Insurance law triggers a healthy marketing boom

A marketing boom is set to hit the UAE’s health industry when new laws requiring employers to provide heath insurance for expatriate workers comes into force.

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By  Tim Addington Published  June 25, 2006

A marketing boom is set to hit the UAE’s health industry when new laws requiring employers to provide heath insurance for expatriate workers comes into force. Spending on marketing and public relations is expected to rocket as health insurance companies look to take a slice of the estimated AED1 billion (US$272 million) of new money coming into the market. The General Authority for Health Service (GAHS) in Abu Dhabi has announced that companies employing over 1000 employees must provide health cover for staff from 1 July, while every company in the emirate will have to follow suit from January next year. The other six emirates are expected to introduce similar laws later this year. It is estimated that there are around one million expat workers in Abu Dhabi. The cheapest level of cover provided by the six authorised health insurance providers stands at AED600 (US$163), which means a minimum of AED600 million (US$163 million) being introduced to the market. Mona Samaha, marketing manager at health insurance firm Daman which is one of the approved insurance providers, predicted a marketing bonanza as hospitals and insurance firms look to take their share of that new cash. She said: “Probably 80% of those people will be paying AED600 and the other 20% will be paying at least AED1200 (US$326) to AED1500 (US$408) at least. So it is going to be much higher than AED600 million. We are looking at a AED 1 billion industry. It will be a marketing bonanza. You are going to find a lot of companies ramping up their marketing campaigns, it is going to create new business.” Samaha said that she had spoken to at least 60 advertising, marketing, media and PR agencies in the last five months in preparation for its own marketing drive. “I have met with so many companies, to see what kind of services are out there. “They already know there is business going to be generated as a result of this law and from these insurance companies that have established. “We are setting up a fully fledged marketing department, and two other insurance companies have spoken to me this week to ask us about our marketing activities, because usually their marketing is considered sales. I think insurance companies are now seriously looking at marketing and expanding their marketing departments is being actively considered.” Steven King, PR director at agency Promoseven Weber Shandwick, which is managing the communications for GAHS, said that the law would also have a knock-on effect for hospitals and healthcare providers. “Given a basic marketing budget calculation versus a percentage of total revenues of between 5 and 15%, this means that the marketing power of the health insurance companies alone will be between AED30 million (US$8 million) and AED 90million (US$24 million) per annum. Now that consumers have greater spending power for their healthcare, there will be increased competition from hospitals and service providers.”

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