In Dubai, from 1st January, medical insurance will have to include cover for pre-existing conditions the Dubai Health Authority has confirmed. Historically when an individual took forward a new medical insurance policy any illnesses or conditions and already suffered from are usually excluded from coverage on the new plan.
With effect from 1st January, those companies providing medical insurance policies to new customers or renewing existing policies will have to cover these pre-existing conditions. What will this mean for a holder of one of these plans? We do not have the fine details yet but as you can imagine this requirement will cause a number of changes to policies and the application procedure. Some well established companies have announced their decision to leave parts of the market altogether.
Looking at applications for life assurance as a proxy, there is an underwriting procedure. This often requires the individual to under-go a medical and tests in order to establish their health. Once the medical report is sent to the insurance company this is assessed and then if the person is not as healthy as an average person for their age etc. an additional premium may be added, or in extreme circumstances cover denied.
As regulation does not permit a medical insurance company to deny coverage and it will be liable for any insured costs, the only option will be to increase the premium for the person insured. For small groups of less than 50 employees and individuals, most insurance companies work on a ‘community rated’ basis. This is a method by which they group all of their customers together to arrive at the rates to be applied. Whether this will continue it is not known.
Another change which is set to come into effect from 1st January is the requirement to have compliant medical insurance for visa applications. This will also be linked to applicant’s Emirates ID. Medical insurance companies and Dubai Government are to use this number to identify applicants. A side effect of this appears to be that it will not be possible for a person to have 2 medical insurance policies.
Why would anyone want two policies I hear you ask? Well, an employer may just give the very basic cover to satisfy the regulation. However you may wish to have a higher level of cover for your family. Additionally, whilst you are in UAE there is no problem with covering pre-existing conditions when you move from company A to company B. But UAE is a transitory place. People move in and out all the time.
If you leave UAE you may find your old employer’s insurance company unwilling to continue to cover you, especially if you are old, have made claims or a chronic condition. I feel that this point needs further thought by the regulators. There are several good reasons why the compulsory medical insurance plan has been brought in but the focus has, understandably, been just on what to do with sick people in UAE and not about the wider implications of the rules on their ability to protect themselves against the cost of medical treatment.
I hope the above is useful. Please let me know if you have any questions or comments.