Global mobility and people movements have changed significantly since the Covid-19 pandemic hit and with its easing patterns and destinations have shifted focus and direction.
When coupled with major investment and development plans, the panel at the Health & Protection Middle East International Private Medical Insurance Roundtable agreed the region had become a global hub for expats.
Looking at the United Arab Emirates (UAE) to start with, the opening up of immigration and introduction of Golden Visas, the remote working visa and retiree visa have all contributed to a surge in demand, making the emirate much more accessible.
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‘Doubled down on growth plans’
“Post-Covid, we’re definitely on the up and you are probably seeing the same from an international inbound perspective,” said Cigna Global chief distribution officer for Middle East and Africa Leah Cotterill.
She noted that Cigna was seeing particular interest from the retail sector and was recording “stellar months every single month”.
And the growth of the work from anywhere trend has also been a boon to the region.
“I know a few people that have moved from Dubai back to the UK and then returned to Dubai,” she continued.
“Their companies have said, ‘you’ve got a global role if you prefer, go and be in the UAE, it really doesn’t matter whether you fly from the UAE to Singapore and Hong Kong and Paris or from the UK or wherever.
“The visa types and immigration opening has been really significant to SMEs and to the individual segment, while in the corporate space we’ve definitely seen groups growing again quite significantly and then expanding across the region.
“So everyone’s doubled down and now they’re on their next phase of growth.”
New economic reality
But there is a warning that as the country and its employment market develops there has been a shift in economics and the workplace provision that goes with that.
Now many of those moving here are younger, less senior people who do not command the vast salaries of previous years, while employers are not willing to pay them.
As Boyd Edmondson, director, corporate insurance services at Beneple explained: “The mindset of 20 years ago where expats used to come and earn massive salaries and save huge amounts of money through corporate structures, the remnants of that has worked out of the system.
“Now there’s a sense of economic reality to the market here and one needs to just be cognizant of that fact going forward.
“Obviously the cost of living and inflation is stepping up and corporation tax is coming in, so one needs to be aware of how appealing it will be in the longer run, although I agree 100% that we’ve got five to 10 years of real solid growth ahead of us.
“But with the remnants of the past having finished off now, it’ll be interesting to see the transition going forward post-Covid, where there is a sense of reality brought back to the market.”
This means the typical expat arriving in Dubai now has to find the cost of housing and schooling from a smaller salary than they might have once expected.
And this new order has also hit medical coverage with many employees finding themselves being dropped down from tier one plans to tier two or even tier three level coverage.
Outbound expansion hub
However, in a sign of its maturing status in the global economy, the UAE is also becoming a source of talent.
This is manifesting itself in two ways. First as an outbound destination for people to enter other locations.
“We are now seeing the UAE be a talent hub for sending people elsewhere, where you’ve got regional companies that are growing outwardly,” Cotterill continued.
“We’ve got a client based in Abu Dhabi that has recently just opened-up in Singapore and now the UAE is the base for an expatriate group going out to Singapore.
“So we’re starting to see UAE as an outbound destination, not just an import destination.”
And second, this has been coupled with an easing of the need to bring people in to fill roles for organisations as the growing talent pool is providing sufficient experience and expertise.
Where relationships, knowledge of the local market and language capability are increasingly important, this can now be more readily serviced by hiring from the UAE’s population of around 10 million people.
“It’s much safer to hire someone who has lived in the region,” agreed Pacific Prime CEO Middle East and Africa David Hayes.
This demand for people to be internationally relevant was echoed by Chartered Insurance Institute (CII) regional director Middle East and Africa, Central and South Asia Gaenor Jones.
“From an educational perspective, we’re seeing individuals now wanting internationally recognised qualifications as opposed to regional ones,” she said.
“Previously a lot of students here would have gone to regional organisation and got their qualifications, but now they’re wanting CII qualifications so they can go anywhere in the world.
“The quandary is at the moment individuals are paying for their own qualifications and employers will not pay for them.
“Employers are saying if we upskill our employees, they’re going to leave, but I try to educate them, if they don’t support their employees and look after them they’ll also leave.
“So you might as well upskill them, invest in them, look after them, and there’s a chance that they might appreciate you for doing that rather than them going anyway and using you as a stepping stone.”
Growth and cut backs
However, the Middle East and its IPMI market is far more than just the UAE, with many other nations seeing significant growth in their fortunes.
One country tipped for a boom in its economy and subsequent health insurance demand is Egypt.
“Speaking broadly about Middle East, the country that is already growing, but I think is going to boom in terms of insurance benefits is going to be Egypt,” said Jamil Kabbaj Renou, senior vice president – risk management segment and GBM local leader at Mercer Marsh Benefits UAE.
“A lot of companies are moving away from call centres in India, Southeast Asia and so on, to Egypt because they speak Arabic.
“For the region it’s great, labour is cheap, and with the plans of the government to try to enforce something around mandatory insurance, it’s definitely happening in Egypt.
“We’re seeing censuses grow and we’re seeing a lot of investments from multinationals in Egypt today.”
There are though some areas which appear to be being cut back a little, with organisations choosing to make hubs in one or two locations and have skeleton staffs in others.
“I feel like a lot of organisations today are leaner in Gulf countries outside the UAE and Saudi Arabia,” Renou continued.
“They try to manage a lot of things from the UAE, and just have the bare minimum, for example, in Qatar and Lebanon. So we’ve seen a bit of a census reduction in those countries.
“There’s a lot of geopolitical influences and just trying to manage and centralise things a lot more because it’s maybe financially more efficient for a lot of these companies.
“Instead of having several sales leaders, for example, across the region, you have one that manages three or four or five countries, flies in as it’s only an hour trip and doesn’t cost anything, and it’s a lot cheaper to have that.”
Saudi hot spot
But the biggest growing regional power appears to be Saudi Arabia as the state’s continued massive investment in its development projects is gaining in profile and drawing-in people and resources.
“Saudi Arabia is definitely the hot topic in terms of regional mobility right now,” said Neil Carruthers, account director – international people solutions at Lockton Middle East North Africa.
“There’s so much going on in terms of economic growth in Saudi. There’s so much development in regulation allowing for businesses and in fact mandating businesses that want to deal with the government to have their regional headquarters in the nation.
“Lockton is in the final stages of setting up its license in the region, but the number of inquiries from clients over the last 12 months have just escalated towards this point.
“How do they set up an additional arm of their existing insurance here in the UAE to support growth in Qatar, in Oman, in Saudi? Those inquiries are really up this year.”
The intense focus on Saudi Arabia was also acknowledged by other participants as well, with the growing rivalry between the Kingdom and the UAE one of the hottest topics in the region.
“What we noticed in the regional space with the Kingdom of Saudi Aradia coming up is it is the biggest threat to the UAE,” said Ashwin Ramesh, head of employee benefits at United Insurance Brokers.
“We see a lot of the talent pool from the UAE being pushed to KSA, where the transition is purely about giving a better pay package and giving a better role and taking them on quickly.”
This approach has seen businesses grow vastly in the space of months as projects have been won and the need for labour must be met almost instantaneously.
Qatar on hold
A year ago with the pre-World Cup buzz, Qatar was seen as one of the most exciting and potentially high growth jurisdictions in the region.
However, as the advisers explained, the expectation has not yet been met with the hype somewhat tailing off since the tournament’s conclusion in December.
The panel noted Qatar appears to be in a pause, waiting for the next development from the state particularly around its own much-anticipated mandatory health insurance scheme.
The scheme was initially announced in November 2021, but its roll out to tourists, expats and domestically has been slower than originally expected, leaving insurers and advisers waiting to understand the final requirements.
Rachel Slaiby, assistant vice president, senior business development analyst at Marsh Emirates Insurance Brokers, said she was not seeing much activity from the UAE towards Qatar, with this instead being directed towards the KSA, with her team waiting for further developments.
The focus in Qatar appears to remain on making the country into a sporting nation, with the next big event being hosting the 2023 Asian Cup football tournament after the state stepped-in at short notice last year. And then in 2030 it will host the Asian Games.
“So their focus is going to be shifting towards that,” Ramesh continued.
“Even though the hype is not up to the World Cup, that’s where they want to be headed. They want to see, like our vision for the Olympics, they’re putting in investment to build these large stadiums.
“They are very focused and driven in this because the emir of Qatar is very focused on sport, so they’re trying to be kind of a sporting nation of the Middle East and trying to build the economy around that.”
This post-World Cup lull in Qatar was likened to the Dubai World Expo 2020 which was delayed a year, running from October 2021 to March 2022.
While the legacy of both these major world events may not be publicly coming to fruition just yet, with oil prices remaining relatively high, most economies in the region are on firm footing.
And Carruthers highlighted that while many think about Dubai as a tourism hub, it has been a two-decade journey to reach this point.
“This is not a new grab at the non-oil economy, it’s been growing steadily for two decades,” he continued.
“But the non-oil economy for Saudi and the non-oil economy for Qatar, are a relatively new initiative, a relatively new push.
“So it’s going to take time for it to unfold, but it will I’m sure, and it will be very interesting.”
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