. Micro health insurance is likely to become a building block in financing of future health expenditure in the region, the report said.