Saudi health insurance market size at SAR 22 bln: CCHI

Council of Cooperative Health Insurance headquarters

The size of Saudi Arabia's health insurance market currently stands at about SAR 22 billion, according to Othman Al-Qasabi, Executive Director at the Council of Cooperative Health Insurance (CCHI).

Pharmaceuticals account for 20% of insurance firms' expenditures on services, he told CNBC Arabia.

The official added that work is ongoing to reduce these expenditures, through pharmaceuticals draft rules that seeks to set a mechanism for obtaining medicines by beneficiaries.

The royal decree on bearing the cost of treating COVID-19 patients led to nearly SAR 2 billion savings for insurance firms so far, Al-Qasabi stated.

Furthermore, the official indicated that CCHI has a strategy of becoming a leading global player in increasing protection and raising the quality and efficiency of services in the private healthcare and medical insurance segments. He noted that their strategy is based on five objectives, which includes more than 13 programs and 65 projects.

One of CCHI's initiatives is the guarantee fund that ensures the coverage of any insured person in small and medium-sized enterprises (SMEs), provided the coverage limits are above SAR 500,000.

In addition, Al-Qasabi indicated that CCHI will cooperate with the Saudi Central Bank (SAMA) on the risk schemes initiative that will allow more than one insurance firm to participate in one risk scheme, thus contributing to more market compliance with insurance, which currently stands at 84%.

There are 75,000 small-sized companies that are facing the challenge of compliance with CCHI regulations, said Al-Qasabi. He expected that the new initiatives will help boost compliance, which will positively reflect on the sale of certificates and the coverage of insured persons.

The insurance cost per person in the Kingdom amounts to nearly SAR 700, Al-Qasabi said, adding the value increases to SAR 1,000 on including the purchase power index, which is good compared to regional and global level.