Oct
29
Chinese Bank ICBC Gains Access to Life Insurance Sector
Filed Under AIG, Allianz, China, China insurance, Income Protection, Insurance Company, Life Insurance | 7 Comments
Industrial and Commercial Bank of China (ICBC) has agreed to buy a major stake in the French-Chinese joint venture AXA-Minmetals Assurance Company. The move by the Chinese Bank ICBC will make them the majority shareholder and add to its non-banking revenue stream.
The initiative by ICBC to acquire the 60 percent share in AXA-Minmetals Assurance comes as the Chinese bank announced that it gained a 27 percent increase in profits during the third-quarter of 2010 with net income of 42.6 billion yuan (US$ 6.4 billion) up from 33.6 billion yuan (US$ 5.05 billion) in the previous year.
ICBC – the world’s largest bank by market value – will invest 1.2 billion yuan (US$180 million) for a 60 percent stake in the French joint venture company AXA-Minmetals Assurance. The deal will subsequently mean the company being named ICBC-AXA Life Insurance Company. The general management of the business will headed by the AXA-appointed president.
The deal struck by ICBC and AXA-Minmentals will strengthen the company’s presence in an ever developing insurance market. Henri de Castries, Chief Executive of AXA said “AXA has full confidence in the business growth opportunities in the Chinese market and this cooperation with ICBC is ideal to increase our respective interests and presence in the Chinese insurance market.”
The link with AXA-Minmetals will facilitate ICBC’s entry into the Chinese life insurance market and add to its non-banking business, gaining access to the health, retirement, education, children and wealth insurance products.
ICBC chairman Jiang Jianqing said regarding the deal: “ICBC boasts a strong customer base, complete service network and increasingly expanding influence in both domestic and global markets. ICBC’s investment in AXA-Minmetals is an important initiative to promote the comprehensive operation strategy and build core competitiveness. ICBC will fully leverage our leading advantages in banking industry to fully promote this strategic cooperation. We believe this strategic cooperation of ICBC with AXA and Minmetals will bring sound investment returns to the shareholders as well as quality and all-round financial services to customers.”
ICBC’s substantial stake in AXA-Minmetals will provide a sound basis for the newly formed company to penetrate the expanding insurance market in China, which has seen company consolidations in 2010, and will enable it to compete with dominant domestic players such as Ping An and China Life in order to gain market share.
China’s second largest insurer Ping An announced plans to merge with the Shenzhen Development Bank in September 2010. This will increase Ping An Insurance’s presence across the country linking with Shenzhen Development Bank’s outlets, expanding the reach of Ping An Insurance and improving prospects for market growth.
ICBC continues the trend of large corporations investing in the Chinese insurance industry reflecting the value of the market which is estimated to be worth US$100 billion. Businesses have been keen to bolster their presence in the world’s second largest economy which is set to continue to grow. Since the onset of the 2007-2008 financial tsunami and the adverse impact on global markets – followed by the subsequent partial recovery – international insurers, banks and finance institutions have been looking for new avenues to develop income growth; China has emerged at the forefront of business opportunities in this direction.
In the same week, ZURICH Financial Services (Zurich) announced that it will maintain a 20 percent stake in New China Life Insurance (NCI) worth US$420 million – a move justified in order to keep a foothold in China’s fast-growing insurance sector. Also Taiwanese based Fubon Life has agreed to enter into a joint venture with China based Nanjing Zijin Investment to create a life insurance company.
Insurers have been particularly active in 2010 looking for opportunities to increase their presence in the Chinese insurance market. This recognizes the prospects derived from a country with a population exceeding 1.3 billion people, composed of an increasingly more prosperous middle-class sector looking for financial and life protection as their personal wealth increases. Also, the Chinese economy has been confirmed as the second largest in the world in 2010, providing global insurers with a large degree of confidence that ventures into this market is justified.
Since tight restrictions on financial trading where lifted in September 2009, the Chinese financial services market has opened up, leading to an influx of international and domestic investment transactions, with global players spearheading business ventures.
The AIA Group, through its pan-Asian life assurance subsidiary AIG, plans to target middle class citizens in China by opening up offices in second and third tier cities to capitalize on sales. This follows their much published floatation on the Hong Kong Stock Exchange.
In 2010, insurers already established in China have boosted their paid up-capital; this includes Allianz China General Insurance – a subsidiary of multi-national Allianz – and the joint venture between ING and Bank of Beijing. These moves by insurers are in anticipation of the Chinese insurance market offering a scope for premium increase.
Domestic China insurers – China Life Insurance (CLI), Ping An Insurance Group of China (PAIGC) and China Pacific Insurance Corporation (CPIC) – have continued to be robust this year, although the market has been more competitive with new entrants to the Chinese insurance industry. The China Insurance Regulatory Commission (CIRC) has also granted existing insurers in China permission to expand operations in different provinces. This has benefitted the likes of Taiping Life, Liberty Insurance Company Limited (LICL), Manulife-Sinochem, MetLife, Chubb and other established insurers enabling them to improve the disposition of their operations and reach across China.
Since the Chinese Financial Regulator’s lifting of restrictions on banks from investing in the insurance sector in September 2009, there has been a surge in business activities in the insurance market in China. This has been lead by Chinese banks, looking to gain access to this lucrative and expanding sector. Notable transactions include the Bank of Beijing acquiring a 50 percent stake in ING Capital Life and Bank of China agreeing terms for a 51 percent stake in Heng An Standard Life.
The Government of the People’s Republic of China has eased restrictions and regulations within the country’s financial markets, with the aim of liberalizing the market in order to facilitate the country becoming a leading world financial hub. As a result, direct foreign investment is expected to continue to be attracted to the Chinese insurance markets.
Companies Mentioned:
AXA-Minmetals Assurance
AXA-Minmetals Assurance is the first Sino-French insurance company in China and also the first life insurer approved by China Insurance Regulatory Commission. Established in Shanghai in May 1999, the company has boasted stable and sustainable development with its ambition of Becoming the Preferred Company. In September 2010, AXA-Minmetals has achieved a total premium income of RMB 830 million, increased by 54% compared to the same period of last year and its new business volumes have also increased by 75%.
ICBC
By the end of 2008, ICBC had altogether 385,609 employees and 16,386 domestic and overseas branches, providing extensive and high-quality financial products and services to 190 million personal clients and 3.1 million corporate clients.
Zurich
Headquartered in Zurich, Switzerland, Zurich Financial Services Group is an insurance-based financial services provider with a network of subsidiaries and offices in North America and Europe and also in Asia-Pacific, Latin America and other markets. Zurich is one of the world’s largest insurance groups, and one of the few to operate on a truly global basis. With 60,000 employees serving customers in more than 170 countries, our business is concentrated in three business segments: General Insurance, Global Life, and Farmers.
Allianz
Allianz Group is one of the leading global services providers in insurance and asset management. With approximately 153,000 employees worldwide, the Allianz Group serves approximately 75 million customers in about 70 countries. On the insurance side, Allianz is the market leader in the German market and has a strong international presence.
AIG
The American International Group is a leading international insurance organization with operations in more than 130 countries and jurisdictions globally.
Oct
29
The Pros and Cons of Private Medical Insurance in the UK
Filed Under Expat Insurance, Health Insurance, Healthcare, International Healthcare, Medical Insurance, United Kingdom | 7 Comments
The Pros and Cons of Private Medical Insurance in the UK
A recent report has indicated that the majority of the UK citizens do not consider Private Medical Insurance (PMI) as a high priority concern, mainly because they have access to the country’s free National Health Service (NHS). This free service covers any standard treatment as well as for any other serious or continuous medical conditions. Let us review below the positive and negative points of Private Medical Insurance in the UK.
Pros of Private Medical Insurance (PMI)
- Shorter queuing time: In general, there are more medical facilities available under Private Medical Insurance, as such it has much shorter waiting times than on NHS. In addition, the population in the UK is growing larger and people are living longer due to better nutrients from food and advanced medical breakthroughs. This is putting additional demands on the NHS in terms of both time and costs. Dealing with such an increase is a growing burden for the NHS, making efficient services harder to come by.
- Peace of Mind: Private Medical Insurance gives you a peace of mind. In the event that you have doubts on the NHS GP’s advice, you can always seek a second opinion on your medical condition. Private insurance plans allow for greater flexibility for the types of coverage that are best suited to you particular needs.
- Better Choice: PMI offers you the option to visit the doctor and treatment centre of your choice. Depending on your policy, you may have the option to stay in a private room without the inconvenience and discomfort of being in a mixed-gender ward. Moreover, there are unrestricted visiting hours for persons visiting private room patients.
- Continuity of care: It is likely that throughout the length of your treatment, the same consultant will be handling your medical case, allowing for a greater continuity and consistency in service. This gives you more time with a consultant who understands the very specifics of needs. Depending on your insurance plan, you may also have free access to counseling services.
- Dedicated claims team: Your insurer may have a claims team that specialises in dealing with any claims issues that may arise during the policy period.
Cons of Private Medical Insurance (PMI)
- Not all medical conditions are covered: It very much depends on your policy coverage and your previous health conditions. Most basic inpatient only plans, for example, will not offer coverage for GP services, specialist visits, medications or any regular health checkups. Similarly, if you suffer from a chronic health condition or a long-term terminal illness, then usually, PMI will not cover these conditions. If you have a pre-existing condition or suffered a serious accident or illness over the past five years, it is likely that the insurer will refuse coverage for this. This however will subject to each pre-existing condition and will vary from insurer to insurer.
- What you pay is what you get: The insurance premium is proportional to the amount of coverage you require, hence the more cover you want, the higher your premium will be.
- Difficulty in knowing which PMI policy suits you best: There are many companies available to offer Private Medical Insurance in the market, and sometimes it is hard to have the knowledge to decide which PMI policy best meets your requirements. It is therefore worth talking to an independent insurance advisor, who can help you to highlight the differences between the policies and provide their expertise to explain the terms benefits that each company offers. Individual insurance companies can only discuss their own policies but they cannot give you advice on how it compares with others.
National Health Service (NHS) is only available to UK residents living in the UK. If you are a UK citizen residing overseas to another country, such as Shanghai or Dubai, then NHS will no longer be available to you as a treatment option. Should you require insurance coverage in a foreign locality you can purchase medical insurance overseas. There are two options that one as an expat can purchase abroad, namely an international insurance plan or a local insurance plan. Most expats would prefer to select an international health insurance plan to a local plan, for a number of reasons outlined below:
- With a health insurance plan purchased locally, these will only provide coverage in that specific country. An international plan on the other hand works differently than this. In the unfortunate event, that one has an accident or becomes critically ill in a place where medical facilities are of a lower standard to those in their home country, the plan will provide the option to go home or to another country where the quality of the medical facilities is of a higher standard for medical treatment. This emergency evacuation can be an important point for expats to consider as it gives them the peace of mind that they deserve in foreign places.
- A local plan will only give you protection in the country where you purchase your plan, whereas an international medical plan will provide you coverage globally. Should you decide to relocate to another country, with an international plan in place, you do not have to worry about setting it up again, as it will follow you wherever you travel. However, with a local plan, you are required to cancel the existing plan and take out a new plan in the country you are moving to. A foreseeable problem with local plans is that waiting periods usually apply to a new policy and some conditions maybe considered by the insurer as pre-existing and maybe excluded in the new policy.
- With an international medical plan, expats have the option to select the doctor and hospital of their choice to carry out the treatment. Normally, international plans offer a larger local network of hospitals to their clients when compared to the local plan, allowing the expats a wider selection.
- One of the major differences between International medical plans and local plans is that normally with an international plan, the policy is guaranteed to be renewable for life, while local plans will usually put an age limit on renewal of policies. In most cases if the client is over the age of 65, a local policy will not allow for renewal.
- In general, International medical policies have far less exclusions than local policies. An international policy also has a higher level of annual limit cover, typically over US$ 1 million.
- With an international policy, the renewal premiums are typically community rated, i.e. based on global policyholders, not based on general health or how many times an individual had gone to the hospital in previous years. Local plan renewal premiums on the other hand are determined by the claims of previous years, i.e. if the claims of previous years are high, the renewal premium will increase accordingly.
- Most expats prefer international medical plans to local plans because they offer more benefits and flexibility, giving them the peace of mind that they are looking for.
- On the surface, the local plans might seem like the cheaper option, given that they normally have a lower premium. In the end, however, taking into account the “Exclusions” in the policies, they may prove to be more expensive and insufficient to the level of coverage you required.
New medical breakthroughs including new technology and drugs, diagnostic methods and procedures are improving the chances of getting a cure for illnesses. Medical advances however come with increasing medical costs. Whether you are a UK resident entitled to NHS, or an expatriate residing in another country, Private Medical Insurance (PMI) is an important investment for you to make. It always helps individuals to bypass long waiting lists in the public health sector and receive prompt medical assistance, giving you a peace of mind in getting the treatment that you deserve and without having to worry about the ever-increasing medical costs.
Oct
28
Zurich Targets Middle East and China Markets
Filed Under Allianz, Insurance Company, Middle East, UAE Insurance | 7 Comments
Zurich Financial Services (Zurich) sees emerging markets and Islamic insurance – known as ‘takaful’ – as key long-term opportunities. Zurich intends to continue looking for potential acquisitions in globally emerging markets, and envisages good prospects in the Middle Eastern region to grow its market presence.
As Zurich looks for future acquisitions to strengthen its position in the international insurance market, it highlights the Middle East as having capacity to generate significant returns; the ‘takaful’ industry is expected to grow 15 percent annually over the next 5 years, and generate premium income exceeding more than US$7 billion.
Zurich is looking for bolt-on acquisitions to gain access to emerging markets in a region which has increasingly caught the eye of global insurers. In October 2010, Zurich bought privately-owned Lebanese insurer, Compagnie Libanaise D’Assurance , and has set up a management unit dedicated to the African and Middle East region to take full advantage of the emerging insurance sector.
International insurers are poised to take advantage of the developing Middle Eastern market recognising the opportunities offered by large populations in a financially prosperous region. Zurich will be competing with heavy weight insurers AXA and Allianz who are set to lead the charge in an insurance market which has not completely matured. However, local insurers are well positioned in the market having an established presence and are set compete with global insurers.
The United Arab Emirates achieved a 10 percent increase in life and saving premiums in 2009 but, in general, the life and savings insurance segment in the Gulf and Middle Eastern region remains under-developed. This is mainly because governments have not installed incentives for these segments – unlike the property and casualty insurance sectors – which have seen significant growth over the years.
The sharia-compliant insurance sector – also known as ‘takaful’ – is an Islamic insurance concept, which has caught the eye of foreign insurers who see great potential in the region. The sector’s regulatory system is being rapidly transformed, which enables domestic insurers such as Dhabi National Insurance Company, and Saudi’s Tawuniya, to be well placed to build on their current dominant position in the market. This will present international insurers with the challenge of gaining access and producing products which are attractive and competitive to the region’s communities. Nevertheless, ‘takaful’ poses a tremendous opportunity for insurers who can break into the region.
The current reach of Zurich International Life in the Middle East region includes residents in Bahrain, Qatar and the United Arab Emirates offering saving, investment and protection products.
Following the acquisition of Lebanese insurer Compagnie Libanaise D’Assurances, Zurich will soon have access to markets in Lebanon, Kuwait and Oman giving them a strong foothold in these emerging markets, while continuing to look for potential bolt-on acquisitions to strengthening its foothold in the region and take advantage of increasing premium revenue.
Zurich has also announced plans to buy up to US$420 million worth of shares in New China Life Insurance (NCI) in a move which will mean they maintain a 20% stake in the company. It follows NCI’s decision to participate in a share issue in order to expand its capital base. The decision by Zurich to continue its significant stake in NCI follows the company’s premium income expansion by more than 50% year-on-year in 2010.
Zurich initial investment in the Chinese based insurer began in 2000, with the purchase of 280 new shares in NCI fixed at RMB 10 (US$1.50) per share. In June 2010, Zurich’s total investment in NCI was valued at US$131 million.
Zurich’s CEO Martin Senn said: “Our decision to participate in NCI’s share issue reflects our belief that China’s fast-growing insurance sector represents an attractive investment opportunity. The Chinese government has expressed a clear intent to further develop the country’s insurance market and NCI is well-positioned in the life market. In addition to our investment in NCI, we continue to focus on building our own insurance business in this important growth market.”
The initiative by Zurich to continue its significant stake in NCI follows a year when other global insurers have expanded or developed a presence in the world’s second largest economy. With the growth in China’s economy set to continue, NCI’s is well positioned – with its base in Beijing – to maximise its share in the Chinese life insurance market.
Zurich acquisitions and positive developments in recent times enables the company to be well placed to meet the needs of a changing insurance market and to enable it to focus on further growth in an insurance market set to expand.
The current reach of Zurich International Life in the Middle East region includes residents in Bahrain, Qatar and the United Arab Emirates, providing saving, investment and protection products. And with the acquisition of Lebanese insurer Compagnie Libanaise D’Assurances they will soon have access in Lebanon, Kuwait and Oman giving them a strong foothold in an emerging market, while looking for potential bolt-on acquisition to continue strengthening its foothold in the region taking advantage of the increasing premium revenue.
Insurance Companies Mentioned:
Zurich
Headquartered in Zurich, Switzerland, Zurich Financial Services Group is an insurance-based financial services provider with a network of subsidiaries and offices in North America and Europe and also in Asia-Pacific, Latin America and other markets. Zurich is one of the world’s largest insurance groups, and one of the few to operate on a truly global basis. With 60,000 employees serving customers in more than 170 countries, our business is concentrated in three business segments: General Insurance, Global Life, and Farmers.
New China Life Insurance
New China Life Insurance Co.,Ltd (NCI）has headquarters in Beijing and was established in 1996 It is a large national insurance company, with products
including traditional protection products, bonus products as well as the products that have a strong financial management function. With sustained, healthy and harmonious development of the company, the brand value of NCI is a valuable asset.
Oct
28
Microinsurance Will It Satisfy Global Demand
Filed Under Allianz, Aviva, Health Insurance, Income Protection, Insurance Company, Life Insurance, Philippines | 6 Comments
The purpose of microinsurance is to provide basic, low cost insurance cover to individuals on low incomes requiring protection for typical risks including the affects of serious weather conditions, healthcare, life and non-life products. Microinsurance offers security for individuals who need insurance protection but until now have been unable to afford the relatively high cost of cover.
Insurers are seizing the opportunity to cooperate with international agencies in providing microinsurance to populations in less developed countries, with further scope for providing insurance cover to the less affluent citizens in the more wealthy trading nations. The potential for provision of this type of insurance – by exploiting the scope for attracting high numbers of contributors making regular payments into a fund – is considered to be vast.
It is estimated that there are three billion low income individuals globally who would reap benefits and comfort from low cost insurance. The scale of the market clearly represents a tremendous commercial opportunity for local and multi-national insurers, and, at the same time, it will enable the companies to make a significant ethical contribution to social needs.
Global poverty and the recession will be the key drivers in the growth of the microinsurance business, which is already estimated to be used by 135 million people worldwide. The demand for affordable indemnities is on the rise with insurers in regions such as Africa and South East Asia taking steps to initiate microinsurance programmes.
The challenge insurers, aid agencies and governments face are promoting the concept of insurance to communities which have no or little previous knowledge of commercial and personal protection. Insurers also need to consider the commercial aspects of providing insurance for low level premiums and the trade-off on the volume of potential customers taking out indemnities.
In addition to the sale of microinsurance to new markets, the impact of the 2007/8 financial collapse, the global recession and the imposition of austerity measures in major western hemisphere countries is expected to open up additional opportunities for the sale of microinsurance; a notional estimate portrays the prospect of 50-90 million low income people being plunged into poverty in developing countries. The question then posed is whether more micro policy providers will be needed.
Recessionary pressures and economic factors will undoubtedly influence the size of the microinsurance market, but a number of other variables will contribute to this including climate change and its impact on flooding and droughts.
The provision of international microinsurance is already taking shape. In Indonesia, Allianz has secured 230,000 new customers with microinsurance policies where premiums range from IDR 10,000 (US$1.23) to IDR 100,000 (US$11.2); in a country, with a population of 240 million people, the potential for an increase in business is tremendous and Allianz Indonesia intends to expand its sales force to 50,000 agents by 2015 in order to capitalise on this opportunity. These efforts are supported by the Indonesian government.
It is estimated that the micro insurance market in Africa could be worth US$25 billion driven by a potential customer base of 700 million people. Figures indicate that around 147 million African lives are currently covered by microinsurance polices, which generates approximately US$ 257 million in premiums for insurers. Countries such as Kenya has seen a small take-up of microinsurance, but it was reported by the Association of Kenya Insurers (AKI) that there is still scope for significant improvement – but it is predicted that it may take up to three years for the insurers to develop products to meet the needs of the low-earning population. Unlike emerging and developing Asian nations, countries in Africa generally show little sign of underlying prosperity and the insurers have been slow in seeking market penetration.
Microinsurance is already popular in the Philippines where there is significant exposure to natural disasters – Munich Reinsurance has been particularly active in providing indemnities for this category of risk in this nation. Also, the healthcare system in the Philippines is currently in the early stages of planning the reform of the public healthcare service, where out-of-pocket payments are currently a main contributor to overall funding. This causes a problem for many of the local inhabitants and the government is in the process of establishing the Philippine Health Insurance Corporation (PHIC) to give poorer Filipinos access to better quality healthcare. This is being run alongside the National Strategy and Regulatory Framework for Microinsurance, which is promoting growth of the insurance sector by providing scope for equal and fair access to affordable Philippine mircoinsurance products, thereby raise the general standard of health of the population this country.
Asian countries are keen to take advantage of the microinsurance sector and the issue was raised specially at the East Asian Insurance Congress held in Bali in October 2010; governments and insurers were in unison in recognising the benefits for residents with low levels of earnings requiring the complete range of insurance cover which could be made available.
The BRIC countries – Brazil, Russia, India and China – are recognised as economic powerhouses; however, there are sizeable elements of the very large populations not reaping the benefits of national prosperity. With a wide range of insurers present in these countries, it should be possible to develop insurance products to satisfy emerging demand. India has been at the forefront of developing the microinsurance sector, with large pockets of low income people spread across the country – about 70 percent of India’s 1.2 billion population live in rural areas – and companies such as Bajaj Allianz and Aviva are able to offer life protection policies starting at as little as US$0.50 per week.
Zurich Insurance has increased its focus on providing microinsurance products in Asia, Africa and Latin America and has established good relations with international aid organizations to ensure appropriate products are designed to cater for the needs of the disadvantaged populations in the regions. Latin America has a population of approximately 569 million people, with around a quarter of those people being on low incomes; it is therefore vitally important for all parties involved with the provision of microinsurance do so to meet the needs of this element of society.
Insurers and governments will play pivotal roles in the further development of the microinsurance sector on a worldwide basis. This will fulfill many benefits, firstly, by providing the less advantaged populations in many countries with valuable insurance cover and thus providing invaluable peace of mind to this element of society and, secondly, by providing a mechanism for expanding and improving the robustness of the insurance industry. Microinsurance is not about corporate benefits, it is a means of achieving social equality particularly in the healthcare sector where many countries are looking to reform the structure of health service provision and micro insurance will be an important step in enabling this to happen.
Insurance Companies Mentioned:
Allianz
Allianz Group is one of the leading global services providers in insurance and asset management. With approximately 153,000 employees worldwide, the Allianz Group serves approximately 75 million customers in about 70 countries. On the insurance side, Allianz is the market leader in the German market and has a strong international presence.
Zurich
Headquartered in Zurich, Switzerland, Zurich Financial Services Group is an insurance-based financial services provider with a network of subsidiaries and offices in North America and Europe and also in Asia-Pacific, Latin America and other markets. Zurich is one of the world’s largest insurance groups, and one of the few to operate on a truly global basis. With 60,000 employees serving customers in more than 170 countries, our business is concentrated in three business segments: General Insurance, Global Life, and Farmers.
Aviva
Europe’s fourth largest insurance company, with more than 300 years of experience in the global insurance industry, Aviva is committed to the safety and satisfaction of its customers. They sell a broad range of insurance products including motor and property insurance, protection and health insurance, business insurance, life insurance and pensions.
Munich Re
Munich Re stands for exceptional solution-based expertise, consistent risk management, financial stability and client proximity. This is how Munich Re creates value for clients, shareholders and staff. It operates in all lines of insurance, with around 47,000 employees throughout the world. Especially when clients require solutions for complex risks, Munich Re is a much sought-after risk carrier. The primary insurance operations are mainly concentrated in the ERGO Insurance Group. ERGO is one of the largest insurance groups in Europe and Germany and 40 million clients in over 30 countries place their trust in the services and security it provides. In international healthcare business, Munich Re pools its insurance and reinsurance operations, as well as related services, under the Munich Health brand.
Oct
27
New York Life Selling Two Asian Life Insurance Operations to ACE Group
Filed Under Insurance Company, Life Insurance | 6 Comments
New York Life Insurance Company has signed an agreement with ACE Group for the sale of two of New York Life’s Asian life insurance operations for US$ 425 million.
The deal will see ACE purchase two of New Your Life’s wholly owned life insurance subsidiaries in Hong Kong and South Korea, where ACE Group already has property and casualty insurance operations. ACE Group will incorporate the newly purchased businesses into their local operations which already have US$ 2.15 billion in assets, more than 2,400 agents and earn US$ 330 million in incremental life insurance revenues.
The deal is still subject to regulatory approval and other customary closing conditions, but is expected to close in the first quarter of 2011. ACE is expecting to fund the purchase from available cash, with no financing contingency.
Dick Mucci, the Chairman and Chief Executive Officer of New York Life International, said that “While these are well-established businesses, New York Life has made the decision, as part of a strategic shift, to concentrate on our operations in the U.S., where we have the leading market share in life insurance, and on our markets in Asia and Latin America where we have strong market positions. Consistent with our commitment to policyholder safety and security, ACE Group is a respected and well established global insurer with a strong balance sheet and robust ambitions for growth in Asia.”
The Chairman and Chief Executive Officer of ACE Limited, Evan G. Greenberg, also commented, saying that “ACE has a good track record for building and managing insurance companies globally and a young but successful record with building de novo life companies in Asia, including China, Vietnam, Thailand and Indonesia. These two life insurance companies are small, solid agency operations that have been managed conservatively by New York Life, a venerable and highly professional company. They provide a good foundation on which to build our life operations in these two territories as part of our overall life insurance strategy in the region.
“This transaction is financially attractive to our shareholders. Within the first full year of ownership, the acquisition will be accretive to both earnings and book value per share and will achieve a return on capital that meets our targets.”
Insurance Companies Mentioned:
ACE Group
The ACE Group is one of the world’s largest providers of commercial property and casualty insurance. With its core operating insurance companies rated A+ for financial strength by Standard & Poor’s and A.M. Best, and with nearly US$78 billion in assets and more than US$19 billion of gross written premiums in 2009, the ACE Group is distinguished by its underwriting expertise, superior claims handling and global franchise, and has a physical presence in 53 countries and commercial and individual customers in more than 170 countries.
New York Life
The New York Life Insurance Company is one of the largest mutual life insurance companies in the United States, and also operates in India, Mexico, Thailand, China and Taiwan. The Fortune 100 Company was started in 1845, and is headquartered in New York, New York. New York Life sells life insurance, retirement income and investment products, as well as long-term care insurance.
Oct
26
Hong Kong Government Continues Healthcare Reform Consultation
Filed Under Healthcare, Hong Kong, Insurance Company | 3 Comments
In the latest development of the Hong Kong Healthcare Reform saga, the Hong Kong government has released a new document, entitled ‘My Health My Choice’ for a second round of public consultation within the city.
The initial proposals for reform of the Hong Kong healthcare system started in late 2008. The proposals identified the need for the reform to better manage emerging healthcare costs stemming from an increase in the size of the ageing population in the city. The latest developments see the Hong Kong government publish documents for the second round of public consultation on the reform proposals under the banner of “The Voluntary Health Protection Scheme”. The public consultation process is planned to be completed over a three month period.
The primary conclusion from the first round of public consultation was the lack of enthusiasm for a mandatory private insurance scheme, with a voluntary health protection scheme being the preferred alternative, coupled with a general strengthening of the healthcare system and facilities in Hong Kong.
The Hong Kong government has said it will increase state funding for healthcare in the country by approximately HK$ 3.90 billion (US$ 500 million) dollars per year raising planned total contributions to HK$ 36.9 billion (US$ 4.7 billion) in 2010-11; this compares with base expenditure of HK$ 30.5 billion (US$ 3.9 billion) in 2007-08.
The government has also stated that there is a further HK$ 5 billion (US$ 650 million) available for a variety of healthcare initiatives under the reform process. As part of the reform initiative, projects include the launching of public-private partnership schemes, the sharing of health records and the expansion of the drug formulary scheme within a public healthcare safety net; adoption of the reform proposals would see implementation in the fiscal year 2013-2014. The government would also invest in local healthcare infrastructure and equipment, and aim to strengthen the safety network, with a total investment commitment exceeding HK$ 50 billion (US$ 6.5 billion) over a 25 year period.
The fundamental focus of the proposed healthcare reform is improved access to health services for all Hong Kong citizens, with increased protection under private insurance being able to release capacity in the public sector. The latest reform proposals reflect an agreement between the government and insurance companies to phase the cut-over from public to private healthcare for those citizens with pre-existing medical conditions over a three year period – 0 percent indemnity year 1, 25 per cent year 2, 50 per cent year 3, with full insurance cover from year 4 onwards.
The reform is based on individual participation in the Hong Kong Health Protection Scheme involving additional voluntary contributions to private insurance schemes, with guaranteed renewable policies and access to medical packages for treatment in quality private medical facilities in Hong Kong.
The Health Protection Scheme in Hong Kong is designed to create improvements in access to private healthcare, to bear-down on doctors fees and to generate more choice for patients. The Health Protection Scheme proposed for implementation will subsidize costs to help, in particular, the most at risk patients – the 65 plus age group, those individuals with pre-existing conditions, and incentivise the younger element of Hong Kong’s society – with caps on the co-payments for treatments necessary.
The new government proposals have been developed following criticism for the lack of clarity in certain areas provided by previous consultation documents. While there are some reservations about the ability of the new proposals to deliver the desired level of change from public to private sector healthcare, there is optimism that the proposals now included under ‘My Health, My Choice’ will meet with a positive response from Hong Kong citizens and the medical and insurance professions.
The spot light has been placed on the provision of long term access to healthcare services for the growing population of Hong Kong. The voluntary, incentivised nature of the proposed scheme for greater use of privately funded healthcare is structured to achieve this objective. The results of the consultation process should be known by early 2011.
Oct
25
Fubon Eyes Potential Chinese Life Insurance Venture
Filed Under China, China insurance, Insurance Company, Life Insurance | 3 Comments
The life insurance arm of Taiwan’s Fubon Financial and the Chinese Nanjing Zijin Investment Co are gearing up for a joint venture in China’s life insurance market.
Reports from China estimate that both parties may invest as much as 400 million yuan (US$59.50 million) in forming a new Chinese life insurance company. The move by Fubon will further strengthen its presence on the mainland, which has emerged as the world’s fastest growing economy in recent years.
The life insurance arm of Fubon and Nanjing Zijin are expected to sign a letter of intent on the joint venture in the Chinese insurance market in the near future.
There has been an increase in business activities between Taiwan and the mainland after a landmark free trade agreement – the Economic Cooperation Framework Agreement (ECFA) – enabled a strengthen in ties. The free trade agreement gave Taiwanese and Chinese businesses greater access to each country’s financial services markets, making it easier to invest. With the free trade agreement between the countries also allows companies such as Fubon to enter the Chinese market with greater ease. This may be tempting for Taiwanese insurers looking to expand into the mainland, as the Taiwanese insurance market has matured with significant development since the 1970’s and 1980’s, but in recent years has been largely static and faces tough times.
The potential deal by Taiwanese Fubon comes at a time when the life market in Taiwan has struggled to generate growth in premiums in comparison to fellow Asian markets. If the deal is finalized it will mean that the Fubon’s life insurance arm can be certain they have the opportunity to expanded in the Chinese insurance market; a market in which global insurers are now keen to gain a presence.
Fubon has been at the center of Taiwanese businesses building closer ties with mainland China, with an office located in China for almost a decade.
Fubon Life has also cemented a presence in Vietnam, in order to gain optimum exposure in this country’s developing economy. The Vietnamese insurance market has experienced significant growth, with Fubon Life being the first Taiwanese life insurer in the country – Fubon Insurance (Vietnam) Co Ltd reporting a profit of VND 6.35 billion (US$31 million) in 2009.
In 2009, Fubon Taiwanese rivals Cathay Insurance – a subsidiary of Cathay Financial Holding – was given approval by the China Insurance Regulatory Commission to establish a non-life business in the Chinese province of Fujian.
Fubon Financial acquired a share in China-based Xiamen City Commercial Bank in 2009, which was the first move by a Taiwanese based financial institution to purchase a stake in a bank on the Chinese mainland. The Xiamen City Commercial Bank will be used as a distribution channel for Fubon insurance products.
Fubon Financial is the second largest financial holding company in Taiwan with total assets of NT$2.7 Trillion (US$83 billion), with subsidiaries including Taipei Fubon Bank, Fubon Insurance, Fubon Life, Fubon Bank (Hong Kong), and Fubon Securities. Fubon Life was established in 1993, with a broad product range in the life insurance sector including life, health and injury insurance. In 2009, the Chinese life market was estimated at being worth CNY1 trillion (US$146 billion) in premiums.
Earlier this year Fubon received approval from the China Insurance Regulatory Commission to set up a non-life insurance company in the Chinese city of Xiamen.
The Chinese non-life company is a joint 50-50 venture between Fubon Insurance and Fubon Life Insurance. The non life unit is expected to be trading by the end of 2010, with initial products covering fire and property insurance. The primary target is Taiwanese enterprises already present in the Fujian province, with gradual expansion of the business. In 2008, the Chinese non-life market was estimated to have increased by 17.23% with motor and property insurance being the main two non-life products.
Insurance Company Mentioned:
Fubon Life
Fubon Life was founded in 1993 and is based in Taipei, Taiwan. Fubon Life provides life insurance and health insurance services. Fubon Life Insurance Co. Ltd. was formerly known as Fubon Life Assurance Co., Ltd. and change its name to Fubon Life Insurance Co. Ltd. in June 2009. Fubon Life operates as a subsidiary of Fubon Financial Holding Co. Ltd.
Oct
25
New CEO Named for Aetna
Filed Under Aetna, Insurance Company, USA Health Insurance | 2 Comments
Aetna Inc., the third-largest health insurer in the US, has announced that its Chairman and current Chief Executive Officer, Ronald A. Williams, will be succeeded by the end of November 2010 by Mark T. Bertolini, current President of Aetna. Mr. Williams intends to retire, and will stay on as executive chairman until April 2011, when this role will also be assumed by Mr. Bertolini.
Mr. Williams, 60, who joined Aetna in 2001 and became its CEO in 2006, brought the company back to profitability twice over the past 10 years, when revenue from premiums failed to match medical costs. The insurer managed to lower medical costs through the introduction of insurance plans with higher deductibles, a move in which Mr. Williams played an instrumental role.
Mr. Bertolini, 54, joined Aetna from Cigna Corp. at the beginning of 2003 and was appointed as President in 2007. Mr. Bertolini was Senior Vice-President for national sales at Cigna from 2000 to 2002, after he served as Executive Vice-President at NYLCare Health Plans Inc., a health insurer bought by Aetna in 1998.
According to analysts, one of the initial challenges for Mr. Bertolini in his new role as CEO will be to articulate how Aetna will conquer the challenges posed by the recently-passed healthcare law, something that in the view of industry observers, their close competitors have already made known their respective plans. It is anticipated that Mr. Bertolini will announce the strategic plans of Aetna for diversification of revenue sources.
After the retirement of Mr. Williams becomes effective in April 2011, he will continue being a consultant for Aetna, advising on matters of public policy and federal regulatory strategy until February 2012.
Insurance Company mentioned:
Aetna is a leading global diversified health care benefits company head-quartered in the U.S., serving approximately 35.8 million people with information and resources to help them make better informed decisions about their health care. Aetna offers a broad range of traditional and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioural health, group life and disability plans, and medical management capabilities and health care management services for Medicaid plans. Our customers include employer groups, individuals, college students, part-time and hourly workers, health plans, governmental units, government-sponsored plans, labour groups and expatriates.
Oct
22
Global Insurers Exit Taiwan Insurance Market
Filed Under AIG, Insurance Company, Life Insurance, MetLife | 2 Comments
MassMutual has announced the intention to dispose of their 39 percent stake in joint venture company MassMutual Mercuries Life, which, if successful, will mean the exit of another global insurer from the Taiwanese insurance industry. MassMutual will follow in the foot-steps of other global insures in exiting a life market which is projected to remain volatile in the foreseeable future.
MassMutual has joined AIG and MetLife in attempting to exit the Taiwanese life insurance market, as business is adversely affected by poor financial returns and inadequate prospects. This strategy being partly due to historical policies negotiated at base interest rates which are no longer sustainable.
Compared to the insurance market in neighboring China – which has seen a significant increase in foreign investment in the insurance sector – the Taiwanese counterpart business is not seen as an attractive financial proposition. AIG, Metlife and MassMutal have all put their Taiwanese life insurance businesses up-for-sale in a move to exit a market which has been stagnant in recent years.
Current investors are deterred by a life market which has been struggling to achieve a reasonable financial return in recent years and which has a forecast of low returns in the future. This is combined with the stringent approach adopted by the insurance sector regulators – the Financial Supervisory Commission (FSC).
A forecast by rating agency Standard & Poor (S&P) in 2010 highlighted the difficult trading environment for the life insurance market in Taiwan and the challenging times ahead. The life-insurance market in Taiwan has remained sluggish and turbulent since the recent economic crisis and is inhibited by historic business secured at rates which are no longer profitable. While regional peers Thailand and Japan have seen profits and business growth return, the Taiwanese industry has been slow to recover from the 2007 – 2009 global economic downturn prompting some of the major life-insurers to re-evaluate their continued presence in the country.
An estimated total net worth of US$ 2.5 billion of Taiwanese based insurance assets are up-for-sale. The factors deterring current international insurers based in Taiwan is the lack of future growth opportunities, market volatility and strict accounting policies. Intervention by the Financial Supervisory Commission (FSC) – the Taiwanese regulators – has resulted in the potential sale of two life insurance business divestments – by Metlife and AIG – being blocked.
The sale of Metlife’s Taiwanese arm for US$116 million was blocked by the Taiwanese regulator. Waterland Financial placed a bid for this business in April 2010, which was subsequently blocked by the FSC in October 2010 on the grounds of disagreements among Waterland Financial shareholders and debt repayments plans.
The decision by the FSC to block the sale of the US-based MetLife business followed an earlier announcement that the America International Group (AIG) planned US$2.2 billion sale of its Taiwanese Nan Shan unit had been rejected by the regulators. Primus Financial Holdings Ltd saw their bid blocked for Nan Shan by the FSC on the grounds that it contravened Taiwan’s investment policies.
Following MetLife and AIG’s recent attempts to exit the Taiwanese insurance market, MassMutual is the latest global insurer to take steps to leave the life insurance sector in Taiwan. The US insurer has placed its 39 percent holding in joint venture MassMutual Mercuries Life for sale for an estimated US$97 million.
The trend for foreign insurers to withdraw from the insurance market in Taiwan in recent times is further reflected in global insurance players – Prudential, Aegon and the ING Group’s have all retreated from this market, which has experienced low growth in recent years. Nevertheless, insurer ACE Ltd has not been deterred by fellow counter-parts as they are in talks with New York Life to buy their Taiwanese branch.
Since the 2007 global financial crises took effect, international insurers have been evaluating business operations and repositioning activities worldwide to take advantage of developing and emerging growth markets and exiting sectors of business failing to deliver acceptable financial returns. These factors, combined with the Taiwanese authorities’ adoption of stricter accounting processes in the regulation of financial services in the country, have lead to actions by a number of the major players to seek withdrawal from the Taiwanese life insurance sector.
While global insurers are intent on exiting the Taiwanese insurance market – which is estimated to be worth US$52 billion and is the fourth largest in Asia – neighboring China and other emerging Asian markets have seen an increase in business activity in recent times benefiting from being able to initiate new business in line with current interest rates and projected growth predictions.
Insurance Companies Mentioned:
MassMutual
MassMutual Financial Group was established in 1895. MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyholders. Products include life , disability income, long term care and retirement insurance.
AIG
The American International Group is a leading international insurance organization with operations in more than 130 countries and jurisdictions globally.
Prudential
Prudential has been in the insurance and financial services business since 1848. Today they operate throughout the UK, US and Asia offering international health insurance and retirement planning services, supported by 27,000 employees worldwide.
Nan Shan Life
Nan Shan Life Insurance Company, Ltd. was established in July 1963. After its restructuring in January 1970, Mr. K.K. Tse, the then Chairman of American International Underwriters, became the first Chairman of the company. In forty years, Nan Shan has become a super insurance company with the most professional management, the best operational performance, and a solid financial foundation. Its agency force has been recognized as the best in Taiwan’s life insurance industry.
MetLife
Possessing over 140 years of insurance expertise, MetLife aims to be an innovator in the field of international Life insurance. Globally, MetLife is able to offer its clients accident and health insurance, life insurance, disability income protection, and retirement and savings products.
Ace
The ACE Group is one of the world’s largest providers of commercial property and casualty insurance. With its core operating insurance companies rated A+ for financial strength by Standard & Poor’s and A.M. Best, and with nearly US$78 billion in assets and more than US$19 billion of gross written premiums in 2009, the ACE Group is distinguished by its underwriting expertise, superior claims handling and global franchise, and has a physical presence in 53 countries and commercial and individual customers in more than 170 countries.
Ageas
Ageas is an international insurance company with a heritage spanning more than 180 years. Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business activities in Europe and Asia, which together make up the largest share of the global insurance market. They are grouped around four segments: Belgium, United Kingdom, Continental Europe and Asia. It is an undisputed leader in the Belgian market for individual life and employee benefits, as well as a leading non-life player, through AG Insurance. Internationally Ageas has a strong presence in the UK, where it is the third largest player in private car insurance. The company also has subsidiaries in France, Germany, Turkey, Ukraine and Hong Kong. Ageas has a track record in developing partnerships with strong financial institutions and key distributors in different markets around the world and successfully operates partnerships in Luxembourg, Italy, Portugal, China, Malaysia, India and Thailand.
ING
ING provides banking, investments, life insurance and retirement services and operates in more than 50 countries. It serves more than 85 million private, corporate and institutional customers in Europe, North and Latin America, Asia and Australia.
MassMutual Mercuries Life Insurance
MassMutual Financial Group entered the Taiwan market as an equal partner with Mercuries & Associates Ltd to from MassMutual Mercuries Life Insurance. In 2002, the company accumulated NT $ 64 billion in assets and made a post-tax profit of as much as NT $ 1.04 billion.
Oct
22
Philippines Set to Challenge in the Medical Tourism Industry
Filed Under Healthcare, International Healthcare, Middle East, Philippines | 4 Comments
In 2004, the government of the Philippines introduced a medical tourism initiative – the Philippine Medical Tourism Program (PMTP) – to promote the country’s private healthcare services to the worldwide market. At that time, the likes of Thailand, Malaysia, India and Singapore had already established themselves as Asian medical tourism destinations. Since then the medical tourism industry in the Philippines has recorded an average of nearly 200,000 international patients coming to the country each year for medical treatments, generating US$ 350 million per annum.
The Philippines has an edge over some rival Asian medical tourism providers, resulting from its established reputation for providing highly qualified medical professionals, with many Filipino doctors and nurses trained and working overseas in countries such as the United States of America and the United Kingdom. In conjunction with its reputation for quality medical professionals, the Philippines has a natural beauty, creating an environment for a vibrant tourism industry and an attractive location for international visitors.
While the Philippines medical tourism sector has sound basic conditions for developing its business, it is facing increasing international competition from regional rivals and from Latin American and Middle Eastern countries. Additionally, with tough underlying economic conditions to be overcome and issues with the standard of infrastructure available, the medical tourism industry in the Philippines faces serious challenges.
An Asian Medical Tourism Analysis (2008-2012) highlighted the improvements in the medical tourism industry in recent years, with Thailand, India and Singapore being the front runners in the provision of medical treatments to international patients. The report identified the emerging prospects for medical tourism in the Philippines, Malaysia and South Korea. In order to capitalize on these opportunities, the Philippines has been strengthening its domestic healthcare infrastructure and wellness sector in order to be competitive and attractive to foreign visitors.
The future for the medical tourism industry in the Philippines is expected to remain robust in the coming years, although it faces stiff competition from the healthcare services provided in established countries in Asia such as Thailand and emerging countries such as South Korea and Dubai. The Asian medical tourism industry envisages continued growth, partly reflecting its escape from many of the negative effects from the recent global financial crises. Even though medical tourism in the Philippines is facing a challenging time, mostly due to competition from rival regional providers, the Philippines is taking positive steps to maintain a slice of the lucrative medical tourism market.
Competition in the medical tourism industry is not confined to Asian countries. Serious competition is now emerging from the United Arab Emirates (UAE), which is also making efforts to establish itself as a medical tourism destination. The UAE has invested heavily in marketing and creating a medical tourism industry to compete with the Asian private healthcare sector, but struggles to match prices available for healthcare and medical treatments in Asian countries.
Companies such as the Philippine Medical Tourism Inc (PMTI) work with the Department of Health (DOH) in the Philippines to ensure the provision of healthcare services in the Philippines for foreign visitors meet government standards. PMTI uses its local expertise and knowledge to offer comprehensive medical packages for international patients in association with hospitals, clinics, hotels and resorts in the country. Medical procedures such as hip replacements carried out in the Philippines can be arranged for a price starting at US$ 11,000 including accommodation and transport, while the same procedure in the USA would cost a patient around US$43,000. Companies such as PMTI have increased the competitive edge of the medical tourism industry in the Philippine by providing a value-added service.
It is predicted that the Medical Tourism Industry will be worth US$100 billion yearly internationally by 2012 and the medical tourism sector in the Philippines is well placed to secure a reasonable slice of this substantial and lucrative market.
Compared to Asian rivals, the Philippines entered the medical tourism industry relatively late, not until 2004. Now, the medical tourism industry in the Philippines is striving to become a US$1 billion per year industry by 2012. This is being driven by the Government of the Philippines and Philippine healthcare providers adopting large scale marketing campaigns, promoting the country’s quality and affordable healthcare services to patients in countries with high cost and a backlog in medical treatments.
The Philippines is able to offer comparative low cost medical treatment and health services to the likes of American and British patients in particular. The healthcare system in the Philippines has taken significant steps to modernize healthcare facilities in order to optimize these opportunities, with the Philippine government taking a leading role in spear-heading the promotion of this sector of their healthcare system. In order to be competitive, the Philippines government and private health sector took action to implement projects and schemes to challenge the regional leaders in the provision of medical tourism services.
The medical tourism industry in the Philippines was able to hit their planned target of 700,000 medical travelers in 2008. This has lead to the HEAL Philippines (Health and Wellness Alliance of the Philippines) organization working with the government and the private sector to drive up medical tourist numbers visiting the country. HEAL Philippines’ primary goal is to develop and promote the Philippines as a global healthcare and retirement destination in a competitive region of the world.
Part of the HEAL Philippines networks’ role is the accreditation of hospitals, clinics, spas and other health facilities used in providing a range of treatments and procedures for medical tourists in the Philippines. Currently there are 44 accredited Philippine hospitals and designated clinics across the Philippines – mostly in the capital Manila.
Medical packages like the ‘Smile Holidays’ for medical tourists seeking dental treatment have been popular, and the Philippines is able to provide certain cosmetic surgery from as little as $2000. However, at the moment, the Philippines’ medical tourism industry is finding it difficult to compete with Thailand and India for complex surgical treatments.
The prime focus currently is aimed at the medical tourists from the Middle East and the Pacific region, with secondary markets being Europe, Japan, Australia and Taiwan. Overcoming language barriers in the Philippine healthcare system is being addressed to fully exploit the medical tourist market.
In conjunction with the Philippines medical tourism industry, the access for public healthcare for Filipino citizens is set to improve by 2013, with the government of the Philippines drawing up plans in 2010 to introduce universal healthcare coverage for the indigent population of the country.
The Asian Hospital and Medical Center in Manila is one of the healthcare providers in the Philippines specifically catering to the medical tourism industry. It provides a special international health service for foreign patients, dedicated to providing comprehensive care for a visitor with a focus on reassurance to a patient when receiving medical treatment during their time in the hospital. The Asian Hospital and Medical Center is affiliated and owned by the Bangkok based Bumrungrad International Hospital, which is one of Asia’s most recognized private health providers.
The St. Luke’s Medical Centre is located on the island of Luzon in Quezon City and is a Joint Commission International (JCI) accredited hospital. The St. Luke’s Medical Centre offers a wide range of medical services covering cardiovascular medicine, ophthalmology, cancer, neurology and neurosurgery, and treatments for liver and digestive diseases. The hospital receives international patients from the United States, Europe, Asia and the Middle East. It has an international patient care center providing extra services for the medical tourist such as travel planning and airport pickup.
The Philippines has set the foundations to become a major player in the medical tourism market reflecting the government’s commitment to work with private health providers in the Philippines to provide a challenge to other suppliers in an industry which is expected to expand significantly; especially with major healthcare reforms being applied by western countries; an industry report has indicated that the Asian medical tourism business will grow by 16 percent between 2010 and 2012.
The medical tourism industry in the Philippines is still in the early stage of development, compared with its Asian counter-parts, and faces strong competition in an industry which has rapidly expanded. The rewards for being successful are enormous, with the medical tourist sector currently estimated to be worth roughly US$55 billion per year and is set to rise to US$ 100 billion in the medium-term future.
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