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From rising inflation amidst geopolitical and macroeconomic pressures to the prevalence of AI, our world has been forced to adapt to the current societal environment.
Our friends at Pacific Prime released the State of Health Insurance Report 2023, which delves into these main drivers of change and addresses the opportunities and challenges in the Individual Private Medical Insurance (IPMI) sector.
The State of Health Insurance in the Post-Pandemic Era
From normalizing social distancing and remote work to accelerating the growth of telemedicine and virtual care services, the health insurance industry was shaped to push virtual solutions to cater to individual needs.
Virtual solutions are the product of retaliation against inflation. Due to the growing labor and supply expenses, the average global inflation rate is projected to be at 10%. The industry has to implement cost mitigation strategies to combat rising premiums to increase the affordability of health insurance.
Rise of Artificial Intelligence (AI)
The maturity of AI is the technological breakthrough in the industry, causing a rise in AI-based solutions to optimize what used to be manual-intensive tasks including claims processing and risk management.
AI empowers insurance providers with the ability to streamline labor-intensive processes so that they can focus on business growth, overall customer experience, data encryption, and insurance plan optimization.
Macroeconomic Challenges
Macroeconomic uncertainty and geopolitical volatility such as the Ukraine war and a looming recession continue to pressure the industry. Their report addresses multiple regions and countries worldwide, but we have extracted what is particularly meaningful and valuable to us.
Asia-Pacific
The health insurance market in Asia-Pacific is forecasted to grow at a compound annual growth rate (CAGR) of 4.6%. The market is expected to reach up to USD $564,990.33 million by 2030.
A key factor driving this growth is the region’s rapidly aging population. The demand for health insurance is proportionate to the average age of the population.
Hong Kong
Transitioning to the new normal, Hong Kongers were shopping more online during the pandemic and have been purchasing policies online for the past few years. Consumers are also aware of surging inflation rates which result in diminished spending power, causing them to lower their expenditure on non-essentials.
Millennials and Gen Zs are dissatisfied with their overall well-being, pushing insurers to rethink their benefits design by adopting a customer-centric mindset, which plays a pivotal role in driving the shift from treatment to prevention which helps cut costs in the long run.
The health insurance industry is undergoing a major transformation. What they have mentioned is just a fraction of what the full report covers. To find out more about the latest state of health insurance and trends in other regions and countries, download their full report for FREE today!
To seek expert insights on health insurance matters, be sure to get in touch with their team of insurance specialists or get an obligation-free quote comparison!