Health Insurance Market Penetration Low

Studies show that Tanzanians insure property, not their health. A new player in the Tanzanian Insurance Market called Resolution Health East Africa Ltd (RHEAL), wants to change this.
A RECENT study has found that only four per cent of the 126-million strong population of the five member countries of the East African Community – Kenya, Uganda, Rwanda, Burundi and Tanzania – can be said to have some sort of medical insurance cover for themselves and/or members of their families.

The chief executive officer of the Resolution Health East Africa Ltd (RHEAL), Peter Nduati, told Business Times that, basically, this is contributed to by popular apathy. Most people continue to nurture a mindset to the general effect that personal health matters take the backseat, while property – vehicles, buildings, etc – take priority in the insurance stakes!

For his part, a RHEAL director, Leonard Chacha, said "culture is the major problem that hinders many of the local populace from valuing and purchasing health insurance.”

He adds that “it is astonishing to see people preferring to buy insurance for their cars and houses while they won't insure themselves and their families on medical matters!”

In the event, he called upon the peoples of the East African region “to wake up and buy health insurance which is very important to them when they are healthy and working... And even when they retire!”

RHEAL is a Kenya-based company with a presence in Dar es Salaam. According to the Resolution Health country manager for Tanzania, Dennis Lumula, health insurance in Tanzania is lower in terms of coverage than it is in, say, neighbouring Kenya and Uganda. This is basically because the existing service providers target certain markets as a matter of course – especially body corporates, as well as middle and top income earners.

As a result, the majority of Tanzanians – especially low income earners and those living in rural areas – fail to access the opportunities which are already available locally to insure themselves and their families for better health services.

In that regard, the company's group chief executive, Peter Nduati, told Business Times that Resolution Health Ltd would make sure that a healthy lifestyle is promoted in Tanzania, and elsewhere in the EA region, with much confidentiality for its clients.

“ will not rest until we become the market leaders in East Africa,” the man stressed.

Resolution Health East Africa Limited was registered in Kenya in August 2002, and has complied with all the requirements that relate to Medical Insurance Providers.

It was registered in Tanzania under the Tanzania Insurance Regulatory Authority (TIRA), and clearance to do business in Tanzania beginning in 2010 has already been granted by the Commissioner for Insurance at the Treasury. The company has also been registered for operations in Uganda. There are plans to cover the whole EA region and Eastern DRC.

Nduati says Resolution Health “has contracted over 250 medical service providers within the EAC region to ensure that our members have access to medical attention within their respective locations.

In any case, people living outside Tanzania and Kenya – as well as clients who experience health problems when outside their countries – can still access the company's services through its accredited agents spread across the region.

“The company has unique types of products for both individual and corporate clients – all with lower costs compared with the traditional service providers,” Nduati revealed.

Unlike other existing players who sometimes exclude certain health problems in their services, Resolution Health Limited will also cover HIV/Aids – but with special costing, he said.

Through the arrangement, HIV-positive clients would benefit under supplemental cover such as nutritions, preventing pregnant mother-to-child infections, ARVs and the treatment of opportunistic infections.

He said future plans include making Resolution Health a fully fledged insurance company. Nduati said RHEAL would cater for both individual clients and corporate groups... "In both categories, we give members options of getting in-patient, out-patient, maternity, dental and optical services.

“Corporate products are designed for groups and companies with a minimum of ten principal members. The annual limits range from a minimum of US$1,490, up to a maximum of US$29,800. The product can be taken on a 'per-person' basis, on an annual limit – or have the annual limit shared within the family members for both inpatient and outpatient services.

“Our products meet with your requirements by providing unique cover options either for you as an individual, or for your organization.

“Whether you are joining as an individual or as a corporate, Resolution Health shall waive waiting periods for members transferring from another medical provider. The covers given are currently available in Tanzania, Uganda and Kenya – at no additional cost.”

RHEAL also offers discounted spousal rates and additional insurance-based benefits: personal accident, critical illness and daily cash as part of the benefits – also at no extra cost. Commenting on medical inflation, the official said this currently stands at around seven per cent. This is still relatively low compared with Kenya and Uganda where the medical inflation rate is up to 30 per cent! Usually, medical inflation in Tanzania – and, indeed, elsewhere – is caused by investments in medical diagnostic technologies.

However, the issue of regulation in Tanzania has remained a challenge to new entrants in the market. In fact, weaknesses in the extant regulations force some of the new players in the health/medical insurance to unnecessarily incur extra operational costs.

Lumula says the regulations allow a new player to register as an insurance broker or company, noting that this adds costs on the direct charges, requirements and fees imposed in the sector.

All this notwithstanding, however, Resolution Health East Africa Limited announces its increased presence in Tanzania. This is in an effort to boost the medical insurance sub-sector – and, hopefully, get more Tanzanians to insure their health, as well as their cars and houses!

Taken from - http://www.businesstimes.co.tz/index.php?option=com_content&view=article&id=114:health-insurance-market-penetration-low&catid=1:latest-news&Itemid=50