Geopolitical tensions, economic uncertainty and shifting trade patterns are redrawing the global mobility map. And, with employee and employer needs evolving, innovation is key across the international private medical insurance (IPMI) market.
Traditional expat destinations such as Hong Kong and Singapore are no longer dominating international assignments, according to William Cooper, marketing director at William Russell. “We’re seeing much more travel to the Middle East and South East Asia,” he explains. “There’s also been more migration to Southern Europe.”
New assignments
As well as new expat destinations, the nature of global mobility is also changing. Joe Thomas, managing director of April International UK, has seen a noticeable shift away from traditional long-term relocations towards shorter, more flexible or rotational assignments. “Geopolitical tensions have influenced how organisations approach international assignments,” he adds. “We’re seeing a more cautious and structured approach, particularly in higher-risk regions.”
This is supported by global mobility research from Axa Global Healthcare, which found that short-term placements are predicted to increase by 69 per cent in the next five years and are expected to shorten further with the rise of digital nomadism.
Financial pressures
Cost is a key driver for IPMI innovation. Rising costs mean medical inflation is raging. Sarah Dennis, head of international at Everywhen, says: “It’s rare to see any premium increases below 15 per cent. It does depend on claims experience but with the cost of oil and gas increasing, medical costs will rise too.”
Against this backdrop, more flexible and modular products are the norm as insurers look to balance the needs of increasingly diverse and mobile workforces with the budgetary constraints of finance directors. Sebastian Judez, global head of product and proposition at Axa Global Healthcare, says insurers have a range of cost control mechanisms. “An insurer might offer a closed network or options on co-pay or co-insurance. Benefit levels can also be flexed to suit needs.”
Cover is increasingly being designed to better reflect where an employee is going to be based. Rather than offering the choice to include or exclude the US with its budget-busting healthcare bills, insurers are open to splitting zones and creating new regions for cover. This can help to lower premiums.
Similarly, shorter-term cover is an option. “It may be possible to take out cover for less than a year, or to tailor it so they have cover in one country for six months and then in another for three months,” explains Judez.
Cost containment
Alongside budget-conscious product design, insurers are busy working on cost containment measures behind the scenes. “There is a need for control around costs,” says Michelle Bishop, global practice leader, multinational benefits & mobility at Gallagher. “Healthcare in some expat locations such as the Middle East, Singapore and the US is very high cost.”
Effective provider network management with negotiated pricing and direct billing arrangements can help. “Some insurers are doing more regionally,” adds Bishop. “They might work with a local network or set up more blended populations, with both local and expat employees, as this can help to cap exposures.”
But, left unchecked, claims costs can escalate, with insurers at risk of overcharging but also overuse. “We see different benefit utilisation trends around the world,” says Cooper. “In Dubai, members use their limits. They see IPMI as a benefit and they make the most of it. To prevent this, we encourage members to contact us first. This gives them the reassurance that a claim will be covered but it also enables us to signpost them to the most appropriate care.”
And, where a particularly over-the-top claim comes in, Dennis says insurers aren’t afraid to pull the reasonable and customary clause out of the policy wordings bag.
Heightened risks
Geopolitical tensions are also shaping the IPMI market, with employers keen to check exactly what cover they have for members. Thomas explains: “The situation in the Middle East has led to heightened scrutiny from both employers and individuals around how cover operates in higher-risk environments. They’re paying closer attention to policy detail, particularly around exclusions such as war or terrorism, as well as the scope of evacuation and repatriation. There is also demand for reassurance around continuity of care, access to provider networks and the ability to support members across borders if local conditions change.”
The possibility that employees could be caught up in conflict has also made the employer’s duty of care responsibilities a central focus. Alongside more rigorous risk assessments and forward planning, this has seen demand for security information and support.
Insurers are responding to this. For example, William Russell offers a travel safety app, Solace Secure. This provides real-time security information including alerts if a member is near an emerging risk such as civil unrest, conflict or a natural disaster.
Employee support
As well as providing more support to members caught up in potentially dangerous situations, the IPMI market is also focused on looking after employees’ health and wellbeing. “Health insurance is no longer seen purely as protection against major medical events,” says Thomas. “Employees now place greater value on day-to-day healthcare support such as outpatient care, mental health services and preventive care.”
To meet this demand, most IPMI insurers now offer a range of wellbeing apps as well as telemedicine support
such as online GP and mental health counselling. “There’s a real push towards preventative health,” says Dennis. “It makes sense financially. The biggest claims areas are mental health, musculoskeletal and cancer so if an insurer can manage care better, or prevent conditions completely, it will benefit claims costs.”
For example, as part of its cancer cover, William Russell offers genome and genetic testing. While genome testing helps to identify the best treatment, improving the member journey and reducing claims costs, genetic testing is offered to anyone with a family history of cancer to help identify the risk and support early detection.
But even something as simple as an online GP service can help control costs. While these services have driven up costs in the UK market as they refer more people to diagnostic testing, in the IPMI market they enable early intervention from the insurers. This has led to savings of up to 30 per cent on treatment costs, says Dennis.
Employee wellbeing extends into the experience they receive when engaging with their IPMI according to Judez. “The member experience is really important,” he explains. “The digital side, whether that’s policy details and claims submission or wellbeing support, must all be in one app. They also want faster reimbursement and services such as payment cards.”
IPMI sector outlook
As the US-Israel war with Iran continues, an air of uncertainty hangs over the future for global mobility. Rising oil prices are pushing up the cost of an international assignment, which already comes in at
an average of $79,636 (c.£58,900) a year above base salary according to Axa Global Health. Should the ongoing conflict trigger a global recession, more companies may favour Zoom calls over overseas postings.
Already, trends such as shorter assignments and lower cost destinations are helping to curb business expenditure.
But Dennis remains upbeat about the prospects for the market. “There’s always a need to put people on the ground, especially in sectors such as pharmaceutical, technology and energy,” she says. “Global instability means demand for IPMI is up as employers prioritise their duty of care responsibilities. Whatever happens, the long-term outlook is positive.”
