Singapore
Preview
By Greg Arms
IIA’s venture into the internation-
S
al markets with attractive events
such as this month’s International
Conference in Singapore is certainly
a positive trend that can benefit
many members. Communications and
process technologies have shortened the
distances between places and peoples of
the globe.
Members attending the Singapore
conference will learn that self-insur-
The Esplanade is a world renowned performing arts centre locat-
ance for employee benefits has
ed at Waterfront, Marina Bay, mouth of Singapore River. Its twin
already been an established practice
domes are also nicknamed as the Durian by Singaporeans.
in major international markets. ular was an early pioneer of multina- ways to reduce actual costs by address-
Southeast Asia and Singapore in par- tional benefits pooling in Southeast ing such areas as wellness and preven-
ticular, are prime examples.. Asia as were IGP and Insurope tion, health risk assessments, and new
through their local affiliates. e-services for eligibility verification and
Many Asian countries have embraced consumer support.
the principles of self-insurance. In Taking a few giant strides around the
fact, self-insurance for employee ben- globe to India, I met recently with This would take the local healthcare
efits has been a local market practice clients, TPAs, insurers and the local practices beyond pure cost sharing
for over 25 years under the umbrella Marsh management team, and the and cost shifting to a much better
of multinational benefits pooling, main item on everyone’s agenda was place in preparation for fuller self-
which I believe was first introduced to healthcare. insurance in the future when more
the region in the 1970s. stable plan results can be achieved on
India is now considered to be in a a wider scale.
Companies such as Chase Manhattan “post-subsidized tariff” phase for pri-
Bank (now JP Morgan), Intel, vate health products since regulatory Given the rapid growth of the Indian
Motorola, Kodak and others were changes two years ago eliminated economy and the usual escalation of
early practitioners of multinational health pricing tariffs and cross-sub- new points of view, the next phase for
benefits pooling that contained sidy with other lines of coverage. Even self-insuring private healthcare there
advance cash flow arrangements and though the cost of health care contin- is just around the corner.
included excess loss and specific and ues to rise – I was told the current
aggregate catastrophic reinsurance annual trend is 18 to 22 per cent – Come to think, that same corner may
cover for delivery by these companies and medical loss ratios typically sur- be beckoning self-insurance profes-
to their locally written group insur- pass 100 per cent, the situation sionals from many countries of the
ance plans. appears much improved as market world. The more we can learn about
transitioning advances. those opportunities in events such as
In some instances, effective self- Singapore, the more SIIA members
insurance was accomplished via sec- Buyers and underwriters in India are stand to both contribute and benefit.
ond stage accounts reporting where appropriately focused on actual results
the overall account was on a loss carry of group medical without the subsidy Greg Arms is Global Head of
forward basis with the ultimate loss, if that was used to mask real loss ratios in Employee Benefit Practices of Marsh
any, borne by the client and not the the past. The good news is that most Inc. and a member of SIIA’s
local insurance carrier. AIA in partic- stakeholders are keenly focused on International Committee.
4• The Self-Insurer
©
/ January 2010
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