Posted on Feb 04, 2015 by Alex Nellist
At the end of 2014 Pacific Prime released a comprehensive report on international health insurance (IHI) premium inflation around the world. By examining several regions, specific countries within those regions, and global insurers selling in each country, the report was able to show that inflation in the industry had come back under control around the world vs. the high inflation rates seen in 2011 and 2012.
What may have been lost in the shuffle of the expansive report for expats in Singapore, is that the city-state was one of the countries covered. This article will put a spotlight on Singapore and examine how it fared in 2014 with regards to international health insurance inflation.
Expats in Singapore are the most likely to be impacted by changes in international health insurance premiums, and those who travel regularly for both work and pleasure need insurance that covers them anywhere in the world. In Singapore, expats do not have access to subsidized public healthcare that local Singaporeans are afforded. For this reason they must appeal to private health insurance providers to ensure that they are protected from burdensome medical expenses.
Inflation in Singapore
Most who have lived in Singapore for any extended period of time know about the high level of health care that can be found in the city. In 2014, Bloomberg rated Singapore as having the Most Efficient Health Care in the world. Also, the Economist Intelligence Unit ranked Singapore #2 in the world for healthcare outcomes. This excellent performance points to a modern and efficient healthcare system that features knowledgeable medical staff combined with cutting edge technologies and procedures. With this, however, can come rising medical costs, which can lead to higher insurance premiums.
In 2011 Singapore, like many other countries around the world, saw a sharp increase in IHI premiums with a double digit inflation rate. (11.8%) Since then, there have been 3 consecutive years in which inflation has fallen.
Singapore vs the world
Inflation rates and trends in Singapore have traditionally been similar to those seen in China and Hong Kong, and 2014 was no exception. All three countries had IHI inflation averages between 7.1 and 7.5%. It should be noted, however, that while Singapore had the highest inflation rate of the three territories in 2013, it had the lowest in 2014.
Versus the other ‘low cost’ countries in Asia, namely Indonesia, Thailand and the Philippines, Singapore has historically had consistently higher inflation rates than any of them. In 2014 though, Singapore’s 7.1% inflation rate was near the average among these countries, with Thailand’s being the highest at 7.5% and Indonesia’s being the lowest at 6.3%.
Outside of Asia, IHI inflation rates have followed similar year-on-year trends as Singapore and the rest of Asia, with a spike in 2011 that has generally fallen over time.
All of the world’s best insurers have offices in Singapore. As a world financial and medical hub, any company that wants to be a global player in the insurance industry must have a presence in Singapore. Allowing us to make direct comparisons between insurers rates in important countries like Singapore is actually what allows Pacific Prime to include Singapore in its IHI assessment. Our larger report featured an array of insurers that can be found in Singapore including Aetna, Allianz, HSBC Life, Bupa International, IHI, InterGlobal, and Williams Russell.
For customers, it was a good year to be an InterGlobal client, as they were the only insurer that saw a decline in premiums. Singapore saw a -6.8% decrease in premium price from the previous year. All other insurers saw increases ranging from 3.8% (Allianz) to 14.2% (William Russell). Thus, it can be seen that the average of 7.1% inflation in reality can vary quite widely depending on an individual’s particular insurer.
Singapore’s IHI inflation future
As mentioned in the analysis of Singapore vis-à-vis the rest of the world, the information points to IHI in local markets being heavily affected by global economics. Despite this, local factors point to continuing inflation for the foreseeable future.
The ‘silver tsunami’ created by Singapore’s aging population will continue to take a toll on both medical facilities and insurers’ bottom lines. In addition, the ever-increasing costs of medical care show no signs of stopping. Expect to see somewhat similar IHI inflation in 2015, however, a dramatic change in the global economy would likely change this forecast.