TOP
With a compound annual insurance premium growth rate of over 30% for six consecutive years, RMB817.3 billion-worth of premium recorded for 2020 and RMB2 trillion anticipated for 2025, the health insurance market in China continues to outpace all other lines.1,2
Dread Disease (DD) products account for the largest share of the fast-growing health insurance market in China. And with a relatively high average premium per policy and strong embedded value, DD products has become a fiercely competitive arena among insurers.
In addition to product competition, the value-added health management component of DD products is a renewed focus of attention. Having realised the potential in collaborating with different industries, more insurers are looking to develop a healthcare ecosystem with health insurance at its core.
The market trend ties in with the aims of the Chinese government’s "Healthy China" strategy, which aims to alleviate the pressures of an ageing population on its healthcare systems.
Through this strategy, the government aims to optimize the Social Health Insurance Programme (SHIP) and constrain the inflation of medical costs.
At the same time, it is encouraging commercial insurers to develop health products associated with health management to facilitate collaboration with medical institutions, check-up centers and nursing homes.
The “Healthy China” strategy, which will take shape by 2030, creates an extended period of opportunity for insurers to build out their healthcare service ecosystem and to lay a sound foundation for future growth.
Many insurers have already started, first by tackling the major “pain points” for healthcare services, followed by pursuing integration with other resources and services. Typical services include:
Leading insurers offering health management services are constructing digital health management platforms, often deploying apps to build up a closed loop of healthcare management. Product innovations include targeting niche markets that benefit from a wealth of health data from clients.
At first, most insurers chose to cooperate with third-party health management companies or private hospitals to provide basic value-added healthcare services to clients. Next, they attempted to establish their own data systems to support product innovation and differentiated services.
And now companies with strong capital and advanced technical capabilities in particular have built up their own health management ecosystems, covering the whole life cycle of clients and the complete chain of healthcare services.
Given the huge scale and sustained growth potential of the health market in China, insurers have a huge incentive to continue developing opportunities in health management.
A healthcare service ecosystem constructed by insurers will play an expanding role as the basis for medical expenses control, facilitating more cost-effective management of health insurance operations. Moreover, as insurers continue to integrate healthcare services with elderly care services, they will help create a more holistic health industry framework for the future.
