JEDDAH, 24 May 2005 — The Cooperative Health Insurance Council, chaired by Health Minister Dr. Hamad Al-Manie, yesterday approved five companies to provide health insurance service in the Kingdom, the Saudi Press Agency said.
The council also authorized 117 health institutions across the country — 40 in Riyadh, 11 in Jeddah, nine in Dammam, 14 in Madinah, and three each in Makkah and Jubail — to implement the scheme from June 1.
The first phase will cover 450 companies employing more than 500,000 expatriates. In the phase, the mandatory insurance scheme will be applied to companies employing 500 or more expatriates.
The second phase involves companies with a non-Saudi work force of from 100 to 500, and the third stage affects companies with a non-Saudi work force of fewer than 100.
The council said the second phase would be implemented by the middle of next year and would cover expatriate workers in 2,500 companies. “The third phase will be carried out two years from now and will involve about 60,000 companies and establishments,” it added.
Dr. Reda Khalil, adviser to the minister of health, said the scheme covered most needs of expatriate workers as inpatients or outpatients.
The Council of Saudi Chambers of Commerce and Industry has set up a national center for medical insurance standards which will establish uniform guidelines for health care providers.
The Health Ministry and government agencies currently run more than 200 hospitals across the country.
In addition, there are more than 1,800 government-owned primary health care centers, 25 health institutions, 130 private hospitals and more than 4,000 clinics owned and operated both by Saudis and foreigners.
Ali Abdul Rahman Al-Subaiheen, executive president of the National Company for Cooperative Insurance (NCCI), estimated the current insurance market volume at some SR4 billion with car insurance holding the largest share at 32 percent, followed by medical insurance at 22 percent, property insurance at 17 percent and others at 29 percent.
He expects the market would exceed SR15 billion by 2009 as a result of the growing demand for medical and car insurance policies. Car insurance is expected to grow to SR5 billion and medical insurance to SR6.3 billion within the next four years, he added.
“Saudi insurance market at present contributes only less than one percent of the gross domestic product (GDP) as a result of a fall in per capita spending on insurance to SR150 per year,” Subaiheen said. However, he expected the per capita spending could increase to SR750 per year, thus raising the sector’s contribution to the GDP to three to five percent.
The Saudi Arabian General Investment Authority recently licensed 13 new insurance companies with a total capital of SR2.5 billion.
The licensees include well-known insurance companies from Britain, Germany, Switzerland, Japan, India, Holland, the United States, Bahrain, Jordan, Lebanon and France.
