At the beginning of this month, Oman reported gross insurance premium rises of more than 13 percent during the first half of 2013. According to numbers from the Capital Market Authority, gross written insurance premiums had grown to OMR202.4 million (more than $500 million in U.S. dollars) during the first six months of the year; a drastic increase over figures from that same time period one year earlier. The Capital Market Authority has also reported that this strong premium growth on the insurance market is mainly due to growing numbers of people in Oman seeking medical coverage.
Similarly to nearby Middle Eastern nations such as Saudi Arabia and the United Arab Emirates, Oman has a system of universal health care. Therefore, many residents have no need to purchase a private insurance policy – and yet many locals and expats are doing just that. The 2013 growth in health insurance premiums demonstrates that Oman’s private medical insurance market is getting much, much bigger; in the first half of 2012, gross premiums were OMR18.6 million (about $48 million U.S. dollars), and one year later, gross premiums for that same period of time had just about doubled to OMR36.7 million (nearly $1 billion U.S. dollars).
One reason for this growth is that more and more employers are purchasing private insurance plans to cover employees’ medical needs. At the beginning of this year, an article in the Oman Daily Observer reported that private sector employers are already required to cover workers’ health insurance – either by paying medical fees directly to hospitals, or by purchasing private health insurance. These days, more and more employers are choosing the health insurance route, possibly due to the fact that offering health insurance can make an employment package more attractive, and help the company attract new talent. Also, expatriates do not have access to Oman’s universal health system, so any company hiring employees from abroad will want to offer private insurance. As Oman’s economy grows and even more overseas business flows into the country, it’s likely that the private insurance marketplace will continue to grow.
Chairman of the Oman Insurance Association Nassir al Busaidi agrees that employers are the major force behind this year’s increase in gross insurance premiums. Busaidi has said that offering employees private insurance is becoming a norm in Omani business, therefore companies do not want to lose out on talent by not offering a sufficient health insurance policy. As employers’ needs increase, competition amongst private health insurance policies may strengthen as well, with plans offering more comprehensive coverage (of dental care, for example) in order to stay competitive on the market.
Apart from rises in employer-sponsored policies, the growth of the medical insurance industry in Oman is also due to Omani citizens purchasing private insurance plans – even though every resident has access to public health care facilities, some individuals prefer to pay for a private care policy. One reason for this is that although the standards of care in Oman’s larger city are quite good, public hospitals and clinics in rural areas can’t always offer a good level of service and comfort. Omani citizens who live away from a big city or who travel for work may want to invest in a private insurance policy that can guarantee a certain level of care, or will pay for transportation back to a major hospital.
Expats and Omani citizens may also prefer to avoid the general problems which have for years plagued hospitals in Oman. Internationally, hospitals adhere to a standard citizen to bed ratio of 1,000 to 3, but in Oman, there are approximately 1.8 beds for every 1,0000 residents. The result, of course, is long queues in emergency rooms and sometimes excessive waiting lists for scheduled surgeries or other treatments.
This June, one columnist for the Times of Oman suggested an interesting fix to the problem of crowded health care facilities – force wealthier citizens to purchase private insurance. The columnist, Saleh Al Shaibany, suggests that if higher-income Omanis were obligated to buy their own insurance policies, the Ministry of Health could focus its efforts upon improving services for lower-income citizens who depend upon public care facilities. What’s more, a compulsory private insurance law for wealthier residents would be good news for the nation’s insurance industry, and promote economic growth and competition in the medical insurance marketplace – which would also lead to job opportunities for more Omani citizens.
The health insurance industry in Oman is definitely experiencing an exciting period of growth. Besides gross premium increase figures from the Capital Market Authority, many new health facilities are also in development. In fact, the 2013 Health Facilities Infrastructure Oman conference will take place during the second week of November, and a number of health care projects are due to be highlighted. For example, conference attendees will have the chance to learn about design projections for new Ministry of Health facilities, including a large Medical City expected to cost nearly $2 billion U.S. dollars. Oman’s Apex Medical Group will be demonstrating their own International Medical City, and health care projects from the medical group Shifa Al Jazeera will also be featured at the conference.