universal healthcare in indonesia & singapore · 2020. 7. 3. · about bpjs kesehatan 640...
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Speakers:
Universal Health in
Indonesia and SingaporeCan P2P Healthcare be a solution?
Mr. Albertus Setiadi
RGA
Mr. Jairus Ng Yi Jun
PWC
Mr. Robin Hu
Aviva
Q&A Session
Moderator: Ms. Shong Kay Ying, RGA
2020 SAS Sponsor
Virtual SAS Afternoon Forum
29 May 2020 (Friday)
12.15pm – 1.45pm
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Albertus SetiadiIndonesia National Healthcare Scheme -
Badan Penyelenggara Jaminan Sosial (BPJS)
Jairus NgA Comparison of Universal Healthcare in
Singapore and Indonesia
Robin HuA Brief Introduction on P2P Mutual
Healthcare Funding in China
Presented by: Albertus Setiadi
Indonesia National
Healthcare Scheme Badan Penyelenggara Jaminan Sosial
(BPJS)
1A
ge
nd
aBrief History of Indonesia National Health Care Scheme
2 About BPJS Kesehatan
3Component of BPJS Scheme (i.e. Member, Funding, Benefits & Role of Private Insurance)
4 Challenges facing BPJS Scheme
5 Summary
Brief History - Indonesia National HealthCare Scheme
Dutch government officially acknowledge Indonesia
independence. Then Minister of Health (Mr Siwabessy) issuedearly proposal for universal healthcare scheme
1949Formed a formal organization (BPDPK) to manage operation of
healthcare scheme coverage for government staff andpensioners, including their family.
1968
Reform BPDPK into PT Askes (state owned company). The
new organization extended healthcare scheme to include staff
of all state companies. In 2005, PT Askes further extended the
program to include coverage for poor family under subsidy ofnational government, benefting around 60mn individuals
1992 - 2005
Indonesian government issued bill of Universal Health Care
Scheme (BPJS) and appointed PT Askes as operator whose
name later changed into Badan Penyelengara Jaminan Sosial(BPJS) Kesehatan
2011
1Jan 2014 as official operation of BPJS Kesehatan which runs
BPJS Scheme
2014
Indonesia’s Universal Healthcare Scheme (BPJS) officially started on 1st Jan 2014 & is currently run by state owned operator called BPJS Kesehatan
Realisation of national universal healthcare scheme
Ensuring sustainability of the scheme
Widening coverage to include all
Indonesians
Providing best service to member
About BPJS Kesehatan
• Operator (state owned) of Indonesian National Universal Health Care scheme (i.e. the BPJS scheme)
• Mission is to– Provide the best service to member– Widen coverage to include all Indonesians– Ensure sustainability of the scheme
• Essentially, realizing the ideals of national universal healthcare scheme in Indonesia
IDR 94 Trillion (USD 6.3bn) Total Claims paid
About BPJS Kesehatan
640 Thousandscustomers Per day who consume
healthcare under BPJS scheme
IDR 11.7 Trillion (USD 780mn) P&L deficit
Snapshot for year 2018
Source: 2018 Audited Account from www.bpjs-kesehatan.go.id
IDR 34.7 Trillion (USD 2.3 bn) cumulative (Since 2014)
total deficit of the scheme including
additional grant/subsidy from
government
• There are 5 membership categories with total a of 221 million members as at 31 Aug 2019.• Membership is compulsory.• The largest membership category (about 6 in 10 BPJS members Or 132 mn people) is from
non-paying member.
Component of BPJS – Member
Source: https://bpjs-kesehatan.go.id
132
17
34 33
5
0
20
40
60
80
100
120
140
(Eligible) Non payingmember
Salary worker & coreFamily (Government
Staff)
Salary Worker & coreFamily (Private
Companies)
Non-Salary Worker &core Family (Incl foreign
expatriate)
Not Working
Mill
ion
Membership Category
BPJS Member - Total 221 millions (As at 31 Aug 2019)
60%
8%
15%
15%
2%
BPJS Member - Total 221 millions(As at 31 Aug 2019)
(Eligible) Non paying member
Salary worker & core Family (GovernmentStaff)
Salary Worker & core Family (PrivateCompanies)
Non-Salary Worker & core Family (Incl foreignexpatriate)
Not Working
Paying Member
Membership Categories Example
(Eligible) Non Paying Members This membership is designated by national and local government based on eligibility & socioeconomic profile. Membership is not automatic. Indonesian has to apply & check with local government for eligibility
Salaried worker & Core Family*(Government Staff)
E.g. Police, military, member of parliament etc
Salaried worker & Core Family* (Private Companies)
E.g. staff at private companies
Non Salaried worker & Core Family* Entrepreneur & foreigner who works in Indonesia for at least 6 months
Not Working Investor, employer, pensioners, merdeka generation & their family
Component of BPJS – Member
*Core family means spouse & up to 3 kids. Coverage can be extended to include 4th kids & other extended family (e.g. in laws, grandparents etc) at additional fee
Primary Care Inpatient / Outpatient
Component of BPJS – Benefits
• Preventative Care (e.g. Vaccine)• GP consultation• Non specific medical treatment• Medication• Optic
Outpatient• Consultation, treatment• Specialist medical procedure• Implant • Forensic• Rehabilitation• Dialysis / Blood services• Cancer treatment
Inpatient• Room & Board• ICU treatment• Consultation (attending doctor
and specialist)
Cashless BenefitFirst layer of treatment is Primary Care
Referral letter will be required before entering into Inpatient / Outpatient careThere is no deductible / co-insurance / benefit limits
Component of BPJS – Funding
Paying Member*
(Eligible) Non Paying
MemberGovernment
BPJS(National Universal Health Insurance
Scheme)
Contribution
Cap
ital
BPJS’ network
providers
Polyclinic
General Practitioner (GP)
Public Hospital
Private Hospital
Reimbursement Model
*Paying member include: Salaried worker (Government Or Private), Non Salaried Worker
Component of BPJS – Funding
Paying Member*
(Eligible) Non Paying
MemberGovernment
BPJS(National Universal Health Insurance
Scheme)
Contribution
Cap
ital
• Paying member contribute regular premium to BPJS scheme
– Salaried worker contribute 5% of its monthly salary (4% from employer; 1% from employee). The share from worker is automatically deducted from their salary
– Non salaried worker would need to make monthly regular premium contribution
– Non working would have its premium paid by pension providers (i.e. government)
• Eligible Non Paying member will have its premium being paid by (national/local) government
• Government will act as final guarantor and will make additional contribution when scheme is in deficit. This funding will form part of government’s budget.
*Paying member include: Salaried worker (Government Or Private), Non Salaried Worker
Membership Category Monthly Contribution(As at 31 Aug 2019)
Eligible Non Paying Member IDR 0
Paying Member
1) Salaried worker (+additional family member outside core family*)
5% of Salary (+1% for each additional family member)
Salary cap: IDR 8mn
2) Non Salaried worker Class I: IDR 80,000 (USD 5.3)Class II : IDR 51,000 (USD 3.4)Class III : IDR 25,000 (USD 1.6)
Exchange rate used: IDR 15,000 / 1 USD
Component of BPJS – Funding
*Outside core family means family member other than spouse & up to 3 kids
HOWIs this low contribution premium made
possible?
Membership Category Monthly Contribution(As at 31 Aug 2019)
Actuarial Calculation Government’s Subsidy
Eligible Non Paying Member IDR 0 IDR 36,000 IDR 23,000 (USD 1.5)(the remaining cost is funded by cross subsidy
from Paying Member)
Paying Member
1) Salaried worker (+additional family member
outside core family*)
5% of Salary (+1% for each additional
family member)
6% 1%
2) Non Salaried worker Class I: IDR 80,000 (USD 5.3)Class II : IDR 51,000 (USD 3.4)Class III : IDR 25,000 (USD 1.6)
Exchange rate used: IDR 15,000 / 1 USD
Class I: IDR 80,000 (USD 5.3)Class II : IDR 63,000 (USD 4.2)Class III : IDR 53,000 (USD 3.5)
Exchange rate used: IDR 15,000 / 1 USD
Class I: IDR 0Class II : IDR 12,000 (USD 0.8)Class III : IDR 27,500 (USD 1.8)
Exchange rate used: IDR 15,000 / 1 USD
Component of BPJS – Funding
Government has been paying the bills via subsidy
Source: https://bpjs-kesehatan.go.id/bpjs/dmdocuments/b39df9ae7a30a5c7d4bd0f54d763b447.pdf
Component of BPJS – Funding
BPJS(National Universal Health Insurance
Scheme)
BPJS’ network
providers
Polyclinic
Public Hospital
General Practitioner (GP)
Reimbursement Model
Private Hospital
• BPJS will reimburse the cost incurred by
service provider in delivering service to
BPJS’ members
• Cost reimbursed has been pre-agreed
upfront
– GP: fixed monthly fee per member per
month
– Specialist / Inpatient: Paid according to
fee schedule
– Services: bundled according to
International Refined Diagnosis - Related
Group
• Done via Coordination of Benefit (COB) mechanism
• Benefits offered by Private Insurance• Higher class ward
• Admission into providers who may not be part of BPJS’ network of provider
• Premium• Members who opt for COB pay total premium to BPJS ; Or
• Private insurers collect premium on behalf of member who opt for COB
• Benefit payment• BPJS will cover payment on benefits provided by BPJS’ network of providers
• Private insurers will cover payment on benefits provided by non BPJS’ network
Component of BPJS – Collaboration with Private Insurance
Source: http://www.kresnainsurance.com/index.php/en/newsamm/854-bpjs-insurance-collaborate-with-private-insurance2
BUT….Member still have
to follow referral
process mechanism
before getting into
Inpatient /
Outpatient
treatment
BPSJ Kesehatan has been successful in widening its coverage towards goal of including all Indonesians
But….
Key challenges remain:
1.Ensuring sustainability of the scheme
2.Providing best service to members
Challenges - Overview
Realisation of national universal healthcare scheme
Ensuring sustainability of the scheme
Widening coverage to include all Indonesian
Providing best service to members
BPJS Kesehatan’s Mission & Vision
• Across calendar years, total membership has been growing from 121mn (year 2014) to 221 mn (31 Aug 2019)
• BPJS Kesehatan & government, has been effective in executing its mission to widen the reach of Indonesia national health care scheme towards target of 100% total population of 260 mn lives via;
• Implementation of ID infrastructure
• Enforcement of mandatory membership
• Improving premium payment facility etc
Challenges
Source: https://bpjs-kesehatan.go.id/bpjs/dmdocuments/b39df9ae7a30a5c7d4bd0f54d763b447.pdf
60
121
157172
187
221
0
50
100
150
200
250
300
2005(PT Askes)
2014 2015 2016 2017 2019
Mill
ion
Membership of Indonesia National Health Care Scheme
Total Member (million) Total Indonesia population (Est 2019)
BPJS scheme
What does it mean to Sustainability & Quality of Service?
Challenges - Sustainability
https://asia.nikkei.com/Economy/Indonesia-struggles-to-pay-for-huge-universal-health-care-program
Sustainability
Utilization
Benefit vs Premium
Political Climate
Challenges - Sustainability• Utilization is higher than expected
– Increase in demand as # member increased quickly
– Overconsumption (e.g. choice between Primary care vs Inpatient/Outpatient for patient with controlled chronic condition and patient who live in suburban with minimal medical practitioner)
– Adverse Selection (e.g. skip paying premium until sick, stop paying premium once recovered from elective surgery) and Fraud (e.g. hospital continuously using particular coding to submit claim reimbursement)
– Control of Benefit (e.g. is elective dental treatment & reading glasses medically necessary or cosmetic?)
• Benefits offered is higher relative to actuarially calculated premium. This means, the scheme will naturally runs into deficit
– As at Sep 2019, Indonesian finance ministry is prepared to pump IDR 13 trillion (USD 870 mn) to clear BPJS deficit
• At the end, funding vs sustainability decision depends largely on relevant political climate
– When is the right time to increase premium or remove subsidy? & what’s its impact?
Challenges - Sustainability
Political Climate plays role in Determining Funding & Sustainability
Challenges-Service quality (Anecdotal)
Quality of
Service
Queue Time
Under Capacity
Lack of access to
top specialist
This challenge likely apply to affluent segment of society
• Long queue time (as long as 3 months) particularly for
elective surgery
• Limited BPJS approved ward under private hospitals
– Lack of incentive for providers to join
– Some are concerned about liquidity of BPJS
• Lack of access to specialist doctor particularly those who
practice under private hospitals / GP
• BUT…. this may be view of some but not all members
• 8 in 10 surveyed feels satisfied with service provided by BPJS Kesehatan
• 7.5 in 10 surveyed feels satisfied with medical facility provided
Source: BPJS 2018 annual report
Challenges-Service quality
Majority of member surveyed feels satisfied with service & health facility provided by BPJS
• BPJS scheme (effective 2014) is Indonesia national universal healthcare scheme
• It is run and managed by BPJS Kesehatan (state owned) who ensure smooth operation and financial sustainability of the scheme
• Premium for member from low socio segment will be fully subsidized by government.
• It’s been successful in achieving its aim of widening coverage for all Indonesian
• Challenges remain• Ensuring sustainability of the scheme
• Providing best service to members
Summary
Presented by: Jairus Ng
A Comparison of Universal Healthcare in Singapore and Indonesia
1
Ag
en
da An Overview of the Singapore Healthcare System
2 Financial SustainabilityFund Experience, Source of Revenues, Expenditures
3 Healthcare Equity
MedisaveMandatory savings account funded by one’s income to pay for large inpatient
and selected outpatient bills.Contribute 8-10.5% of monthly salary MediShield Life
National universal healthcare insurance to help with large hospital bills and selected costly outpatient treatments
MediFundFor individuals who have exhausted all
available helpSubsidiesRange of subsidies to keep healthcare affordable
Singapore’s Healthcare Funding3M + S Framework
MediShield Life BPJS Kesehatan
Insured All Singaporean Citizens and PRsAll residents of Indonesia, including
foreigners
PremiumDynamic; Age-dependent, payable by
MedisaveStatic, Depends on Membership
SubsidiesDepends on household income and
age
Contributions for those in poverty or
near poverty are paid by the
government
Coverage
No exclusion but individuals with
serious pre-existing conditions are
required to pay additional 30%
premiums for the first 10 years
No exclusion due to pre-existing
conditions
Inpatient Coverage Yes Yes
Outpatient
Coverage
Yes, specific procedures related to
chronic diseaseYes
Annual Benefit
Limit
S$100,000 per policy year with no
lifetime limitNil
Lifetime Benefit
LimitNil Nil
Deductible Yes, Age and ward dependent Nil
Coinsurance
10% for outpatient; starting at 10%
then decreasing for inpatient and day
surgery, depending on bill
Nil
Universal Healthcare Coverage MediShield Life & BPJS Kesehatan
Key Features of MediShield Life and BPJS in Comparison
(Source: Ministry of Health, Singapore & BPJS Kesehatan)
▪ To provide protection for all Singapore Citizens and PRs against large hospital bills for life, regardless of age or health conditions (Source: Ministry of Health)
1 MediShield Life
▪ Provide the best service to members ▪ Widen coverage to include all Indonesians ▪ Ensure sustainability of the scheme
2 BPJS Kesehatan
Objectives
Financial
Sustainability
Premiums
Investment Income
Revenue
Benefits
Loading Charges
Expenditure
Fund Sustainability
Financial Sustainability is the positive state whereby revenues received exceed the expenditures
BPJS Kesehatan Deficit* (Cumulative)MediShield Life Yearly Claim & Reserve Experience
Financial SustainabilityFund Experience
Singapore Indonesia
As at end 2018, the Medishield Fund is valued at $7.1 billion, of
which three-quarters of the fund comprised of reserve to meet
future claims liabilities and the remainder to safeguard against
adverse scenarios. (Source: Ministry of Health)
The National Health Insurance Scheme (NHIS) has been in deficit
since its first year of inception, and is predicted to remain in deficit
for many years. (Source: BPJS Kesehatan, 2019 Projection)
Claims Paid Change in Reserve Incurred Loss Ratio*
Changes in 2016 due to introduction of MediShield Life
in Nov’15
Incurred Loss Ratio of 98%
over the period 2014 - 2018
Government provided
$724mil in premium
subsidies in 2018
Deficit Amount
According to the Finance Minister, shortfall between
spending and revenues primarily due to non-
payments of premiums from independent
participants
*Incurred Loss Ratio = (Claims Paid + Change in Reserve)/ Earned Premiums *Deficit = Claims Paid – Premiums Received
Financial SustainabilitySource of Revenues - Singapore
Age Employer EmployeeTotal CPF
Contribution Allocation for
Medisave
<35
17% 20% 37%
8%
35-45 9%
45-50 10%
50-55 10.5%
55-60 13% 13% 26% 10.5%
60-65 9% 7.5% 16.5% 10.5%
>65 7.5% 5% 12.5% 10.5%
CPF Contribution and Medisave Allocation
MediShield Life Premiums
▪ MSL Premiums payable by Medisave
▪ Premiums are age-dependent, and it increases with age
▪ 30% loading for policyholders with pre-existing conditions
▪ Range of subsidies available to help pay for MSL premiums
CPF Contributions and allocations rates change to reflect the changing needs as we age.
(Source: CPF Board)
Gradual increase to prepare for healthcare
needs in the old age
Contributions mostly to Medisave
Financial SustainabilitySource of Revenues - Indonesia
Membership Categories
Contributions No. of
Members (Millions)
Payment Collectability
Contributing
Salaried Formal Workers
- Government Staffs
- Private Companies
5% of their salary, up to a salary cap of IDR 12M
(4% paid by the employer and 1% by the
employee)
5195%
(Government)100% (Private)
Non-salaried workers in
Informal Sector
Unemployed
Pay a fixed contribution between IDR42,000 and IDR160,000 per monthly
38 50%
Non-Contribu
tingPBI
Fully subsidised by the government
132 100%
1. Inadequate Contributions
2. Static Contribution Rates that does not reflect changing needs at old age or adjusted for higher risk-profiles
3. No formal avenues to collect contributory premiums, especially from workers in the informal sector
(Source: BPJS Kesehatan)
Membership Contributions and Collectability
Issues related to sustainability
Financial Sustainability
2. Capitation Payment System causes providers to underprovide or over-refer patients
Membership Categories Claims Ratio
Salaried Formal Workers- Government Staffs - Private Companies
105% (G); 70-90% (P)
Non-salaried workers in Informal Sector Unemployed
300 – 400%
PBI 70%
Healthcare Expenditures Singapore
1. Cost-containment measures in place to ensure fund sustainability
2. Fiscal prudency and targeted subsidies
Indonesia
1. High Claim Ratio in the Informal Sector due to Adverse Selection
3. Private-public partnership is required to absorb growing enrolment, however private clinics have higher capitation rates
3. Management of private-public partnership is important to prevent buffet syndrome
Claim Ratio grew quickly
over the years and the industry
experienced a loss margin of 7.2% in 2016.
Which eventually lead
to premium hikes
Healthcare
Equity- World Health Organisation
“Fair opportunity to attain their full health potential and that no one should be disadvantaged from achieving this potential”
Healthcare EquityAccess to affordable healthcare
IndonesiaSingapore
1
2
3
1
2Restrictions and cost containment measures further limit its effect in financial protection
High out-of-pocket expenses, and saving nature of Medisave scheme place greater burden on low-wage earners
Measures in place to bridge the equity gap, and claim limits are periodically reviewed to ensure costs are affordable
Uneven geographical distribution of healthcare facilities limits those living in rural access to quality healthcare services
Improved access to healthcare for the low-income and vulnerable group
Prepared by: Robin Hu
A Brief Introduction on
P2P Mutual Healthcare
Funding in China
39
Background & Product Design
• Background on overall healthcare landscape in China
• Xiang Hu Bao’s product design (Critical Illness)
Product Comparison
• Comparison against Traditional Life Company
• Pros and Cons of Xiang Hu Bao
Product Statistics
• Xiang Hu Bao’s customer profile
• Analyze claim payout rate and premiums
Looking ahead
• Potential market space for P2P product
Overview
Xiang Hu Bao, a 1 year old online mutual aid
platform, has reshaped health coverage landscape
and redefined the definition of insurance
XIANG
HU
BAO
Non-CIRC
REGULATED
CIRC
REGULATED
Traditional Insurance Company
CIRC licensed and Centralized Company,
subjected to C-ROSS Framework
National Healthcare
Security System
Government funded medical
coverage for all residents in China
InsureTech Company
CIRC licensed and Centralized Company,
subjected to C-ROSS Framework
Crowd Funding
Platforms are available to raise
funding to back patients
Charity Donation
Local charity organizations receiving
donations from general public
Current Market Overview
Xiang Hu Bao LaunchXiang Hu Bao is a fully decentralized, blocked chain powered product. It was first
launched on Alipay App in Oct 2018 by Ant Financial, it provides basic protection
against 100 types of critical illness with no upfront premium payment required. Till
now, it has reached a total customer base of 100 Million customers
1 2 3 4 5
16 Oct 2018 1 Nov 2018 27 Nov 2018 8 May 2019 27 Nov 2019
6
31 Jan 2020
TIME ELAPSED
19 13
Launch of Xiang Hu Bao
3 Million signed up within 3 days
CIRC Regulated
20 Million Customers
Within 1 month after launch
Change of Name (保→宝)
No longer under CIRC’s
regulation
Launched Xiang Hu Bao for
seniors above 60s
Achieved 100 Million customers
within 1 year after launch
Free death cover due to
COVID is added
*Xiang Hu Bao requires a minimum of 3.3 Million participants to be in-forced
(per claim SA=300K RMB, 10% expense, min premium = 0.1 RMB, hence the min # of participants to get started = (300K * 1.1) / 0.1 =
3.3 Million)
Fixed Critical Illness Benefit
• Age < 40, SA = 300K RMB
• Age ≥ 40, SA = 100K RMB
Coverage
• Zero upfront premium payment
• Upon claim, participants share
cost
Premium
• Sesame Credit Score > 650
• Age < 60
• Online Health Declaration
Eligibility
• Renewal of scheme is NOT
guaranteed
• Ant Financial can terminate XHB
at its own discretion*
Renewability
Product Design
Health Declaration
Pre-existing
Condition
Medical History
Claim History
No claims history with any insurers for
claims amount of RMB 20,000 &
above. No history of insurance
policy/application ever been declined,
postponed or accepted on special
terms (i.e. loading, exclusion).
In the last 2 years, no history of medication
taking for more than 30 consecutive days or
hospitalization stay for more than 15
consecutive days. Have not received
inpatient treatment or been advised by a
physician to receive inpatient treatment.
• Tumor, cerebral infarction, brain hemorrhage, heart disease,
renal dysfunction, hepatitis (including carrier), liver cirrhosis,
aplastic anemia, SLE, rheumatoid arthritis, hypertension (grade
2 & above with systolic ≥160mmHg or diastolic ≥ 100mmHg),
diabetes, Parkinson’s disease, epilepsy, mental illness,
infectious disease, HIV/AIDS, chronic obstructive pulmonary
disease, paralysis;
• Unconfirmed benign polyps, nodules, cysts, lumps.
Customer Journey
Inceptionof
Xiang HuBao
HealthyMember
ConfirmedPatient
90 DaysWaitingPeriod
Upload Evidence
Ant FinancialVerification
CommunityVerification
SA Payout
Re-reviewedby
Ant Financial
PublicAnnouncement
Auto Deductionfrom Alipay
Eligible forCompensation
300KSubmit Claim
7th and 21st ofeach month
No Objection
Objection
14th and 28th ofeach month
Age < 40
Age ≥ 40 100K
• Family
Alipay platform made it extremely easy to purchase for family
members, hence nearly 20% of sign-ups are through family
• Cancer
54% of claims incurred while one is working away from his
hometown. Out of which, cancer made up the highest claims,
with Thyroid Cancer, Breast Cancer, Lung Cancer as the most
common cancer types
• Youth
More than half of Xiang Hu Bao participants are from the 80s-
90s generation
• Poor
60% of participants come from Tier 3 and below cities which
generally are less developed with limited insurance access.
Their annual income is less than 100,000 RMB
XIANG HU BAODEMOGRAPHIC
Sick While Away from Hometown
54%
Sign-ups by Family
19%
80s-90s Generation
58%
Rural & Suburb Area
60%
Xiang Hu Bao Claim Cost
• Take up rate is steadily growing over the past one year
• Claim cost increased drastically once waiting period finishes
• Huge spikes in claim at XHB’s one year anniversary
• Per person claim cost starts to taper down after one year
Traditional vs Xiang Hu Bao
• Premiums are known and Pre-paid• Centralized Mechanism• Company bears insurance and
investment risks
• Payments are determined post claim• Decentralized Mechanism• Participants bears insurance,
investment and catastrophic risks• Coverage is not guaranteed
8%
Fixed Premiums
Value Chain
100%
Customer
80% 65% 55% 40%
20%
10%
10%
• Customers are paying much more than what protection actually cost
• Xiang Hu Bao’s mechanism by-passes all these charges and bring the basic back to customers, behaves like a mutual
fund with critical illness trigger
Distribution Cost
Management
Expense
15%Cost of Capital
Operating Profit
Protection
Market Integration• Ant Financial covers more than just
insurance, ranging from investment to
healthcare to banking
• Vertical and Horizontal Integration
Accessible Protection• Simple & Intuitive Design
• Affordable Price
• Basic Protection Coverage
Flexible• Join & Cancel Anytime
• Hassle free onboarding
process
Cross-selling• Create Protection Awareness (1 in 6
buys an insurance plan within 6 month)
• Cross-sell other insurance productsHigher Online Traffic• Hot topic of discussion
• Brand awareness
• Higher Conversion Rate
(Policies offered by partner
insurance companies
increase by 60% in sales)
12
4
5
3
Xiang Hu Bao’s Advantages
Floating ClauseDefinition of major illness and payout amount
can be adjusted at XHB’s own discretion.
E.g Thyroid cancer (Early Cancer, 50k SA)
SustainabilityAs participants age, claim cost share
per person increases, how far are
participants willing to share the cost
Anti-SelectionWhen claims increase, healthy lives
leave, unhealthy lives remain, worsen
situation
Non-RegulatedNot recognized as an insurance product,
government can call off this form of P2P
mutual funding and leave participants
unprotected
Xiang Hu Bao’s Shortcomings
How can insurance industry adapt to constant market disruption?
ProcessCumbersome onboarding process
Tedious underwriting questions
RegulationRegulator’s reaction to
market innovation new
entrant
InnovationProduct innovation,
Blockchain Technology
DistributionHigh distribution cost through
traditional intermediated
/advisory based distribution
01 02
04 03
In the near Future
Food for Thoughts?
• Universal Health
• Universal coverage vs Sustainability
• P2P mutual healthcare funding
• Its benefits and shortcomings
Questions & Answers
Postponed: Q2 2021
AUGMENTED ACTUARY:THINK GLOBAL, ACT LOCAL JOINTLY ORGANISED BY
RESORTS WORLD SENTOSA
JOINT SAS-IAAHS
HEALTH CONFERENCE
2020 SAS Conferences
The SAS is planning virtual and land-based conferences in 2020. Tentative plans include:
- Virtual Health & Retirement Conference (August/September)
- Conference Superweek (mid November)- Land-based (if possible)
- Practicing Certificate Seminar
- Volunteer appreciation dinner
- Half-day to one-day conferences by Life, GI, Health, Retirement, ERM, Data Analytics
We thank our 2020 SAS sponsor, China Re, for making the above plans possible. We also need additional sponsors. More sponsorship means we can deliver high quality conferences for our members.
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