In light of the continuing challenges and volatility in economic conditions, many expatriates and international companies are now having to take a fresh look at their arrangements for Private Medical Insurance (PMI). Certainly, the PMI market has not remained unscathed through 2009 – although the degree of impact across the market is both debatable and subjective in light of comments and perspectives described in the recent “International PMI – Everybody’s talking about it” article.
At ‘ground-level’ (where you and I are), 2009 was indeed an interesting year, where we saw ‘preference’ and ‘want’ fetch up against the hard wall of reality and sustainability. It is reasonable to expect that the previous ‘comprehensive-cover’ based expectations will inevitably shift in the coming few years to a more value-based orientation in PMI provisions by employers and by expatriates; in much the same way as global buying behavioral trends are shifting from ‘conspicuous consumption’ toward ‘value driven’ and ‘need-based’ purchasing.
Indeed, some companies have already begun looking to lessen their premium burdens by reducing, limiting or adjusting the scope and range of benefits they provide; such as imposing or increasing deductibles, reducing the scope of out-patient care, or even withdrawing spouse and child benefits altogether.
Instead of benefit reduction, some employers are now seriously considering the merits of outsourcing their internal administration of the PMI from HR to the international placement broker, so to reduce payroll burden. This may help alleviate pressure for shrinking PMI benefits and should mean that the employer can sustain or improve its market competitiveness for attracting and retaining quality staff.
For individual expatriates; many are now finding that they now need to make their own PMI arrangements, or need to augment their employer-paid PMI provisions due to benefit shrinkage. With employment markets continuing to be constrained, the need for cost-effective and adequate coverage (as opposed to all-encompassing coverage) is now becoming the priority for many expatriates.
Whether you are a company or an individual; determining, securing, and sustaining an appropriate balance between benefit provisions and cost is no longer as simple as it used to be. If you aren’t already reviewing your PMI, then perhaps you should do so.
