COOPERATIVE HEALTH INSURANCE Octorber 2010, Issue 11

Transcription

1 COOPERATIVE HEALTH INSURANCE Octorber 2010, Issue 11 Claims Management Companies Between the hammer and the anvil Dr. Musaed Al-Salman, Dean of the Faculty of Medicine at King Saud University, King Saud University alone contributes to over 40% of medical studies in KSA Mandatory Health Insurance for Citizens in Private Sector: Conflicting Perspectives

2 Exclusive Agent شركة ا تحاد التجاري للتا مين وإعادة التا مين التعاوني Trade Union Cooperative Insurance & Reinsurance Company Al-Khobar Main office P.O.Box Al-Khobar Kingdom of Saudi Arabia - Telephone: Fax: [email protected] Al-Khobar Tel.: Fax: In the name of Allah, the most gracious, the most merciful And when I am ill, it is He Who cures me True are the words of Allah We offer you Health Insurance services and programs in compliance with the requirements of the Council of Cooperative Health Insurance (CCHI). Riyadh Tel.: Jeddah Tel.: Makkah Tel.: Fax: Fax: Fax: Hufof Tel.: Fax: Editor-in-Chief: Dr. Abdullah Bin Ibrahim Al-Sharif Secretary General of the Council of Cooperative Health Insurance [email protected] CEO: Asst.Editor In Chief Mohammed S. Al Hussain Asst. Gen.Secretary of Admin & Finance of the Council of Cooperative Health Insurance Consulting Committee: Dr. Mansour Bin Nasser Al-Hawasi (MOH) Deputy for Executive Affairs Member of the Council of Cooperative Health Insurance Dr. Mousaa id Bin Mohammad Al-Salman Dean of the Faculty of Medicine, King Saud University Member of the Council of Cooperative Health Insurance Mr. Sami Bin Abdullah Al-Moubarak Representative of the Ministry of Labor Member of the Council of Cooperative Health Insurance The General Secretariat of the Council of Cooperative Health Insurance PO Box Riyadh Phone: Fax: Editor-in-Chief: Associate Editor: Editors: Designer: Publisher: Rabih El-Amine [email protected] Mustafa Shehab [email protected] Amira Hamadeh Said Al-Hasanieh Syed Noori Mohammed Yasmeen Hinnawi Jihad Abu Hashim Alaa Edin Fahmi Distribution: P.O. Box: Riyadh 11372, Phone: [email protected] The reproduction or reprinting of any part of this magazine must have the express permission of the publisher, who reserves the right to initiate legal action against any violation. Editor s note With the expansion of the health insurance sector in Saudi Arabia, there s a lot happening as the past few months have seen several interesting and significant developments taking place in this field, which we would like to share with you. We, at the Cooperative Health Insurance Magazine, strive to meet our readers needs, as well as answer and highlight all their questions and concerns in order to promote the culture of insurance after it has already taken root in every house in the Kingdom. In this edition, our Cover Story focuses on the recent introduction of mandatory health insurance for Saudi nationals working in the private sector. We highlight the reactions of insurance and private companies to this binding decision, and the extent of satisfaction of the beneficiaries of Saudi nationals working in private companies. As you read, you will see that officials in the Secretariat of the Council have offered their candid view in order to put things in the right perspective. We have also conducted an opinion poll to find out just how satisfied employers are with the insurance services offered to their employees so that we get a bigger picture of this vital sector. This month, we introduce a new section called Issue of the Month where we shed light on the role of claim management companies in the insurance sector and their commitment to their role and the insurance sector, in general. Just like we did in our previous editions, we highlight a company operating in the health insurance sector. We also met with the Dean of the Faculty of Medicine at King Saud University, Dr. Musaed Al-Salman, to ask him about services provided by university hospitals, the achievements of this sector, and its readiness to provide medical services in the context of the Saudi health insurance system. In this issue, we give an insight into the various activities of the Dallah Hospital in the context of social responsibility, and their current programs and future plans. There s a section featuring news and developments from the Council and the Secretariat General. We also take a wild trip to cover strange insurance news from around the world and cover the Italian experience in the field of health insurance. In view of the diversity of the insurance sector, we review its performance in the Kingdom, and across the region. In our Finance and Investment section, we look at managing assets for insurance companies, including investment surpluses and savings so as to strengthen the financial status. The beautiful Singapore is our choice for this issue s Travel section. Our Lifestyle section reviews the future of paper books in light of the increasing demand for e-books. We have many other exciting segments lined up for you, such as insurance news and funny stories, and finally, we leave you with a few words of wisdom and poetry. We hope you find the information and topics presented in the magazine useful and insightful. Editor-in-Chief Dr. Abdullah bin Ibrahim Al-Sharif

3 News 6 In the Spotlight 12 Tech World 36 The Council of Ministers in a meeting held on 11/03/1431AH approved the restructuring of the Council of Cooperative Health Insurance (CCHI) for a period of three years, starting on 10/16/1431AH. Solidarity Saudi Takaful Company (SSTC) was established as a joint stock company by the Royal Decree No. M/17 dated 20/3/1430H and a ministerial decision No. 83 dated 19/3/1430H corresponding to 15 March, Finance & Investment 32 A recent study published by the Saudi Arabian Monetary Agency (SAMA) revealed that the total investments of insurance companies in the Kingdom amounted to SR9,189 million. Google s Street View service, which offers 360-degree images of cities and streets, has been at the center of controversies since its launch in While some experts argue that the feature has helped people find locations and reach their destinations as it provides more detailed information than regular maps. Snippets 16 Social Responsibility 22 Lifestyle 40 Report And Analysis 44 Around the World 48 A conservative member of Germany s parliament wants overweight people to pay more for healthcare insurance, arguing that their unhealthy lifestyle is putting too much of a strain on hospitals. Hot Topic 18 Claims management companies play an important role in the insurance sector, especially because they are the link between insurance companies and insurers. Since it was established in 1987, Dallah Hospital, under the parent company (Dallah Al-Baraka) strived to provide community services and social programs including the pioneer program. In the recent years, Internet and computer technologies have revolutionized our life trends in every possible manner. Aided by regulatory authorities efforts, the MENA region s insurance market saw 26 percent compounded annual growth between 2005 and 2008, which was surpassed only by Central and Eastern Europe s 27 percent growth rate. Despite an average reputation and considerable prejudice, even among many Italians, Italy is in fact a country that offers low-cost health care and a good standard of medical assistance. Cover Story 24 Interview 28 Travel & Tourism 52 Two Opinions 56 The Council of Cooperative Health Insurance (CCHI) in its recent meeting held on July 5, 2010, made a very important announcement that would affect a large segment of Saudi citizens working in the private sector. Dr. Musaed bin Mohammed bin Saleh Al-Salman is the Dean of the Faculty of Medicine at King Saud University, University Hospitals Supervisor, and the representative of the university health sector at the Council of Cooperative Health Insurance. Singapore is a cosmopolitan country, and its essence lies in its multi-racial society. Arabs had played a dominant role in South East Asian trade since the foundation of Singapore in In the last couple of years, problems related to failure of medical services and the inability to provide treatment to patients, especially those suffering from chronic diseases, reached a critical point, calling for an immediate solution.

4 News Council s New Structure Approved The Council of Ministers in a meeting held on 11/03/1431AH approved the restructuring of the Council of Cooperative Health Insurance (CCHI) for a period of three years, starting on 10/16/1431AH. The Council will be headed by Health Minister Dr. Abdullah bin Abdul Aziz Al-Rabeeah, along with the membership of the following: Prince Dr. Bandar bin Abdullah bin Mohammed bin Miqren Al-Mashari Al- Saud, representative of the Ministry of Interior; Dr. Bandar bin Abdul Mohsen Kenawy, representative of government health sectors; Dr. Mansour bin Nasser Hawasi, representative of the Ministry of Health; Dr. Mohammed bin Yahya Al-Shahri, representative of government health sectors; Dr. Abdul Rahman bin Abdul Mohsen Al-Khalef, representative of the Ministry of Finance; Othman Bin Saleh Al-Haqil, representative of the Ministry of Labor; Ahmed bin Abdul Rahman Al- Abed Al-Ali, representative of the Ministry of Trade and Industry; Eng. Luay bin Hisham Nazer, representative of the Council of Saudi Chambers of Commerce; Ali bin Suleiman Al-Ayed, representative of Cooperative Insurance Companies; and Dr. Sami Bin Abdulkarim Al-Abdulkarim, representative of private health sector. And the Award Goes to.. Al-Subeih and Al-Gelehem Investment Officer Abdul Majeed Al-Subeih and Reliance Management Officer Abdulaziz Al-Gelehem were awarded the Ideal Employee of the Month awards for first and second quarters of 2010, respectively. They were chosen by the Secretariat of the Council. The Secretary General of the Council, Dr. Abdullah bin Ibrahim Al-Sharif said: This award is part of our motivational programs that aim to encourage our employees to take greater effort in improving themselves, and enhancing the Council s performance. The award is organized by the Secretariat of the Council periodically. Thanking one and all responsible for their success, both the winning employees promised to redouble their efforts in the future. They also thanked all their colleagues for their cooperation and wished them luck and success. Annual Staff Meeting to Raise Morale Second Forum for Cooperative Insurance concludes in Riyadh The Secretariat of CCHI recently held its annual staff meeting at the Holiday Inn Riyadh-Izdihar hotel. Dr. Abdullah bin Ibrahim Al-Sharif, Secretary-General of the Council, attended the meeting, along with assistant secretaries, directors of departments and staff. This annual meeting aims to build bridges of communication between our staff and the senior management. It allows us to listen to the suggestions of our staff and their concerns so as to provide them with an ideal environment to achieve the council s objectives, improve administrative management, and increase productivity, said the Secretary General of the Council. The meeting included activities that aimed to raise the morale of the employees and promote creative energy. The Islamic International Foundation for Economics and Finance recently organized the second forum for Cooperative Insurance, under the leadership of Dr. Abdullah bin Abdul Mohsen Al-Turki, Secretary General of the Muslim World League and Chairman of the foundation. A number of researchers, specialists, and members of the foundation attended the forum, which was also attended by its Secretary General Dr. Abdul Rahman Bin Saleh Al-Atram. In his opening speech, Al- Turki reviewed the objectives of the forum and pointed out the foundation s interest in understanding the major problems facing Islamic companies. The Islamic International Foundation for Economics and Finance is carrying out many economics and finance programs in cooperation with universities, institutions and specialized bodies, he said. We are working to achieve a number of objectives including: unifying principles, rules and concepts of Islamic economics and finance, solving the current financial problems, achieving integration between the foundation and other Islamic financial institutions and promoting the Islamic alternatives for the current financial transactions. He noted that the foundation is using the latest technologies to monitor information, study financial transactions and analyze them from an Islamic perspective. Some of its other activities include: organizing meetings, seminars and panel discussions on current economic and financial developments, exchanging information and studies with economic institutions and Islamic financial centers, providing consultation and training to Islamic institutions, disseminating periodical and non-periodical studies, and forming advisory committees. 6 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 7

5 Saudi Insurance Companies Dominate IPO Market Saudi insurance companies dominated the IPO market in the first half of 2010, as local regulations required they go public within a certain timeframe. New listings are being launched at a slower than expected pace due to continued economic uncertainty and dampened investor confidence, Ernst & Young s IPO update said in a report. The IPO (Initial Public Offering) markets in the Middle East witnessed a low level of activity in the first half of 2010, with the total value of 11 offerings dropping by nine percent to $1billion compared to the same period in 2009, according to Ernst & Young. However, regional IPO markets have shown an increase in the second quarter in a row this year, it said. According to the update, there was a 40 percent increase in total capital raised in the second quarter of 2010 ($590.6 million) compared to the first quarter ($420.5 million). Though the numbers are not at precrisis levels, the trend seems to indicate a movement away from the lower end of the market cycle. In the last three quarters, IPO activity was mainly seen in Saudi Arabia, Jordan, Qatar, Egypt and Syria. To really be on a path to recovery, we need to see new companies reaching out to investors in the other regional markets as well, said Phil Gandier, MENA Transactions Leader, Ernst & Young. The Middle East s largest IPO in the second quarter 2010 was Saudi-based Knowledge Economic City Company. It The cooperative health insurance sector is preparing itself to cover 850, 000 Saudis working in the private sector and their families in line with the decision of the CCHI. The Deputy of the National Insurance Committee, Council of Saudi Chambers, Mohamed Al- Amari, told Okaz newspaper that eligible insurance companies will be able to accommodate all of Saudi employees in the private sector and their families, but the problem remains in the ability of medical centers and hospitals to absorb this huge number. After the implementation of mandatory health insurance for expatriates, hospitals and medical centers were full; now, with the raised $272.0 million, 46 percent of the regional total. The regional IPO market has shown some signs of life on the back of increased Saudi investor confidence and companies in the insurance sector seeking funds. Unless sentiments improve, we believe the number of IPOs in the region will remain at similar levels, said Gandier. A Potential Problem That Could Affect Treatment of 850,000 Citizens in Private Sector addition of Saudis, will these hospitals be able to accommodate such large numbers? he wondered. Commenting on the profitability of insurance companies after the application of this decision, Al-Amari said that insurance companies will definitely achieve more revenues, but they must keep in mind the high cost of treatment in hospitals. Asked about covering Saudi employees in the private sector, he emphasized that all the big companies in the Kingdom, including banks and corporations, had insured their employees, Saudis or non-saudi, years ago, and that the remaining companies are those with a small number of employees. Three Million New Insurance Clients The new decision to cover Saudi nationals working in the private sector and their families would add three million customers to the Saudi insurance market, said Ahmed Khalifa, Executive Vice President, Technical, Al-Ahlia Cooperative Insurance Company. In an interview with Al-Arabiya, Khalifa said insurance companies are now preparing to cover Saudi employees and their families, and foreign workers working in small and medium-sized private companies. He added that eight major insurance companies would capture 50 percent of the new health insurance market, expecting revenues to be between SR2-2.5 billion. The big problem facing the implementation of the mandatory The ACE Arabia Cooperative Insurance Company has recently received a letter from the Saudi Arabian Monetary Agency (SAMA) allowing the company, temporarily, to sell and market 13 insurance products for a period of six months. According to Al-Eqtisadeya newspaper, the products that were approved for sale and marketing are: personal accident insurance, broken Arab insurance companies have regained their balance, according to a statistical report prepared by the Group of Economics and Business. After a decline of 33 percent in the previous year because of the global financial crisis and its repercussions, Arab insurance companies were able to achieve 14.1 percent growth in profits. Gulf insurance companies, according Al-Eqtisadeya newspaper, seized about 85 percent of the total market capitalization of listed companies, health coverage is not related to the capacity of insurance companies to absorb new customers, but it is all about the capacity of health institutions and hospitals to provide services to all recipients of health coverage, Khalifa added. The CCHI has recently mandated private companies to provide health insurance for Saudi employees and their families in addition to foreign workers. It is noteworthy that the Saudi government has allocated SR61.2 billion in its 2010 budget for health and social development services, including establishing eight new hospitals and a number of primary health care centers across the Kingdom, in addition to developing the infrastructure of 19 hospitals. ACE Continues to Work in Saudi Arabia glass insurance, machinery and equipment insurance, loss of profits (machinery disruption) insurance, business interruption insurance, ground transportation (open coverage), ground transportation (one shipment), maritime transport insurance (open coverage), shipping (one shipment), hull insurance, carrier s liability insurance and comprehensive property insurance. Arab Insurance Companies Regain Balance which amounted to $15.88 billion against $12.51 billion in 2008, with an increase of 26.8 percent. Gulf insurance also seized the top ten ranks among the the first four adopted criteria. The total value of the capitalization for insurance companies, according to collected statistics of 111 companies in terms of market capitalization, premiums, assets and profits amounted to $18.69 billion against $15.54 billion in 2008, with an increase of 20.2 percent. News Nevertheless, insurance companies did not reach the record level in 2007 of $21.8 billion, despite the inclusion of new companies. The total premiums of listed insurance companies reached $8.7 billion against $6.9 billion in 2008; an increase of about 26 percent. The Company for Cooperative Insurance (Tawuniya) occupied for the second consecutive year the first ranking in terms of premiums, followed by Oman Insurance and Qatar Insurance. 8 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 9

6 News Mediterranean Insurance Meet Calls for Integration of Insurance Firms The fourth insurance conference for the Mediterranean countries, which include 80 million consumers, concluded its meeting in Beirut last month with new recommendations designed to enhance the performance of insurance firms. Participants called for integration between all insurance firms in the Mediterranean and Arab states. They demanded that more attention be given to high international calibre and the setting up of specialized insurance schools and institutions. Among the recommendations at the conference were the need to spread insurance awareness, promote insurance products that are developed locally and internationally, and meet international quality standards. The participants stressed for the establishment of a Mediterranean investment fund to provide financial support for the expansion activities of domestic insurance companies. Participants said that Mediterranean countries and Arab countries should benefit from the integration between the insurance companies, develop and rehabilitate human resources, and exchange employment and young and technically qualified cadres between different sectors in the region. That, in addition to funding research and studies in the field of insurance in order to contribute to the economic growth in these states, support trade missions across the border, and facilitate access to funds to insurance companies in light of the liberalization trend locally and globally. Fared Shaded, chairman of founder of Shaded Capital, underlined the need for integration between the Mediterranean and Arab insurance companies and its advantages in terms of cost, timing, learning, arbitration and diversity, pointing out to major challenges facing the sector culturally, commercially, technically, politically and socially. He noted that overcoming these obstacles would increase both market size and financial flows. The future is for big insurance groups. In the Mediterranean region, insurance companies need to integrate so as to be able to compete globally. In the absence of funds we need to have new legislations and laws, and we have to exert pressure on legislators in the region, Shaded said to Al-Sharq Al-Awsat newspaper. The absence of harmony and integration between insurance companies and countries in the region, however, could impede the process of integration and weaken competition. Abdalkhalq Raouf Khalil, Secretary General of the Arab Insurance Federation, noted that insurance premiums worldwide had fallen in 2009 by 1.1 percent, while life insurance premiums have declined by about 2 percent because of the global financial crisis. He said that there are positive elements that will increase demand for insurance. Among these elements are rapid population growth, which requires continuous development of infrastructure, privatization of government assets, introducing new insurance laws, as majority of the people are uncovered, the spread of insurance awareness, in addition to the contribution of takaful products in the promotion of insurance services to meet social needs. SAICO Gets SAMA Approval The Saudi Arabian Cooperative Insurance Company (SAICO) has recently got the approval of SAMA to market its medical errors insurance products, according to SAMA letter number 1891/IS dated 24/10/1431AH corresponding to 10 March, Thus, the number of approved products, final and temporary, are 38, according to the report. 10 Shawwal 1431 October 2010

7 In the Spotlight Solidarity Saudi Takaful Company (SSTC) Toward best global standard in insurance sector Solidarity Saudi Takaful Company (SSTC) was established as a joint stock company by the Royal Decree No. M/17 dated 20/3/1430H and a ministerial decision No. 83 dated 19/3/1430H corresponding to 15 March, The company has a paid up capital of SR555 million divided with a nominal value of SR10 per share. SSTC acquired a legal status after it offered an IPO for 22.2 million shares and the issuance of decree of the Minister of Trade and Industry (ministerial decision) announcing its establishment, its memorandum of association and its foundation charter in official newspapers in addition to the issuance of its commercial registration. The company s headquarters are in Riyadh and has branches in Jeddah and Al-Khobar. Vision and Mission The company aims to be a leader in the insurance industry and the best in the region in providing protection to its customers by applying international standards in the insurance sector. It strives to provide insurance solutions and distinctive insurance services in accordance with Shariah and risk management principals. General Strategy Though the insurance industry in Saudi Arabia is relatively new compared to that of other countries, it has grown steadily in the recent years and is now considered a major part of the national economy. The sector is expected to continue growth and expand significantly in the coming years. The new legislations set by the Saudi Arabian Monetary Agency (SAMA) regulating and supervising the activities of insurance companies have played an important role in organizing the sector and building a solid base for a national insurance industry. SSTC seeks to promote the insurance sector in the Kingdom. Because it understands the vital role of the insurance industry in enhancing the national economy, the company strives to develop distinguished insurance products that commensurate with the requirements of the Saudi market and answer the customers needs and demands. It works hard to manage possible risks by analyzing technical factors and providing technical support, in addition to enhancing customer confidence. SSTC strives to fulfill its promises, attract best personnel and maintain the highest standards of efficiency. Moreover, the company looks forward to play a role in training and qualifying young Saudis to work in the various fields of insurance, SSTC aims to be a leader in the insurance industry and the best in the region in providing protection to its customers. and prepare them scientifically and technically so that they have an important function in the future of the Kingdom s insurance sector. One of SSTC s strategies that aims to reach the largest segment of customers focuses on establishing new branches and offices in various regions of the Kingdom in order to communicate directly with customers and provide insurance services, as well as to deal with licensed and accredited insurance brokers, applying the latest and modern means of communications. Shariah Board SSTC formed a Shariah Board, consisting of leading names known for their expertise and competence in Shariah and economy. The board has prepared many studies on Islamic financial transactions, such as Islamic banks, cooperative insurance and Takaful, in cooperation with local, regional and global Shariah boards. The board now directs the company towards a full Shariah commitment in all its offerings and services. Competitive Advantages 1- Large capital SSTC is one of the major contributors in the insurance sector with capital up to SR555 million. Many business leaders have contributed 12 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 13

8 In the Spotlight to its foundation, in addition to support from Solidarity Bahrain. The importance of large capital lies in providing financial solvency in the insurance market and the ability to deal with all insurance businesses and big insurance contracts. 2- Strategic partnership Having Solidarity Bahrain, one of the largest Takaful companies in the world, as one of the main investors in the company provided significant technical support to SSTC. The participation of the founding fathers, mostly Saudis, who represent different companies and institutions in the Kingdom and offer a wide variety of expertise, means trust. After the founding of SSTC, Bahrain Solidarity became a strategic ally and a party in Technical Assistance and Services Convention after obtaining the approval of the Constituent Assembly of the company and the Saudi Arabian Monetary Agency. Determining the details of the Technical Assistance and Services agreement, including the duration of the contract, renewal for a period or other periods, etc. is the responsibility of the Board of Directors, which has the freedom to make the necessary decisions in the interest of the company and its partners. 3-Experienced management The management of SSTC has ample expertise and characteristic administrative and technical capacity in the insurance sector. The company believes that the human element is the most important part of the insurance industry and the reason behind growth and progress, and that investing in this key element is the basis for success. 4- Wide geographical coverage The company has offices in major areas in the Kingdom so as to reach all its customers, providing them with an ease in obtaining insurance services. SSTC intends to further expand in the market, a goal that is clearly reflected in its future plans. 5- High quality reinsurance programs The company has signed a number of agreements with major international and regional reinsurance companies that have great reputation and high solvency as these agreements represent a major part of risk management insurance. 6-Sophisticated information systems Modern information systems are essential in the insurance business, which is why SSTC uses the best and the latest information systems to manage insurance contracts and customer service in style. Services and Products SSTC offers a variety of insurance products approved by SAMA which meet its customers needs in the following categories: 1 - Accident and Liability Insurance: A - Personal accident insurance: This insurance covers personal accidents individual and collective in case of death, injury or disability caused by an external violent incident. B - Work injury insurance: This insurance covers the employer s responsibility for compensation in case of physical injury or death due to work-related accident. C - Liability Insurance: This insurance covers the legal consequences of civil liability by a third party in case of material or physical damage that may occur to them, for which the insurer is responsible. D- Public liability insurance: This insurance covers civil liability, including compensation the insurer has to pay to others because of an accident, property damage because of neglect or defects in the property or its products or because of errors of the profession. E Products liability insurance: This insurance covers the compensation the insurer has to pay to third parties because of physical or material damage on a third party to which the retail product was supplied, distributed, transferred, made, amended, or reformed by the insurer. F- Medical liability insurance: This insurance covers medical errors of doctors or nurses or anyone who works in a medical facility. G- Professional liability insurance: This insurance covers the responsibility of the insured toward a third party due to negligence and unintentional error. H- Insurance against theft and robbery: This insurance covers theft, including loss or damage to insured funds because of a crime of theft. I- Dishonesty insurance: This insurance covers loss involving money, securities and other property committed by the fraudulent act of any employee. J Cash insurance: This insurance covers cash, including compensation for the loss of money belonging to the insurer because of fire, lightning, or theft during transferring the money or while it is in safe coffers. K - Other insurance services 2 - Vehicle Insurance This insurance covers losses and responsibilities relating to motor vehicles (does not include transported cargo): A - Insurance against third party liability: This type of insurance covers damages and injuries that may affect a third party caused by the insured s vehicle. B - Comprehensive insurance on vehicles: This type of insurance covers the damage of the vehicle or damage caused by a third party; it also covers vehicles against theft or damage caused by natural factors such as storms, floods and cold. 3 - Property Insurance This type of insurance covers losses The company formed a Shariah Board, consisting of leading names known for their expertise and competence in Shariah laws and economy. resulting from: fire, theft, explosions, natural disasters, disturbances and any other insurance that falls within this category. 4 - Marine Insurance This type of insurance covers two major types of marine insurance: insurance of goods transported by sea, insurance on ships and possible dangers. 5 - Aviation Insurance This type of insurance covers aircraft hull and responsibility towards passengers and goods transported by air, and any other insurance that falls within this category. 6- Energy Insurance This type of insurance covers oil installations and petrochemical facilities and other energy facilities, and any other insurance that falls within this category. 7 - Engineering Insurance This type of insurance covers contractors, installation and construction risks, electrical and electronic risks, machinery damage and any other insurance that falls within this category. 8 - Health Insurance This type of insurance covers the costs of medicines, medical devices and medical supplies and treatment and management of medical claims. 9 - Insurance Protection This type of insurance covers operations that result in death or permanent/ partial disability. 10 Other services A - Commercial & Export Credit Insurance B - Emergency travel insurance 11 Reinsurance The company can accept optional reinsurance operations only from local companies registered in the Kingdom or in the Gulf in a manner that is in accordance with the SAMA guidelines. 14 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 15

9 Snippets Restart the Wife, Delete the Mother-in-law 90 cm hair insured for $1m German journalist Bernd Oolrman and his wife recently published a book called Pain at Each Step, which included excerpts of the funniest messages received by German insurance companies during the year. In one letter, where a customer has some issues with his insurance company over his mother-in-law, he writes: I attach with my letter a photo of my mother-inlaw, please delete immediately after use. Another customer, confused between his car and wife, asked his insurance company to, extend his contract and restart my wife! A third person called his insurance company to ask for the value of his wife s life insurance, but failed to prove that she is dead because there is no body. When the company refused to pay him, he wrote to them saying, I ask you to agree to pay the life insurance of my wife, I found her under the bed, she is dead. And then a story about a policeman who accused a driver of running over a man and causing him physical harm, without offering him any help. The driver wrote to his insurance company saying: I never ran over somebody and did not offer help, things always happened the other way round, I am the one who always goes to the hospital. A wife wrote to her health insurance company saying: The life of my wounded husband is in immediate danger because one of the doctors wants to scan him under the scanner. A Valentine gift gone wrong It must have seemed like an expensive gift that would make his wife the proudest thing on the road, only had it not ended up becoming a burden. Ian Grice paid 30,000 for a chrome-plated Mini Cooper as a Valentine s gift for his wife Toni. But to the couple s dismay, they couldn t even for once take their new car on a drive. Mr. Grice, 42, could not get anyone to insure the pricey vehicle. I have been left with the world s most expensive mirror, he complained. No one will touch it with a barge pole. At a time when people struggle to insure their cars, properties or life, a cosmetic company has insured football player Troy Polamalu s hair (90 cm) for $1 million. Troy s long hair is considered fashionable, particularly because football players generally do not grow their hair. Polamalu, 29, is Samoan by descent and says he has not cut his hair since German MP: Fat people must pay more A conservative member of Germany s parliament wants overweight people to pay more for healthcare insurance, arguing that their unhealthy lifestyle is putting too much of a strain on hospitals. Marco Wanderwitz, a member of Chancellor Angela Merkel s Christian Democrats (CDU), told Bild newspaper it was not fair for those leading healthier lives to have to pay for those who raised healthcare costs by being overweight. It s legitimate to ask the question if the immense costs that are caused by the excessive consumption of food should continue to be paid for by everyone else, Wanderwitz said, referring to an estimated nine million overweight Germans. No hubbly bubbly for nervous wife A newlywed couple in Amman asked their hotel staff to provide them with a hubbly bubbly in their room, apparently the bride s wish. The groom approached a female receptionist and tried to persuade her how important it is for him to fulfil his bride s request. He told her: My wife is very nervous and she could become really depressed if she didn t smoke a hubbly bubbly. Please do this, I am ready to pay the amount of money you want, please just do it. But sadly, all his attempts were in vain, and the hotel management responded, saying: We apologize for that, but such requests cannot be delivered. 16 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 17

10 Hot Topic Claims Management Companies Between the hammer and the anvil Claims management companies play an important role in the insurance sector, especially because they are the link between insurance companies and insurers. The presence of such companies has become a necessity in light of the significant decline in their numbers in the Saudi market. Claiming the rights of health insurers is one of the most prominent tasks of claims management companies, particularly after the introduction of mandatory health insurance for workers in the private sector, which includes both citizens and residents of Saudi Arabia. But are claims management companies doing their job as they should? And what are the issues they have to deal with on a regular basis? This report answers all these questions and more. Effective claims management is indispensable in order to ensure that policyholders do not violate insurance contract payment terms. Claims management also helps an insurer detect, appraise and monitor financial risks in operating activities. Anwar Manae, personnel director at MedNet, a claims management company, gives an insight into the kind of claims his company deals with. We consider ourselves a link between insurance companies and service providers hospitals and treatment centers. We deal with the administrative and medical issues of each patient individually, he said, adding: As a third party, we manage medical policies, deliver new and renewed policies that enable insurers to benefit from the service provided by a hospital or a medical center. We also ensure that all the bills are settled during the period allowed by the Council of Cooperative Health Insurance, and obtain medical clearance prior to completion of the insured s treatment. Hassan Abdul Bari, Director of Medical Department at Saudi Arabian Cooperative Insurance (SAICO), notes that the system states that prior approvals are not required for emergencies, citing the existence of such approvals as a way to prevent hospitals from offering too many services without medical justification An emergency is a condition that requires medical intervention to save the life of the patient; these conditions not only include bleeding, burns or car accidents, but there are other cases within the same range, such as, cramps, fever and other complications, Abdul Bari said. Importance of Claims Management Companies When should insurers seek the help of a claims management company? Experts point out that according Manae : We have special computer programs designed to obtain the most accurate information and reports upon request. to the new document issued by the Council of Cooperative Health Insurance Council, which identifies medical coverage, insurers should seek the help of a claims management company when he/she encounters any problems with the service providers. At this point, the claims management company tries to solve the problem with the service provider so that the beneficiary is receiving all his/ her rights. Claims companies are also responsible for obtaining medical approvals from insurance companies; although many consider that it is the insured s duty to do the follow-ups. The time needed to issue a medical approval should not exceed 60 minutes, as directed by the Council of Cooperative Health Insurance, which states that approvals should be cleared within 60 minutes at most, or the claim will be implicitly approved. Statistics and Programs Manae explains that MedNet has special computer programs designed to obtain the most accurate information and reports upon request including statistics programs that were developed by MedNet International and are used in all the company s branches around the world. Asked about the number of approval requests SAICO receives on a daily basis, Abdul Bari said: We receive around 800 medical conditions that need approvals, but most of these conditions are uncovered by the insurance policy, so we approve 50 percent of these only, nearly 400 cases. This, he added, is because many of these conditions are not covered by the insurance company and so they do not require approval. Some cases don t require the approval of claims section, such as emergency situations, which cannot be delayed. Key Employee Qualities Highlighting the key qualities that should be possessed by employees working in claims management companies, Manae said: Most of the employees of these companies are university graduates and academics. We at MedNet support Saudi cadres and provide them with the needed training so as to be active in the Saudi labor market, especially in the insurance field. Abdul Bari said that employees in the claims management department must be medically qualified and able to combine academic and professional experience. We hire doctors, pharmacists, nurses, and medical analysis experts so that they are able to understand the medical terminology. Major Obstacles Manae notes that Saudi society is still unaware of the importance of the insurance sector. While some do understand the benefits of an insurance policy, others misuse their policies, and the rest are oblivion of 18 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 19

11 Hot Topic Medical Conditions That Do Not Require Prior Approval First: class VIP+ and VIP do not require prior approval, except in the following cases: - Entry and hypnosis - Treatments costing up to SR Dental and optical services Abdul Bari: We receive around 800 medical conditions that need approvals, but we approve only around 400 of them. their rights and duties. The solution lies in initiating awareness campaigns by insurance companies to educate the beneficiaries on the importance of insurance, he suggests. Abdul Bari confirms that there are many cases of manipulation and exaggeration by some medical departments, doctors and medical workers to obtain approvals of medical insurance for cases excluded by the Council of Cooperative Health Insurance. Many do not know the rules and regulations set by the council, and some workers in medical centers are unable to distinguish between what requires medical clearance and what does not. Therefore, we receive many medical documents (through fax) that do not require prior approvals, causing delay in providing medical service, and ultimately, giving an unreal image of insurance companies, he said. Abdul Bari blames hospitals that suffer from a shortage of qualified personnel for making things difficult. He calls upon the concerned authorities and those responsible for recruitment in these hospitals to exercise precision and caution in selecting individuals, and asks them to subject their employees to training courses in order to achieve the greatest proportion of credibility and professionalism. Few companies approve medical claims within the 60 minutes period set by the Council concerning approvals because some approvals need a medical report from the doctor. All parties should bear the responsibility for delays, he added. Health Insurance System Manae said MedNet started operating in the Saudi market 15 years ago, and that there are many differences between then and now, especially after the issuance of the cooperative health insurance law. The presence of the Council of Cooperative Health Insurance as a lawmaker and an observer of the insurance companies helped companies look more professional and in developing rules and principles that protect all parties. Shortage of Employees Manae attributed the shortage of qualified employees in the insurance field to the requirements established by the legislature as few health insurance claims companies have Official from Sanad: The shortage of employees is due to the lack of qualified specialists, which has resulted in the reduction of the number of claims management companies. been able to meet these conditions, and thus able to continue operating in the Saudi market. An official from Sanad Insurance & Reinsurance Cooperative Company, who requested anonymity, confirmed that the shortage of employees is due to the lack of qualified specialists, which has resulted in the reduction of the number of claims management companies. This in turn led many insurance companies to start processing the claims internally. We at Sanad do not support outsourcing and rather prefer to handle insurance claims internally, he added. Abdul Bari said that the dearth of qualified staff possessing competence and experience in this area is related to the fact that insurance companies do not like to deal with claims management companies and prefer to create their own claims departments. Outlook for the Future In what is clearly a pioneering step, Abdul Bari announced that SAICO Second: class (A+, A, B, and C): - Entry and admissions in the hospital - MRI, CT scan and X-rays - Physical therapy sessions after the first session. - Biopsies - Nerve conduction - Heart tests (ECG) and heart operations - Gallstone fragmentation - External surgeries - Medicines for more than one month -Medical conditions that cost more than the specified are as follows: - (A) SR1000, (B) SR750, (C) SR500 - Dental and optical services - First Pregnancy and last visit is currently working on a new and distinct initiative, which is to hire female specialists as delegates to insurance companies to provide the best medical services for large hospitals and treatment centers. These delegates will help provide, coordinate and facilitate online services in these facilities; which will eventually help insurers get the required approval quickly and easily, he explained. 20 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 21

12 Social Responsibility Dallah Hospital: Decades of leadership in social responsibility Since it was established in 1987, Dallah Hospital, under the parent company (Dallah Al- Baraka) strived to provide community services and social programs including the pioneer program Life Makers in 2001, which offered scholarships for outstanding female students of Dar Al-Hekma. The hospital was a pioneer in launching innovative programs such as the opening of Jeddah Centre for Science and Technology in the mid-eighties, and the launch of Iqra TV channel and other programs that made a quantum leap in the life of individuals and society at large. Today, Dallah Al-Baraka continues what it had started by launching new strategic projects to benefit Saudi society. These include: encouraging scientific research, raise awareness of social and economic cooperation with government facilities, benefiting from the experiences and services of national and international organizations in the areas of community service, etc. In this report, we ask Ahmed Babair, Executive Director of the Dallah Hospital, Riyadh, about the hospital, its future programs and medical services. Dallah Hospital strongly believes that social responsibility programs are an effective way to help society, in addition to providing best medical services, which are in line with international standards. The hospital strives to provide comprehensive training to Saudi medical and administrative staff by offering educational health programs and supporting scientific and social activities such as conferences, lectures, exhibitions, celebrations and more. We have unlimited commitment to social responsibility programs as part of our strategy for the hospital, said Ahmed Babair, Executive Director of Dallah Hospital in Riyadh. We work hard to achieve our goals and to provide new opportunities for social action in light of the technical and telecommunications developments in the social work field. For example, we deduct a percentage from the salary of our employees, who wish to contribute or help the Association for Children with a Disability, he said. Essential Programs The Patient and Family Teaching Center, Community Awareness Services and the National Institute for Specialist Medical Training, are some of the most important social responsibility programs offered by Dallah Hospital. Our Patient and Family Teaching Center offers a special educational service for patients and families. The center provides patients and families with educational tools to know how to live with certain medical conditions and learn more about the proper use of medication, drug or food interaction among other services. This is done by allowing patients to meet with medical experts or attend related lectures and seminars, in addition to giving them brochures and useful publications, explained Babair. The National Institute for Specialist Medical Training is a non-profit establishment and subsidiary of Dallah Company for Health Services. It was established in collaboration with the Loma Linda University to bridge the gap in the labor market in certain health disciplines such as respiratory therapists and others. Among our social responsibility programs, we support the Down s syndrome (DSCA) Charity, and Disabilities Charity by providing free services (follow-up programs for pregnancy and birth) and offer special discounts for its employees, added Babair. Recently, we sponsored the first media campaign for Ensan, the Saudi charity committee for orphans care, which included publicizing the charity and its activities, he said. Moreover, the hospital has participated in organizing advertising campaigns to promote Dallah Hospital opened in 1987 to become one of the largest private hospitals in Saudi Arabia with a capacity of up to 370 beds. We introduced a program to deduct a percentage from the salary of our employees who wish to contribute or help the Association for Children with a Disability. the activities of Prince Fahd Bin Salman Charity Association for Renal Failure Patients and has launched national autism awareness campaigns and training courses. Dallah Hospital has also collaborated with the National College for the Training of Health Professionals (non-profit) to provide training for their employees. It has also sponsored activities in Riyadh, such as celebrations of Eid Al-Fitr and the first meeting of heads of municipal councils. We organize medical awareness days and weeks at the hospital, which include lectures, exhibitions and a variety of other programs, and have sponsored social activities, such as, holiday celebrations and Holy Qur an competitions, in some regions. All praise be to God, all of these programs received positive feedback, said Babair. Beginnings and medical services Dallah Hospital is a major investment of the Dallah Company for Health Services, which was established to provide quality services in line with global standards to suit the unique environment of the Kingdom. Dallah Hospital opened in 1987 to become one of the largest private hospitals in Saudi Arabia with a capacity of up to 370 beds. According to Babair, the hospital has gone through several stages of development, expansion and growth technically and professionally. In 2008, we launched a maternity hospital for women, which has a capacity of 90 beds and 17 outpatient clinics, he said. Today, Dallah Hospital, which employs over 1700 employees, takes great interest in supporting qualified national expertise, and has appointed the best professors and physicians from different Saudi universities to its advisory and administrative boards. In terms of technology, the hospital has been eager to benefit from successful experiences in the field of technology, and to start from where others left off, i.e. Dallah Hospital was the first hospital to use laparoscopic surgery in the Kingdom. The hospital now has the best information management systems and the latest electronic archiving system for X-rays (PACS), which is one of the latest scientific techniques in this area, in addition to diagnostic equipments such as computed tomography and cardiac catheterization. At the level of health services, we have won recognition from major organizations specializing in this field, namely, the Joint Commission International (JCI), as well as the ISO, noted Babair, adding Our centers cover almost all major and sub- specialties. Dallah Hospital has launched many pioneering centers including the Women s Pregnancy Hospital Reproduction Center, Center for Medicine and Cardiac Surgery, Center for Medicine and Neurosurgery, Children s Center and Center for Endocrine Surgery, in addition to general and specialized departments and dermatology and mental health departments. Our Children s Center provides specialties in paediatrics, such as the heart, ear, nose and throat and chest surgery. The hospital also features one of the largest centers specialized in clinical emergency with a capacity of approximately 45 beds, including a children s emergency center and an obstetrics and gynaecology emergency center, Babair said. Dallah Hospital has a track record of several achievements. Some of the most notable ones are: The first private hospital to launch a specialized center for heart surgery and treatment in Riyadh. The first private and public hospital to launch a laparoscopic center. The first private hospital to have a center licensed by the Ministry of Health for the treatment of infertility and reproduction. The first hospital to use electrical stimulation techniques to treat infertility and disabilities in the Kingdom. The first private hospital to open obstetrics and gynaecology training center, which is accredited by the Saudi Council for Health Specialties. The first private hospital to obtain a license from King Abdulaziz City for Science and Technology to handle radioactive materials used in nuclear medicine. 22 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 23

13 Cover Story Mandatory Health Insurance for Citizens in Private Sector: Conflicting Perspectives The Council of Cooperative Health Insurance (CCHI) in its recent meeting held on July 5, 2010, made a very important announcement that would affect a large segment of Saudi citizens working in the private sector. The announcement mandated the owners of private companies and institutions to cover Saudi nationals and their families working in the private sector under the mandatory cooperative health insurance. In this report, we throw some light on the importance of this announcement and its impact on Saudi private institutions and insurance companies. I have medical insurance, but my insurance policy covers few medical services and so I can hardly benefit from it, said Yazed Al- Shemari, a security employee who works in a construction company in Riyadh. For example, most of the nearby hospitals are not covered in my policy, that s why I prefer to go to public hospitals, where I receive better services and medical care than those specified under the insurance policy provided by my company. Raed Anzi, a friend of Al- Shemari, who worked in a service company, said that his problem is bigger than Al-Shemari s. When the Council issued its resolution compelling private companies to cover their employees, my former account manager informed me that the company would deduct SR200 from my salary for insurance. When I refused, because I cannot afford such deduction, the account manager said, It s not your choice, we will deduct the amount whether you like it or not. That s when I decided to leave the company. Thankfully, I found a new job and my present company has provided me with excellent medical insurance without deducting any amount from my salary. Muhammad Alfaifi, an employee in a big private company, is luckier than both of them. I have full health insurance coverage, and my company never deducted any amount from my salary for the health services I receive. My insurance policy is good; it covers almost everything, although I have to pay for medication every time I visit a new doctor, Alfaifi said. Agreeing with him is Saud Al-Hajri, an accountant in a legal advisory office, who notes: I am working with my company for three years now and I have excellent health coverage. My contract had a clause Tariq Al-Mutawa: daily we receive a number of complaints and inquiries from citizens and employers asking about the insurance coverage. in it stating that I am entitled for insurance coverage, and my company was committed. I believe that mandatory health insurance is everyone s right. Naef Al-Shamri, an administrative officer in a private company, says that he did not pay attention to the quality of the insurance policy provided by his company. My father works in the military; and that is why my brothers and I can go to military hospitals, which offer excellent medical care, much better than those provided by private or public hospitals. I cannot assess the level of medical insurance provided by my company since I joined them only three months ago and until now, have not visited any of their hospitals or medical centers. CCHI Satisfied The CCHI is greatly satisfied with the implementation of mandatory health insurance. The Council is very satisfied after the implementation of mandatory health insurance for Saudis working in the private sector and members of their families, said Tariq Al-Mutawa, Director of Rehabilitation at the Council. Although there are some obstacles, the Council is working hard to overcome them, he added. To achieve the maximum benefit from this resolution, we need to strengthen cooperation between all parties. This does not mean that no one is complaining; daily we receive a number of complaints and inquiries from citizens and employers asking about the insurance coverage, how to implement the resolution and who should or should not benefit from it. Asked about penalties on companies that fail to cover their employees, Al-Mutawa said: After we have found out the companies that do not commit to mandatory insurance, we send them a warning. If they continue to ignore their responsibilities, we talk to the labor office, which will impose the necessary sanctions. Usually, the labor office imposes a financial penalty on the facility and stops its operations until it abides by the regulations. Al-Mutawa denied that some insurance companies have refused to cover Saudis. The Council ensures that health insurance covers all groups identified by the system including Saudi nationals and residents working in the private sector. We have not received any complaints stating that a qualified insurance company has refused to cover Saudis. Moreover, insurance companies have no right whatsoever to refuse, they should abide by the law. 24 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 25

14 Cover Story Commenting on the possibility of applying mandatory health insurance on employees working in the public sector, Al-Mutawa said: The application of the cooperative health insurance system is done in stages. It started with residents working in companies with over 500 workers, and then it was applied on more companies with fewer employees. Recently, it has been applied on Saudis working in the private sector and we are studying the possibility of applying it to other categories in the near future. Addressing Complaints Commenting on the contentious relationship between citizens working in the private sector, employers and service providers, Shaya Al- Shaya: A good number of complaints are related to the refusal of the employer and the insurance company to cancel the insurance polices. Shaya Al- Shaya, Director of Irregularities and Complaints at the CCHI, said: The Council is keen on the success of this relationship and that is why we have established the Irregularities and Complaints Department to deal with and receive complaints and examine irregularities, if any, and take the necessary action. He added that the department receives complaints on their website over the phone and toll-free number , or by fax (No: /01). We sometimes receive complaints during the supervision and control field visits carried out by the Council secretariat, Al- Shaya notes. One of the common irregularities people complain related to insurance coverage is unresolved financial claims. We also receive complaints from employees and employers, who are not satisfied with the customer service centers in insurance companies or the poorly qualified reception staff at some service providers, he added. There are also complaints about the blocking of some specified benefits by employers with the approval of insurance companies as in cases of pregnancy, childbirth, dental and physiotherapy. A good number of complaints are also related to the refusal of the employer and the insurance company to cancel the insurance polices, the delay in sending the insured s information to the national authority, the delay in clearing medical claims by insurance companies and the refusal of some companies to cover Saudi employees, especially dependents. According to Al-Shaya, Many are unaware of the mechanism of cancellation of an insurance policy in case of death, transfer of sponsorship, securing alternative insurance with another company, and resignation. Business Owners S. A., a chief financial officer at a private company, who requested anonymity, said that mandating private companies to provide medical insurance for their Saudi employees is a move in the right direction. Some Saudi citizens are delighted with the new system as it will provide them with all the needed medical services, while others see it as a great alterative to public services. Strangely though, some Saudis refused to register their names with insurance companies, without specifying any good reasons, said S.A., while adding: In general, some companies were negatively affected by the resolution as it added an additional financial burden on them, while others were excited about it. Insurance Companies Asked about the repercussions of this resolution for insurance companies, Abdullah Ajlan, Director of Health Insurance Department at Malath Cooperative Insurance and Reinsurance, said, Even before the application of the mandatory heath insurance system, almost all big companies insured their Saudi employees and their families. The medium-sized companies began covering their Saudi employees and their families after the application of mandatory insurance, although some are still covering non-saudis only. Meanwhile, small companies used to buy insurance in order to facilitate procedures with the labor offices and passport departments and they rarely covered Saudi employees, he added. In the last couple of years though, many companies have become more aware of the importance of insurance and some are even demanding for quality services, considering it as a priority, as opposed to the price of the service, which was earlier the main determining factor in their decisions to insure their employees. Mohamed: I am satisfied by the service i get. Ajlan noted that all insurance companies accept to cover Saudis and non-saudis working in companies, institutions and big companies, however, individual and family insurance is largely refused. Individuals usually apply for insurance only if they are to undergo a surgery or when the treatment is very expensive. Our customer services department receives calls from people requesting insurance for their pregnant wives, etc., but after the application of mandatory insurance, everything has changed. Ghassan Abdel Halim, Director of Medical Insurance in the Arabian Shield Cooperative Insurance, talks about the impact of such an obligation on the growth of insurance companies. He explains: As far as our company is concerned, I have not seen a major change in terms of witnessing a growing demand from private companies to insure their employees. Most of our clients are already providing medical insurance to Saudi citizens, much before there was a binding resolution. Commenting on the widespread rumour that some insurance companies are refusing to insure Saudis, Abdel Halim said: I have been working in this field for years, and I never heard of an insurance company that refused to insure a Saudi, because this is a clear violation, and such companies will be held accountable. Maybe some private companies are trying to postpone the application of health insurance pretending that they could not find a suitable insurance company. I understand that some private companies may shy away from insuring employees with big families because of the high cost of insurance or because an employee wants to be covered under a different category that may not commensurate with his professional experience or degree. Such differences could be the reason behind the rumour, he said. 26 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 27

15 Interview Dr. Musaed bin Mohammed bin Saleh Al-Salman is the Dean of the Faculty of Medicine at King Saud University, University Hospitals Supervisor, and the representative of the university health sector at the Council of Cooperative Health Insurance. We met with him this month to discuss a number of issues related to the performance of the Council and the role of the university hospitals in supporting the health insurance sector. We also asked him about the shortage of medical staff and the level of medical services provided by hospitals, in addition to discussing the role of Saudi universities in carrying out medical studies and researches. Dr. Musaed Al-Salman, Dean of the Faculty of Medicine at King Saud University, and University Hospitals Supervisor King Saud University alone contributes to over 40% of medical studies in KSA You represent the university health sector at the Council of Cooperative Health Insurance (CCHI). Tell us more about this representation and the role of this sector. I share the representation of the Council with other colleagues from the public health sector. The university health sector plays an important role in strengthening the experiences of university hospitals and developing researches and studies for the Saudi health insurance sector. Tell us about the current support of university health sector to research and development activities. We have many scientists who publish their studies in several newspapers. I believe that universities are the ones responsible for leading the research and development activities in the health sector. That is why most of the medical researches and researchers are coming from the universities. It is worth mentioning that King Saud University alone contributes to more than 40 percent of health and medical studies in the Kingdom. How will you rate the performance of the CCHI? The performance of the Council is great; it is walking a steady and balanced pace towards a brighter future. Of course, there are some issues that need to be clearer, especially with regards to insuring Saudi nationals who do not work in the private sector. Do you welcome the idea of university hospitals participating in providing health care services under the insurance contracts concluded by the insurance companies? In principle, yes, I think it is a good idea. But we fear that such a move will increase the burden on university hospitals, which could negatively impact the academic process and medical researches. But with the expected increase and expansions of colleges and universities, I think university hospitals will have a greater participation in insurance contracts. You are the Dean of the Faculty of Medicine at King Saud University. From your experience, what is the difference between university hospitals and government hospitals? What is the number of university hospitals in the Kingdom? In terms of the services, university hospitals offer the same services as those offered by government hospitals. The main difference is that university hospitals serve everyone directly and provide primary, secondary and advanced services. They are an essential part of the educational process for students of Faculty of Medicine and postgraduate studies. As for the number of university hospitals, King Saud University currently has two hospitals with a total of 1,000 beds, and in the next two years, we will have 1950 beds serving Saudi citizens and employees of the university and its branches. King Saud University hospital has a track record of quality achievements. For example, the Intensive Care Unit for Children is the only center outside the United States that is internationally recognized to hold training courses in this specialization. Our thoracic surgery at King Khalid University Hospital occupies the second place in the world, after Canada, in performing a very sophisticated operation that involves removing part of the lung using endoscope. The University has also many professors, who have achieved remarkable global presence, including Dr. Mohsen Al-Tamim, Dr. Adel Al-Muqrin, Dr. Faleh Al-Faleh and Dr. Naeem Al- Rahman. Moreover, our surgeons have successfully conducted many quality and unique operations locally, regionally and internationally, including: fixing the inflation in the arcuate artery using stents without having to open the chest or stop the heart and the circulatory system. They were also able to remove a tumour in the right adrenal gland, in addition to conducting 300 operations using the laser to treat varicose veins. We succeeded in removing a large block of the thyroid gland from the back of the chest through a surgical incision in the neck, in addition to removing the colon and rectum of a 60 yearold patient suffering from a cancerous 28 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 29

16 Interview Some issues need to be clear regarding insuring Saudi nationals, who do not work in the private sector. Once the insurance industry develops into a more stable and mature industry, the medical services then should be more specialized. tumour in the rectum using a robot. Our surgeons have cultivated an anal valve for a patient and conducted a rare operation by endoscope on a just-born Saudi infant, and replaced the joint of a shoulder using a new technique. In Riyadh, there are two university hospitals: King Khalid University Hospital and King Abdulaziz University Hospital. Do both offer training for medical students at King Saud University? They both do, and there is no difference between the courses provided by King Khalid University Hospital and King Abdulaziz University Hospital. The establishment of the Faculty of Medicine at the University of King Saud was in the year 1967 by a Royal Decree issued by His Majesty the late King Faisal, and a ministerial decision No. 465, (D/ ). The university opened its doors in 1389H. The University of London helped in selecting the faculty members, and supervised the examinations until the year 1399H. Then, the university signed agreements with different universities in the US, Canada and the UK to support its academic structure, offering medical chairs to train Saudi doctors who graduate from the university and prepare them for postgraduate studies and specialization in various medical fields. In the academic year , the university opened a special section for female students, which was affiliated with the Ministry of Health, to the University of King Saud. In 1395H, the university was renamed to King Abdulaziz University Hospital specialized in training medical students. In 1981 (the twenty-fifth anniversary of the opening of King Saud University), the buildings in the Faculty of Medicine and King Khalid University Hospital were opened at the way to Dir iya creating greater opportunities for both male and female medical students. Where do you agree or disagree with the current practice of health insurance systems in the Kingdom? I believe that the cooperative health insurance is one of the greatest experiments that has been agreed upon in the Kingdom, featuring a health system adopted by the State. We are heading towards a bright future upon completion of the health insurance equation so as to have a comprehensive system for all citizens and residents in the Kingdom. As a doctor, how do you rate the level of medical services provided by hospitals under the umbrella of insurance? I would rate the level of medical services as medium to good. It, however, lacks the accuracy and control to ensure that no one is draining out our citizens or residents; I hope they will change and develop in the future. Are you satisfied with the current insurance coverage? If not, what should be included in the insurance policies? Satisfaction depends on the value of the policy. There is a balance between insurance polices and the provided service at least for now. But once the insurance sector develops into a stable and mature industry, the offered medical services should be more specialized. How do you rate the level of experience of the medical professionals, who graduate from Saudi universities, in general, and King Saud University, in particular? Is it possible to increase the number of graduates to fill the gap between supply and demand? Fortunately, our graduates have all the needed qualities to succeed. Saudi Arabia and King Saud University, in particular, offer the best of medical services in the region, which has contributed to the creation of professional medical cadres and distinct medical institutions, all thanks to the generous support of the Saudi government. During the past years, the Kingdom witnessed a paradigm shift in the health sector including the expansion of hospitals and the opening of new universities and colleges of health to cover all regions across the Kingdom. Saudi Arabia has a record of medical accomplishments. In the next couple of years, as medical schools and health colleges increase in number, we will have enough qualified national cadres to cover the current gaps. Few universities, if any, in the Arab world are known for their medical inventions or discoveries. Why this is so and how are you trying to overcome this in King Saud University? King Saud University takes a genuine interest in developing scientific and research aspects. The university, represented by the Faculty of Medicine and University Hospitals, has cooperated with a number of universities and the world s most prestigious research A brief bio about Dr. Musaed Al-Salman Dr. Musaed Al-Salman is married and has five children (Yara, Madawi, Shaden, Fahed and Saud). In 1413 H and 1418 H, he received the award for the Best Lecturer in the Faculty of Medicine. He has published several research papers in medical journals. In addition to assuming the Deanship of the Faculty of Medicine and supervision of the university hospitals, he represents the Ministry of Higher Education in the Council of Cooperative Health Insurance and is a secretary of the International Association of Heart and Blood Vessels Surgeries/ Middle East and North Africa. He also heads the Standing Committee of Medical Supply at University Hospitals. Dr. Al-Salman is a member of many committees, including: Emergency Medicine and Disaster Committee in the Central region, the HIV Commission, the Committee of Saudi Board in Saudi Authority for Health Specialties, Examination Committee and IT Committee, both at the University. He also represents Saudi Arabia in the Journal of Vascular Surgery Association of Asia (Japan), and is a member of the Disabled Children s Association, and a founding member of the Middle East Journal of Emergency Medicine (Journal of the Medical Tribunal). centers. The product of this cooperation is clear, as we have published many research papers in scientific journals and international periodicals that have received strong resonance in the scientific community. Many studies are still underway confirming the interest of King Saud University in supporting scientific research and expanding research centers. We believe that HR is a critical success factor; therefore, we decided to introduce research chairs, which was a great turning point for the University and contributed to activate the mobility of scientific research. With regard to obstacles facing universities in the Arab world, I think they are primarily financial, and that the availability of funds can help increase research and medical discoveries. The best example is that of King Saud University, where with the availability of the needed funds, the number of researches doubled compared to that in previous years. Tell us more about your recent medical researches. I have authored about 50 research papers, which I presented in a number of international seminars and scientific conferences. These include studies on blood vessels surgeries, carotid arteries diseases, strokes, diabetic foot, and vein diseases. I have also authored several books and translated many others. They can be found on the University Website. What are your hobbies? Reading and walking How do you spend your spare time? I do not get any spare time What is your favourite quote? Too much is as bad as too little, and Science is like light; whoever passes by it gets some. 30 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 31

17 Finance and Investment Managing Assets for Insurance Companies: A Great Leap Forward A recent study published by the Saudi Arabian Monetary Agency (SAMA) revealed that the total investments of insurance companies in the Kingdom amounted to SR9,189 million, distributed on the basis of SR3,773 million insured funds and SR5,416 million from shareholders funds. A number of pertinent questions come to mind, such as, legally, what areas and sectors can insurance companies invest their assets in, what are the main limitations and to what extent can the investment of insurance companies help other industries/sectors. This report seeks to answer all of these questions taking into account the current economic and legal developments in the insurance sector and the Kingdom, at large. Abdulrahman Al-Subaihin, CEO of Tawuniya Cooperative Insurance Company, said that in general, insurance companies should have three basic elements before starting any investment: safety, profitability and liquidity. According to him, the Cooperative Insurance s list of regulations contains a table that shows the ratios of assets per vessel divided between general insurance and protection and savings insurance. Investment in deposits at local banks and government bonds are the biggest investment vessels allowed by law. The allowable percentage should not be less than 20 percent for each of these two vessels in relation to general insurance, and 10 percent for protection and savings insurance. The maximum rates of other investment vessels differ, but they are concentrated in Riyal investment funds (10 percent), investment funds in foreign currencies (10 percent), foreign government bonds (5 percent), bonds issued by local companies (5 percent), bonds issued by foreign companies (5 percent) and investment in equities (15 percent). Al-Subaihin adds: The list identifies the rates allowed to invest in real estate sector, property mortgage loans, and loans to policyholders, while investing in other investment vessels shouldn t exceed 15 percent. Abu Bakr Shehab, finance director of Malath Cooperative Insurance and Reinsurance Co., said that the primary goal of any investment is to achieve greater revenue. In light of this, plans for future investment are designed and criteria of choosing the appropriate investment are determined. Any type of investment carries some risks, as the retention of funds in the form of cash is always risky because it depends on the unstable purchasing power of currencies. Having a good investment policy is the secret, as the policy is the authority that governs Al-Subaihin: By allocating funds to settle down financial commitments, insurance companies will be rest assured that they have enough money to cover claims, payments, reserves and expenses. investment operations, manages investment portfolios and funds and identifies future risks, said Shehab. He said investment policies should be in Saudi Riyals with 50 percent of the total available assets, according to the executive regulations of the control system for cooperative insurance companies issued by the Saudi Arabian Monetary Agency. If the agency did not approve the programs offered by insurance companies, they have no choice but to stick to the investment vessels and the proportions shown in Table 1 in the list of regulations, he notes. Insurance companies also need to have a deposit in a local bank for the benefit of SAMA 10 percent of the paid-up capital within three months from the date of granting the license. Investment companies should invest their funds wisely and optimally ensuring conformity with the regulatory terms and meeting the solvency margin requirements (the increase in assets could be converted into cash), added Shehab. Measuring and Managing Investment Risks Safety and risk are the two words most often heard in matters of investment. There is nothing more desired by investors than safety. Therefore, the management of any insurance company tries its best to preserve the invested capital through careful management, prudent follow-ups and cautious tracking of the investment plan s guidelines. In the early years, insurance companies preferred a conservative policy with low risks and high returns. They focused on investment instruments with fixed income, usually offered by government and semi-government bonds, big corporate bonds, banks deposits, in addition to cash, and Maturities & Asset Class diversity. The assets as indicated in SAMA regulations were more important than high returns. Shehab notes that Malath aims 32 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 33

18 Finance and Investment to increase revenue, reduce risks that may encounter the investment portfolio and boost profitability by achieving the best returns on investment. He adds: We also try to reduce risks associated with low returns, and focus on investments that generate fixed returns and preserve liquidity as stated in our investment policy. We need to maintain an appropriate amount of liquidity to meet operational requirements, settle due claims, meet financial commitments and provide minimum capital requirements. Asked about the efficiency of the system established by SAMA, Shehab highlights a number of points about asset allocation, which is considered one of the most important items of an investment policy. Asset allocation describes the right distributing methods when it comes to invested or planned funds and identifies the limitations, taking into account - when setting up the structure - the proposed duration of the policy and its objectives. Shehab: The investment policy is the authority that governs investment operations, manages investments portfolios and funds and identifies future risks. Shehab explains: When talking about asset allocation, we should look into the structure of the company and its financial commitments as this will influence the strategic asset allocation in terms of volume, value, duration and currency. Financial commitments or obligations, from Shehab s point of view, mean future claims or unknown operational costs. By allocating funds to settle down financial commitments, insurance companies will be rest assured that they have enough money to cover claims, payments, reserves and expenses, he adds. When asked about the time lag between settling and paying claims and re-obtaining reinsurance, Shehab said, Over a medium term, managing liabilities in the Kingdom takes between 24 and 36 months from the date of issuing an insurance policy. Multi-year documents, such as engineering insurance, could take years. Investment Restrictions Commenting on the list of limitations or restrictions on investments, Al- Subaihin says it mainly relates to investment policy, risks surrounding the company, currency used in the investment, asset allocation and ratios. He said the executive list of regulations obliges insurance companies to analyze and study the possible risks including the market itself, credit risks, fluctuations of interest rate and the area/ sector they will operate on a regular basis. Insurance companies must act appropriately to manage those risks or they will suffer huge losses. Risks increase in the absence of efficient information about the cost of financial commitments, return on assets, currency exchange rates, and liquidity risk in this case, the company will not be able to obtain the necessary funds to pay financial commitments because of the inability to sell financial assets quickly and fairly, explained Al-Subaihin, adding it is therefore very important to maintain sufficient liquidity to meet and manage operating needs, operational risks, states risks, legal risks, technical risks and risks of re-insurance. Moreover, the executive list of regulations ordered insurance companies while setting up their investment policy to make sure that the maturity term of their invested assets meets the company s financial obligations, according to issued documents and programs, as each company must submit a comprehensive investment program for assets allocations to SAMA. The list stipulates that no company may use financial instruments such as derivatives and off-balance sheet items before getting prior written consent from SAMA. Insurance companies may only use these financial instruments for portfolio management. These instruments are also subject to liquefaction in a short SAMA report: Total investments of insurance companies in the Kingdom amounted to SR9,189 million. time, based on assets evaluation, and they have clear pricing information. Insurance companies should have sufficient expenses and assets to meet any sudden financial obligations, said Al-Subaihin. Commenting on the systemic risks that could affect the company s investment returns, Shehab said: Revenues may be adversely affected, from time to time depending on the political or economic changes, within the Kingdom or abroad. These changes include fluctuations in the stock market and international reinsurance markets, changes in exchange rates of foreign currencies, natural disasters, accidents, competition, high claims and lofty administrative expenses and overheads. Overcoming Risks Insurance companies can reduce risks by diversifying their investment portfolio by expanding investment channels and economic activities and identifying correlation coefficient between the different components. That is in addition to signing reinsurance agreements with a distinct local and international reinsurance companies, Shehab advices. He also calls upon insurance companies to conduct reviews of re-insurance programs and identify market trends, while maintaining short-term deposits that can be used for claims payment. Moreover, insurance companies should pursue a balanced offering strategy to create a surplus from insurance operations without the need to increase their market share. They should design the structure of investment to match the maturity, liquidity and operational requirement, while keeping a reasonable rate of cash in their current account or sign overdraft agreements with banks, Shehab said. Bright Future Al-Subaihin expects the size of insurance companies investments in the Kingdom to double during the next five years, especially after they pass the establishment phase and start strengthening their investment activities. I expect that the insurance market will recover quickly in light of its success in overcoming the global crisis, the emergence of rebound economies and the incentives launched by the governments to support their economies and get out of stagnation phase faced by the global economy during 2008, 2009 and 2010, he said, adding, Therefore, investment opportunities will help insurance companies to achieve profitability, which will eventually provide great support for the national economy. Seconding Al- Subaihin, Shehab also believes that the insurance sector of Saudi Arabia will witness growth in the coming years and noted that the application of health insurance system and mandatory vehicle insurance will enhance this growth, supported by increasing economic activity and population growth. The market s confidence will lead to increasing liquidity, which will strengthen the invested assets, and by the will of God, will help provide employment opportunities for male and female citizens. This will also benefit companies related to insurance, such as, insurance brokers, investment management, management of claims settlement, advisory and actuarial services, risk assessors and loss valuers, medical service providers (hospitals and clinics), in addition to marketing and research companies, Shehab concluded. 34 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 35

19 Tech World Smile, you re on camera! Google Street View: A history of troubles and privacy issues Google s Street View service, which offers 360-degree images of cities and streets, has been at the center of controversies since its launch in While some experts argue that the feature has helped people find locations and reach their destinations as it provides more detailed information than regular maps others fear that the search engine is invading people s privacy. Google Street View is a Google Maps feature that lets users see images of streets and the surrounding areas, prompting questions about whether it constitutes an invasion of privacy, complaints about inappropriate images, and even a lawsuit. The service was initially launched in five cities around the world, but the number increased gradually to cover more than 40 American cities, including nearby suburbs, and in some cases neighbouring cities. Google dispatched cars and tricycles rigged with cameras, satellitepositioning gear to take pictures of what one might see on streets around the world, and synchronized the images to its free online mapping service. Users can browse these images using the arrow keys on the keyboard or the mouse. Images are displayed in different sizes, directions and perspectives. The service enables users to roam the streets back and forth using the keyboard or mouse to select the horizontal and vertical viewing directions and the zoom level. For example, if you want to visit Trafalgar Square in downtown London, all you need to do is to go to Google Maps and write the name of the arena or zip code in the search box. Within seconds, a map will appear in front of you, allowing you to drag the pegman icon onto the location you want on the map. Google gathers these images by special cameras equipped with 360-degree lenses installed on the roofs of a fleet of cars that roam the streets of cities, and store these images in a database. In Britain alone, Google Street View covers miles of streets and roads. Faces and car number plates are supposed to be blurred out but in some cases are visible. Using cars and tricycles rigged with cameras, Google Street View provides three-dimensional images of cities and streets. Google Street View 36 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 37

20 Tech World commercial purposes but also by criminals. Although it is legal to publish photos taken in public places in the United States, unlike other European countries, the service sparked up a storm after Google admitted its Street View cars, which have been cruising and taking photographs of cities, had inadvertently gathered fragments of personal data sent over unsecured Wi- Fi systems. Microsoft has been playing a major role in advancing cloud computing technology. used to sell its software for local computers only, but in light of rising competition, the circle has widened Invasion of privacy Street View images at Google Maps sparked controversy from the outset of the project three years ago. In South Korea, police raided the offices of Google Korea searching for illegal data, while in Germany, many people worried about the erosion of privacy. People complained that faces could be recognized in Google Street View s pictures, raising the potential of them being caught in compromising situations. Others expressed fears that numbers from license plates could be Microsoft offers a similar Street View service but it is less accurate than that of Google. used to figure out who parks or lives on certain streets. Critics say Google Street View service also invites abuse. They argue that thieves could use it to identify targets, security firms could use it to pitch sales, job seekers might find their homes scrutinized by employers and banks could inspect the homes of loan applicants. The fact that Google Street View service displays close images of the streets of San Francisco, New York, Las Vegas, Miami and Denver stirred a close contest between various websites, which competed to show bystanders in embarrassing positions. Although most of the footage did not include anything immoral, viewers could easily identify their friends or relatives in these images. Private data obtained in this way could be used not only for Recently, several ccomplaints were filed against Google s Street View, including by a woman who was for several years moving house to avoid detection from a former violent partner and was extremely distressed when Street View identified her outside her new home. Two colleagues also sued Google over the publishing of their photos in an embarrassing situation that caused humiliation to them and their partners. A number of UK privacy activists have called upon the government to switch off the service claiming that the photos violate privacy. Simon Davies, director of Privacy International, recently said that Street View has caused clear embarrassment and damage to many residents of the UK. The Internet giant offered assurances that adequate safeguards would be put into place adding that it now uses picture-editing software to blur faces and car license plates in a bid to soothe privacy concerns. Google bows to pressure Although the Internet giant has tried to avoid the problems that have trailed its Street View service, it had to bow to US pressure, when it made some adjustments such as erasing the features of streets like Manhattan and New York and that of other famous streets and areas. Google Street View service has helped many by offering more detailed information than that offered by regular maps. After complaints in the US, other countries warned Google that Street View would have to be modified to comply with their stricter privacy laws. To this end, Google has improved facial recognition technology so that it can find faces in images and blur them so that they are unrecognizable. This technology has also been applied to license plates. The blurring feature has since been applied to US Street View imagery in addition to images in other countries where Street View is now available, including in European cities such as Paris, Rome and Milan. Earlier this year, Google finally admitted that it had made a mistake when its Street View cars collected information from unsecured wireless networks prompting scrutiny from data protection officials around the world. Larry Page, one of the founders of Google, apologized for errors in data collection and mapping service, saying: I am sorry; a mistake has been made, according to newspaper reports. Google Street View service, which was launched in the United States, is now available in Japan, Australia, New Zealand, France, Spain and Italy. The service was recently launched in Netherlands and Britain, where Google Maps has pictures of more than 22,000 miles of streets in the UK. It should be noted that publishing pictures of cities, streets and roads on the Internet is not exclusive to only Google. Microsoft, for example, offers a similar service, which, however, is less accurate than that of Google. 38 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 39

21 Lifestyle Market Competition Set To Heat Up E-Books vs. Print What the Future Looks Like In the recent years, Internet and computer technologies have revolutionized our life trends in every possible manner. The electronic book or e-book is one of the hottest products of these technologies that has affected the way people exchange information, read and write. Many people believe that printed books will never die out and that there are not many takers for the e-books. In this article, we look at the important question of whether the emergence of e-books is a threat to the printedbook industry, as has been believed in the US, Japan and Europe, and also analyze the history and process of manufacturing a book in the electronic format, as well as its advantages and disadvantages. Contrary to popular belief, an e-book is not a new technology. In the early 1990s, e-books were used as a method to store documents and disseminate them among interested groups. E-books are basically text, images, and even audio/video packaged into a single electronic file. The size of e-books can range from a few hundred kilobytes to more than one hundred MB in some cases. With widespread usage of the Internet, laptops and mobile phones, the number of e-book customers has also significantly increased. The Beginnings The idea of the e-book goes back to the early nineties, when one of its inventors, Bob Stein, made a comparison between reading on a computer screen and reading a paper book. He then concluded that reading via an electronic device has many advantages. As expected, some did not agree with his conclusions, saying that the computer weighs more than a normal book as well as citing many other flaws. As years passed by, the disadvantages of e-books became its advantages. For example, there are lighter electronic devices and new software that allow the reader to mark the pages, add footnotes or listen to audio. If the reader is not the type of person who likes to read paragraphs of text, he or she can choose to listen to the audio version. Some e-books even have flash applications that allow the reader to interact with the contents (i.e., drag images around using the mouse). In his book The Electronic Book, Jamal Abdul Aziz Al-Sharhan identifies the main reasons for the popularity of e-books. According to him, when it comes to hard covers, the printing and shipping costs are a major problem, whereas with electronic books, one can simply download them from the web. There With e-books, your file can be easily ed to someone living thousands of miles away. It can even be placed in a public server for anyone to download. is no need to ship any physical product halfway around the globe, and the user does not have to wait as long as he would normally do when ordering books. Al-Shahran also noted that the widespread use of electronic databases, CD-ROM and computers in libraries, information centers and the private sector, in addition to the easy access to multimedia communications have all helped in promoting the usage of e-books. E-books also have a search button, which allows readers to quickly jump to the page containing the word they are interested in. Technological Developments With the introduction of electronic ink or (E-Ink) as a commercial product in , the way we read and view e-books has significantly changed. While we previously used to read an e-book on the computer screen using custom software, we now use specialized ink equipments to read these books, such as Sony reader and iliad. E-books usually use several formats such as HTML, PDF, etc. Some are characterized by advanced technologies such as the ability to add notes and bookmarks. Instead of earmarking pages or marking up your paper copy, electronic copies allow you to add and delete bookmarks and notes. They also come with a chat feature if you want to tell your friend about the book you are reading. Why E-book In fact, some publishers have shown preference for electronic publishing due to several reasons. One, shipping costs or waiting time is nil; two, buying electronically will inevitably save your vehicle s gas by not visiting the bookstore; and third, it saves time that otherwise would have been used in selection of the book, purchase and even reading that can be done in a few minutes in case of an e-book. Not all e-book software is exactly the same, but many of them have similar settings and features that are common, including the ability to adjust the font size, type and background color of your electronic book as per your preferences, add notes, bookmarks, links, audio and images. The text is searchable and can be hyperlinked, you can jump back-and-forth between chapters or the glossary, which some argue is compatible with human learning experience, as we do not learn in a straight line but by jumping between ideas to configure a bigger picture. Many academic and commercial institutions have shown great interest in e-books. Some of these are: Google Books, Open Content Alliance, NetLibrary and Questia. Some universities have even started selling the electronic version of academic books to their students, due to 40 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 41

22 Lifestyle the high price of paper books. A student can now go to the bookstore with his handheld device and download a copy of the book for a certain period. Pros and Cons An increasing number of people are turning to e-books for one or all of these reasons: mobility, spacesaving, convenience, money- and time-saving, and ease-of-use. With disk space quickly becoming a commodity, and the size of portable device hard drives getting bigger and bigger, it is possible to have your entire library with you and access it with your fingertips. E-books also enable readers to link scientific references and quotations. Readers can open and view the citation of the original reference as written by the author of the book in addition to the possibility of using pens and comments during presentations. E-books can also be used in classrooms using a display LCD or a projector, and they can produce multimedia effects such as audio and visual clips, which enhance the experience. Just like a coin has two sides, E-books too have certain disadvantages. They Unlike printed books, e-books contain not only text and images, but also audio and video. require a personal computer or a mobile phone in order to be used. Its data can be lost if its file format is not supported or changed in the reader s computer. Piracy is yet another aspect, which has to be thought of while considering e-books, which often encourage piracy and ultimately reduce the profits of the original book publisher. With e-books, your file can be easily ed to someone living thousands of miles away. It can even be placed in a public server for anyone to download. Many believe that the electronic version of books will never replace paper books because of the intimate feel of paper books. The feel and smell of paper is liked by many. Besides who wants to sit in front of a computer screen for hours just reading an e-book? Aside from putting on extra pounds, sitting for prolonged periods can also cause muscle strain and backache. Today, there are many dedicated software to read e-books, some of which are specialized to fit a certain format such as Acrobat HTML or a specific device such as Firefox or Internet Explorer. Readers need Acrobat Reader to read files in PDF format, while CHM files come with a built-in system in Windows. In addition to these, there are unknown formats such as DjVu, which is known for its ability to reduce the large size of images and scanned books. There is also open source software such as multi-link readers with a panel discussion, which allows exchange of comments between readers on a particular section of the book, or even chat such as dotreader, which can be installed in a laboratory or a college to form groups. As for the hardware, the first known hardware is the traditional computer or mobile device or the PDA. Presently, eight devices are available in the market, and the most famous ones are the Sony Reader and the irex iliad ER Competition Heats Up The battle for the top spot has already taken root among the various manufacturers of e-books, with each one trying their best to woo the readers by providing a suitable reading atmosphere, coupled with comfort and fun. Internet retailer Amazon.com Inc., the world s largest Website to sell books at retail prices, recently said that its electronic titles dramatically outsold hardcover titles in the second quarter this year, with 180 e-books sold for every 100 hard covers. It said that it is now selling 80 percent more downloadable books than hard covers. Amazon s Founder and CEO Jeff Bezos pointed to the recently lowered price of the Kindle ($259 to $189), as the catalyst for the explosion in sales. Amazon sold more than three times as many Kindle books in the second half of 2010 as in the first half of 2009, he said. Kindle books can be read using rival devices, such as the iphone and the ipad, both manufactured by Apple. Amazon noted that it has seen a shift of customers going to e-books that are $9.99 or less. Out of 630,000 books on its website, 510,000 are sold for $9.99 or less. No details on the price of hardcover books were disclosed. Recent studies have revealed that a larger percentage of customers have taken to reading books electronically. A study by Price Water House Coopers has revealed that e-books are receiving increasing interest from readers. It predicted that sales of fiction books in Germany will hit 350 million euros by 2015, equivalent to 6.3 percent of the total book market. The company suggested that the volume of e-book sales during the current year amounted to 20 million euros, according to the company announcement in Frankfurt. The company statement read, E-books will lead the way in Germany, albeit slower than America and Britain. The study authors believe that readers in Germany are still hooked on to the smell and touch of hard covers, and that e-readers are yet not acceptable as a substitute for the printed book. They predicted the number of e-book readers in Germany to reach 2.5 million by 2015, but only if these devices offer important functions such as a coloured screen, Internet access and low prices. The study also revealed that e-readers are still unknown to most Germans. It found that 20,000 people who were surveyed for the study did not know what the term electronic reader means. It stated that these devices are aimed at frequent readers in particular, and it will catch up - most likely with Tablet PCs. The authors advised the German book market to develop new ideas for e-books or the German e-book market will lag behind global companies such as Amazon, Google and Apple. Japanese researchers developed a technology to scan a book as fast as a person can flip through it In the Blink of an Eye Japanese researchers have recently announced the development of a technology to scan a book as fast as a person can flip through it. A prototype ultra-speed scanner capable of digitizing a book in one minute will be built within two years, said the chief researcher of the team at the University of Tokyo s Graduate School of Information Science and Technology. The book-flipping scanning system works with a camera that can take up to 500 photographs per second, enabling it to record about 170 book pages in 60 seconds as a person thumbs through them. We believe this is the world s fastest (scanning) system as far as the technologies already published are concerned, said Yoshihiro Watanabe, who leads the research team. We are considering using robots to turn the pages automatically and more neatly. Japanese printing firms are diversifying into e-books, which can be read using handheld devices such as Apple s ipad tablet computer or Amazon s Kindle. Watanabe said the technology to rapidly capture 3-D images of fastmoving objects could be used in a variety of applications from robotics to industrial and automotive design. The technology could be used for quality control of industrial products. It could also be used to develop a safer and more comfortable driving system. If mounted on a car, this could take 3-D images of obstacles ahead or dents and bumps in the road to avoid them. If loaded into the eyes of robots, they would be able to move much faster than humans. A Revolution in the Making Readers are adopting e-books at a much faster rate after the launch of the ipad Reader. That leaves us wondering whether hard cover books have become the proverbial canary in the coal mine. Despite the fact that e-book sales are still relatively slow, many believe that the book industry is set for the most important revolution in the world of books since Gutenberg invented the printing machine. Only time will tell if we are to finally see the demise of the paper book. 42 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 43

23 Report and Analysis Insurance market grew by 26% between 2005 and 2008 Challenges ahead for Middle East insurance sector Aided by regulatory authorities efforts, the MENA region s insurance market saw 26 percent compounded annual growth between 2005 and 2008, which was surpassed only by Central and Eastern Europe s 27 percent growth rate. According to a new study by Booz & Company, policy makers and regulatory authorities have made progress in promoting the growth, competitiveness and development of the insurance industry in the Middle East and North Africa (MENA) region. The study revealed that several key challenges would need to be addressed to sustain growth and bring the region in line with developed insurance markets around the world. In 2008, the insurance sector in the United Arab Emirates (UAE) was the largest in terms of Gross Premium Income (GPI), representing more than $5 billion, followed by Saudi Arabia with $3.1 billion and Morocco with $2.5 billion. Bahrain, Algeria, and the UAE showed the strongest GPI growth rates between 2007 and 2008, at 46 percent, 45 percent, and 41 percent, respectively. The MENA region s share of the world market accounted for just 42 percent last year. Furthermore, insurance penetration GPI as a percentage of gross domestic product remains low in the MENA region, said Peter Vayanos, a partner at Booz & Company. This ratio grew to 1.08 percent in 2008 from 1.05 percent in 2005, but paled in comparison to every other major region of the world. The industry has made significant progress in addressing these issues, though some critical gaps still exist, stated Roger Kastoun, a senior associate at Booz & Company. Assessing the Development of Insurance Sector In 2006, Booz & Company introduced a framework to assess the development of insurance in the region, identify gaps, and prescribe a set of policy recommendations to be adopted. The framework was based on five key market enablers : Legal framework: Having a robust legal framework in place protects the rights of policyholders, regulates the activities of market participants, and ensures the financial health of the sector; several countries have improved or expanded their legal frameworks. Regulatory bodies: Regulatory bodies are needed to oversee and supervise the sector, and ensure the enforcement of laws and regulations. Today, the region remains a patchwork of sophisticated and underdeveloped regulatory regimes, with Bahrain leading in terms of regulatory oversight. Nature of competition: Innovation, competitive pricing, and the adoption of best practices are all natural outcomes when countries welcome free competition in their insurance market. Today, most MENA countries have more than 20 insurers in operation and are keen on attracting foreign players. Some markets however are still dominated by state-owned or partially state-owned companies, said Vayanos. Skills and training: An adequate insurance knowledge base helps assess the risks to be insured, provides customers with the appropriate products and services, and ensures the availability and development of locally based skills. Two recent initiatives have helped to address knowledge gaps: the Gulf Insurance Institute (GII) that was established recently in Bahrain, and in Qatar, the Qatar Financial Centre (QFC) established a training institute offering accredited courses in several specialist areas, including banking, insurance and wealth management. Market-led initiatives: A vibrant insurance market should be able to stand on its own two feet, with little government intervention. Some markets have attempted to foster the availability of insurance market data and conduct consumer awareness campaigns to promote a better understanding of the market and help attract talent. Insurance market data however is largely unavailable. How to Achieve Sustained Growth Booz & Company has identified four critical objectives that regulatory bodies should prioritize to enjoy sustained growth in the coming years: building the talent base, improving public awareness and acceptance of insurance, fostering the development of takaful and coordinating efforts to harmonize insurance markets in the Arab world. One of the most notable developments in enhancing insurance skills and training in the region was the establishment of the GII in 2007, which offers accredited insurance certificates and a membership system, Booz & Company has identified four critical objectives that regulatory bodies should prioritize to enjoy sustained growth in the coming years. the study stated. Furthermore, the Bahrain Institute of Banking and Finance (BIBF) offers a professional insurance certificate that is administered in more than 11 countries. In 2008, the BIBF launched a new takaful certification program accredited by the Chartered Insurance Institute (CII), the first such certification in the world. The study also stressed that the region should strive to reach a point where universities and private training centers offer multiple insurance degrees and certifications to accommodate the needs of students and professionals, and to target a wider range of individuals interested in pursuing insurance studies. This will guarantee an abundant supply of qualified personnel to meet the region s growing demands of market participants and regulatory authorities, said Vayanos. Enhancing Public Awareness Arab countries have initiated a limited number of public insurance awareness campaigns. Notable exceptions include campaigns in Lebanon and Jordan. As a result, insurance penetration in Lebanon and Jordan at 3.4 percent and 2.3 percent, respectively is among the highest in the region. Other MENA countries public awareness forays have been limited to the publication of monthly bulletins and market surveys, but these do not reach all potential policyholders and more initiatives are needed to spur demand. According to Kastoun, Authorities can derive lessons from international best practices and employ consumer surveys to measure the level of knowledge and acceptance of insurance. This will help reveal areas of weakness to be addressed in future outreach campaigns. Conducting such surveys regularly will also enable regulatory authorities to measure the evolution of market awareness and adjust their communication strategies accordingly. Regulatory bodies should support public awareness campaigns that target specific audiences and are tailored to the needs of each jurisdiction. Developing Takaful The study by Booz & Company 44 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 45

24 Report and Analysis said that Takaful, Islamic insurance, is emerging as an increasingly important form of insurance in the Arab world. The GCC region is currently the world s largest market for takaful, representing over 59 percent of all takaful premiums written in The 26 percent compounded annual growth rate of takaful premiums between 2004 and 2007 matched that of conventional insurance markets over the same time period. To achieve the region s full takaful potential, the following need to be in place: Regulation: Insurance regulators should coordinate with leading takaful authorities and representative bodies in the MENA region and elsewhere, to develop regulation guidelines for Takaful and re-takaful. Accounting standards: There is a need to implement takaful-specific accounting best practices in all MENA countries to ensure transparency and protect stakeholders interests. Public awareness: Insurance regulators should develop consumer education programs on a regional basis, set up informative websites about takaful and retakaful and their related benefits, and work with leading media outlets to inform the public. Skills and training: Insurance leaders should support the development and promotion of national and regional Islamic finance centers that offer certifications and degrees in takaful. Similarly, takaful-specific courses should be added to existing insurance curricula. Products: Regulators must take steps to encourage investment in product development. Vayanos explained: Most insurance companies have their own Shariah boards to validate the compliance of takaful products with Islamic law, which should be augmented by the establishment of national authorities to certify the alignment of takaful products with Islamic law. Distribution channels: Insurers should look to explore new distribution channels such as Bank Takaful, the distribution of takaful products via banks branch 46 Shawwal 1431 October 2010 networks, and develop marketing events and other initiatives to reach the corporate and public-sector segments. Corporate governance and risk management: Companies are leery of the negative image incase a lack of understanding about Shariah leads to non- Shariah compliant products being sold inadvertently. One solution would be the creation of a regional authority to oversee Islamic corporate governance and risk management issues and disseminate topicrelated guidelines in collaboration with leading Islamic institutions such as the Islamic Financial Services Board (IFSB). Promoting a Regional Insurance Market The study identified the objective of Arab regulators, which is to develop a regional insurance market. To achieve this, policymakers and regulatory authorities in the region must work together to harmonize legal frameworks and ensure that supervisory standards are on a par with international standards. Organizations such as the Arab Forum of Insurance Regulatory Commissions (AFIRC) have taken significant steps to harmonize insurance markets in the Arab world. AFIRC, which brings together 16 Arab countries have initiated a limited number of public insurance awareness campaigns, but the most notable campaigns were in Lebanon and Jordan. Arab countries regulatory authorities, aims to promote collaboration, transparency and adoption of international standards among regulatory authorities in the region. AFIRC and Hawkamah, both strive to bridge the governance gap by assisting the regions countries and businesses in developing and implementing sound corporate governance frameworks. AFIRC and Hawkamah have established a joint task force to conduct a corporate governance assessment of the region s insurance sector, develop corporate governance guidelines, and expand the industry s corporate governance capabilities. Such organizations are expected to assume increasingly significant roles in the development of the industry because of their efforts to support the adoption of international standards and best practices in the region. Growth Plan With MENA insurance expected to grow throughout the coming years, policymakers and regulators will have to address the challenges that lie ahead for the region to capture insurance s full growth potential, said Vayanos. They need to develop an insurance talent base, foster the development of takaful, create and improve public awareness about insurance and support the growth of a regional insurance market. To achieve these goals, the study suggested that policymakers and regulators should act locally, regionally, and internationally. Locally: By working closely with insurance companies, service providers, and other industry stakeholders to ensure a close oversight of their activities, yet providing enough room for them to grow organically and inorganically. Regionally: By working with regulatory authorities of the MENA region to promote transparency, collaboration, and implementation of international standards. Internationally: By collaborating with standard-setting bodies to move understanding of regulatory and supervisory matters further. 60 Muharram 1431 Janaury 2010

25 Around the World Italian health care: Second best health insurance in the world Despite an average reputation and considerable prejudice, even among many Italians, Italy is in fact a country that offers low-cost health care and a good standard of medical assistance. Italian doctors are dedicated and well-trained and the best private hospitals here are at par with that of any country. State hospitals, however, particularly in the south of Italy, are considered unreliable due to a lack of creature comforts, which are thought to be well below the American and northern European standards. Therefore, many foreigners as well as Italians obtain private health insurance, which covers the costs of hospitalization and surgery, in a comfortable environment, and more importantly to avoid the long waiting lists that are a norm in the state system. Latest figures indicate that Italy spends less on health care than 15 other European nations, which allocate 9.2 percent of their GDP compared with Italy s 8.7 percent. This figure is even less than the Organization for Economic Cooperation and Development average (8.9 percent). The Italian public health care system is ranked second worldwide, according to the WHO. According to 2003 figures, Italy is home to approx. 30,130,0 inhabitants. The life expectancy is 76.9 years for men and 82.9 years for women. The infant mortality (per 1000 life-births) is over 4 percent, which is relatively high. National Health System: SSN Italy s national health system Servizio Sanitario Nazionale (SSN) is administered through local health authorities and provides low or no-cost health care to all EU citizens, which includes in-patient treatment, family doctor visits and medical assistance provided by pediatricians, obstetricians and other specialists. It also pays for part, sometimes all, of the cost of drugs and medicines, out-patient treatment and dental treatment. Emergency health provision is available to all EU and non-eu patients. Regardless of where an individual comes from, he must have some form of health insurance as soon as he arrives in Italy. A stay permit (Permesso di soggiorno) will not be issued without it. The beginnings and reforms Italy s strong North-South divide (rich North, poor South) and a dynamic political scene have influence on the country s health service. Italy has a governmental medical service. In 1970 Italy had approx. 100 different health insurances, abolished in Then, the government medical service SSN (Servicio Sanitaris Nazionale) was introduced, which encompasses all citizens. Non-cash benefits and services were made available free of charge. The original idea was to introduce the SSN in order to create a unique service offer, to get rid of the North-South divide and to lower the costs. However, this plan did not materialize. The SSN was subject to four reforms since its founding. The basic principle is that health is not only the fundamental right of all people but it is also regarded as the state s public interest, protected with the help of the SSN. All citizens (registered at the SSN) are entitled to receive health care. Everyone has to be treated with the same dignity, regardless of his social position. Everyone in need has to receive medical treatment. The health service aims at the following: creation of a modern health consciousness among all citizens; prevention of illness and industrial accidents; security at work; diagnosis and curing of illnesses; rehabilitation; food hygiene; protection against illnesses concerning stockbreeding; job-related further education for health sector employees; and protection of mother and child. In Nov. 30, 1998, important changes within the medical service came into force. The health system became federalist. Regions became responsible for management and organization and municipalities began to play a more powerful role. Organization The health system operates at three levels: National, Regional and Local. The organization is heavily decentralized. The regional government is responsible for planning, financing, control and supervision. The parliament is responsible for the framework of the SSN. a) National (central) level: Operating at this level, the ministry of health is responsible for accomplishing the SSN objectives (health plan). All regions will receive full autonomy step by step until Compensating the weaker regions is also in the cards at the national level. Another task of the ministry of health is the control of the drug market and research. b) Regional level: The regional government draws up a regional health plan every three years, which includes ways to distribute financial resources among local health units and hospitals. They adapt themselves to the health plans of the USL (local level). The regional government also controls efficiency, quality and checks provision of service through public and private health organizations. c) Local level: On the local level, various local medical units called USL (Unita Sanitarie Lokale) or ASL (Aziende Sanitarie Lokale) operate. They number at around 200 and approx. 50,000 20,000,0 people are assigned to each of them. The units are self-governing. At the local level, health benefits are still provided by trusts, hospitals of the IRCCS and private hospitals. Every citizen has to register at the USL. It is necessary to come in person. After registration, an individual receives a health card that makes it possible for the insured party to choose a general practitioner - doctor as a primary contact person as well as the procuring of various licenses necessary for health care. This card also makes it possible to receive necessary exemptions, depending on the illness. Financing Usually a governmental health service is financed through public resources but this is not entirely the case in Italy. Only 37.5 percent comes from public resources, 40.8 percent from health insurance contributions paid by the employer (2.88 percent of the gross earnings) while the rest from additional private payments. Services Cash benefits: In order to receive a sick pay, an inability to work must be confirmed by a doctor. The maximum payment period is six months. The patient receives 50 percent of his gross earnings between Day One and Day 20, and from Day 21 he receives percent of his gross earnings. Non-cash benefits: All citizens are entitled to receive non-cash benefits. The insured party chooses a general practitioner. Regular services in government health centers are carried out without additional payments. Additional payments, however, are required for many kinds of medicine as well as for specialist services; such as, pharmaceutical care, 48 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 49

26 Around the World Dictionary services of an established specialist, etc. The costs for dental treatment will not be covered. The citizen has to pay the entire amount. Other services Services of a medical auxiliary e.g. nurse, chiropodist or physiotherapist, are available through a referral from the family doctor. Free counseling for family and relationship problems, which includes pre- and ante-natal care, is also available through a network of local health centers, where appointments can usually be made without the need for a doctor s referral. How to get insured For an employee working in Italy, the employer will pay for his health insurance. All he needs to do is go to his nearest health authority and register with a doctor. Once registered, he will receive a health number and a health card, after which all visits to the family doctor will be free. In case of an EU citizen visiting Italy, he can take advantage of reciprocal health agreements. Before arriving, he should apply for a certificate of entitlement to treatment (form E111) at least three weeks beforehand. An E111 is no substitute for full holiday insurance, however, and therefore, a separate policy is still required. In case of a non-eu citizen visiting Italy, he will need to have private insurance cover. He should go to the local police station within eight days of arrival and show a health policy (either Italian or foreign) which is valid for the duration of his entry permit. The individual is required to pay in full for any medical treatment first before making a claim via his insurance company. Those who are self-employed, retired or studying, and necessarily have residency in Italy, have the same rights as an Italian and don t need to take out private insurance. Once registered, the local doctor can be visited during work hours and appointments aren t usually required, with most doctors operating on a firstcome-first-served basis. If consultation with a specialist is required, the doctor will give a referral. Specialists usually work in local hospitals, though some private doctors who have an agreement with the health authority also operate from private consulting rooms. The national health system provides for visits to many different specialists (including reduced cost spa treatments), though it s advisable to pay for private dental treatment. Drugs and medicines Expenses for drugs are relatively high when compared to other European countries. Italy and France top the list in this matter. The family doctor issues prescriptions of drugs and medicines, which can then be shown at a pharmacy. Pharmacies in Italy are small family-run businesses and deal in medically-related items only. Those having state health cover will qualify for the subsidized charge (known as ticket ) and pay reduced costs. Otherwise, one needs to pay the full cost. Hospitals State hospitals in Italy can be depressing places, with inadequate nursing back-up, though basic hospital accommodation can always be relied upon. In case of hospitalization, one needs to produce a doctor s referral and, if he qualifies for state health cover, it will be free. Some hospitals in Italy offer specialized treatment and, under the national health, one can ask to be treated in a hospital in another city. Emergencies In an emergency, an individual must go to his nearest casualty department and wait to be treated. If he is unable to do so, he must call 118 and the appropriate medical service will be sent to him. However, if the medical problem is not considered an emergency, he will be asked to pay for the treatment. Demand for private cover Many Italians as well as foreigners in Italy prefer private health insurance over the basic state cover. With private insurance, they are free to choose any doctor or specialist and be treated in private hospitals, avoiding long waiting queues. In private hospitals, accommodation is similar to 5-star hotel accommodation (air-conditioned rooms, with en-suite bathrooms and extra beds for relatives) and visiting hours are usually unrestricted. However, the quality of medical care is likely to be the same as in public hospitals (doctors often work for both the state and private system) although they don t necessarily have the most up-to-date medical equipment and may lack vital life-saving equipment in the event of an emergency. Note that treatment in private hospitals in Italy can be very costly. It is important to check beforehand whether one s insurance company covers a particular type of treatment. Some regions, including Lombardy, have reached agreements with certain private hospitals allowing National Health patients to get treatment at the cost of the SSN. This has shortened the queues at public hospitals, but lengthened them at private ones. Generally, permission of the regional authority is required before taking advantage of this possibility. However, a recent court decision laid down that patients whose life is endangered by excessive delays in the availability of state health care can go privately, even without prior permission from the region, and charge the cost to the SSN. In every edition of the magazine, we list the commonly used terms in the cooperative health insurance sector, which will help enrich the knowledge of those working in and benefitting from the medical insurance sector. Every issue of the Health Magazine will contain terminologies commonly used in the cooperative health insurance field for further familiarization to both insurance operators and beneficiaries. Service Provider Networks Health service providers as approved by the Cooperative Health Insurance Council and specified by the insurance company to provide service to the employer/ policyholder and to charge the insurance company directly upon presentation of a valid insurance card by the insured. Such networks shall include the following grades: First Grade: Primary health care. Second Grade: General hospitals. Third Grade: Specialized or referred hospitals. Validity The number of days during which the policy shall remain in force in case of non-payment of the total subscription as shown in the policy schedule. Insurance Term The period indicated in the policy table during which the insurance remains in force. Policyholder The legal or abstract entity in whose name the policy was issued. Basis for Remuneration The method used for compensating the policyholder for reimbursable expenses incurred and claimed by the insured after discount. Agent An employee offering and selling insurance policies as: An independent agent representing at least two insurance companies who serves customers by searching for the best coverage available against the lowest prices and collects a certain percentage including customer service charges from each insurance policy. Direct agent or appointed employee representing only one company who sells policies only of that one company and receives the same commission as that of the independent agent. Enjoyment period In health insurance, the enjoyment period is the number of days during which benefits are paid to the policyholder or a dependent. For example, the enjoyment period is computed as of the January the 1st and ends on December the 31st of each year. Case management The system of coordinating medical services to treat the patient, develop the services and reduce the cost. The Case Manager coordinates the provision of health services to the patients. Collective Insurance Policy Property insurance policies require that the policyholder must procure insurance equal to a certain percentage of the property value to be eligible to collect the total value of the policy in case of property loss. In health insurance policies this is applied in terms of a percentage of each claim exceeding the value the policyholder paid by 20% in a collective insurance policy. The policyholder pays the agreed amount in addition to 20% of the total covered losses. After payment of 80% of the losses limit, the insurance company has fulfilled its obligations. Coinciding Periods When a patient is admitted to a hospital for a variety of diseases or cases at the same time, all benefits must be provided as if the patient suffers one case only. Coverage Protection is provided by an insurance policy in property insurance, including coverage against insured risks, insured property, insured premises, and policy beneficiaries in addition to the coverage value. Insuring Area Any losses or damages to property that may lead to a financial loss. Insurance Policy Arranger An insurance company representative who tries to assess the losses of an insurance company when a claim is raised. Insurance companies appoint independent policy arrangers on a need basis. An arranger may operate for more than one company at one time and charge such companies on the basis of hourly rate in addition to the mileage he or she covers. A general arranger works in favor of the customer in collecting claims and collects his or her charges in terms of a percentage of each claim. Expense Limit A pre-set amount a person is required to pay before the insurance company pays 100% of that person s medical expenses. Reasonable and Recognized Medical Expenses Medical expenses that coincide with the charges of the majority of the approved physicians or hospitals in the Kingdom provided that such charges are for the treatment of identical cases and that the approved physicians or hospitals are of equivalent qualification and classification to those who have offered the treatment. Medical treatment that is no different to that considered as acceptable by the approved physician. * Source: Insurance Council / health insurance policy 50 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 51

27 Travel & Tourism Singapore was considered as a third world country but it is now ranked among countries with the highest level of income per capita the annual per capita income of Singapore is USD21,000. Singapore An emerging favorite among Saudi visitors Singapore is a cosmopolitan country, and its essence lies in its multi-racial society. Arabs have played a dominant role in South East Asian trade since the foundation of Singapore in Singapore is one of the most popular tourist areas in the world, although in the past it was just an island small in size and importance in economic and touristic terms. Singapore and the Kingdom: Close Ties The recent visit of Prince Sultan Bin Salman, Chairman of the Saudi Commission for Tourism and Antiquities (SCTA), to Singapore catapulted this country into the spotlight as one of the most popular destinations for Saudi tourists. According to Singapore Tourism Board (STB), Saudi Arabia has emerged as a top tourism market for Singapore, following 7 percent increase in visitor arrivals to the city-state in 2009 when compared with Singapore s recent tourism transformation, which includes the opening of two new multi-billion dollar Integrated Resorts that offer families world-class experiences from the thrills of South East Asia s first Universal Studios theme park to luxury shopping malls, hotels and celebrity-chef dining experiences of Marina Bay Sands; will definitely fuel an increase in Saudi visitors in To strengthen the Saudi travel market, STB and some of Singapore s leading travel and tourism companies met with key members of the Saudi travel industry recently to update them on the city-state s latest family-orientated attractions, unique nature and wildlife tours, and its luxurious hotels and beach resorts. Singapore is undergoing a spectacular tourism transformation, cementing its position as a must-visit destination for families, highly mobile individuals, honeymooners and business visitors, said Jason Ong, Area Director for the Middle East and Africa, STB. Singapore offers Saudi visitors a wide-range of travel experiences, from high-end indulgences, enchanting beach holidays and luxury shopping, combined with amenities that meet the Saudi travelers religious needs, to make Singapore an ideal home away from home. Singapore: The Lion City Singapore is located in Southeast Asia, at the southern tip of the Malay Peninsula only separated by Straits of Johor. It has a unique geographical location at 52 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 53

28 Travel & Tourism the head of the Malay Peninsula as it oversees the Strait of Malacca, between Malaya and Sumatra. The state is now considered one of the most important commercial ports because of its location on the shipping routes between the Mediterranean, Western Europe and the Far East. Stretching across an area of 620 sq.km, the island of Singapore and some small islands are located in the surrounding sea straits, and because it s a small country with a population of 4.5 million, it is a highly packed country. The island of Singapore has been known by many different names over the centuries. By the fifteenth century, the island was known as Singapura, the Lion City, from the Chinese words singa (lion) and pura (city). Legend states that a Sumatran prince, Malay Annals, gave it that name when he came to the island in 1299 and saw a strange creature that he thought was a lion. In 1986, the Singapore Lion Symbol was first introduced in colors of solid red against a white background. Singapore s multi-ethnic society, where interaction among different races is common, stems from the inherent cultural diversity of the island. The immigrants of the past have given the place a mixture of Malay (15%), Chinese (75%), Indian (7%) and European influences. The four official languages of Singapore are Mandarin, Malay, Tamil and English. English is the most commonly used language and is the language, which unites the different ethnic groups. Singapore fell under British colonialism in 1819 and then turned into an important base for the British fleet Singapore is a cosmopolitan society with an inherent cultural diversity. The immigrants of the past have given the place a mixture of Malay (15%), Chinese (75%), Indian (7%) and European influences. during World War II. It then gained independence and merged with Malaysia in 1963 before it seceded from the Federation of Malaysia in 1965 to be known as the Republic of Singapore. Thirty years ago, Singapore was considered as a third world country but it is now ranked among countries with the highest level of income per capita the annual per capita income of Singapore being USD21,000. Touristic Attractions Sentosa Resort is the only resort in Singapore with a beachfront location on Sentosa Island overlooking the South China Sea. Nested within 3.5 hectares of secluded tropical gardens on the hillside of Sentosa s popular beach, the resort is just a 15-minute drive from the Central Business District on mainland Singapore. It offers a full range of sporting activities, including paddle skiing. Haw Par Villa is a prominent architectural landmark in Singapore. It is a Chinese mythological theme park and was constructed in 1937, by local tycoon Aw Boon Haw, and dedicated to his younger brother, Aw Boon Par. Described by many visitors as fascinating, delightful, bizarre and entertaining, the villa contains about 25 statues depicting scenes from Chinese mythology and legend. Jurong Bird Park If bird watching is your favorite activity, then Jurong Bird Park is the place to be. It is the largest bird park in the world, offering a hillside haven for 9,000 birds. Considered one of the most magnificent Asian bird parks in the Pacific region, visitors can watch magnificent birds in action. The Penguin Parade enclosure, set in a recreated Antarctic setting, houses more than 200 penguins of five species. The Southeast Asian Birds Aviary recreates the natural equatorial habitat of birds from this region, including simulated tropical thunderstorms. The African Waterfall Aviary is home to more than 1,500 free-flying African birds. The Riverine is a simulated natural freshwater river habitat featuring over 20 species of ducks, fishes and turtles. The park also offers visitors a rare opportunity to get up, close and personal with some of its prized birds such as flamingos, macaws, hornbills, cockatoos hawks, and plenty of other bird species that you may haven t seen and probably even heard about. Eastern & Oriental Express Visitors can explore Thailand, Malaysia and Singapore on an unforgettable rail journey in the plush comfort of the Eastern & Oriental Express, a deluxe train of unequalled luxury and comfort whose shining green carriages carry 132 passengers between Bangkok and Singapore. The journey connects some of the world s most remarkable cities and encompasses all the mystery, excitement and sheer staggering beauty of the East. The train is elegantly decorated, and wherever you venture you will encounter the same extraordinary standards of comfort, decor and service. There are Restaurant Cars onboard offering a variety of Eastern and European dishes. Service is on a par with the world s finest gourmet restaurants. This luxurious train simply recreates the golden age of rail travel: rattan chairs, freshly pressed linen, afternoon tea and cocktails. Night Safari As the world s first dedicated night zoo, the Night Safari is a must-see attraction for all tourists. The twilight holds many surprises as you can look a rhinoceros in the eye or hear the howls of a pack of striped hyenas. There are over 900 animals of over 135 exotic species to watch out for. The animals are in eight zones that recreate various geographical regions, such as, the Southeast Asian rainforest, African savannah, Nepalese river valley, South American pampas and Burmese jungle. Singapore Zoo The Singapore Zoo is acclaimed as one of the world s most spectacular zoos. The use of natural barriers like streams, rock walls and vegetation to separate animals from visitors enhances the open zoo concept. Sprawling over 28 hectares, it is home to over 3,200 mammals, birds and reptiles, including rare and endangered species. Visitors can also enjoy breakfast with some of the animals from the zoo such as the Oriental small-clawed otter, the reticulated python and the highly endangered orangutan in close proximity. Other endangered species like the Malayan tiger, the white rhino, proboscis monkey, Komodo dragon and the sea lion have also found a haven in the zoo. The Fragile Forest is an exciting and educational display of ecosystems and rainforest culture. The Great Rift Valley of Ethiopia exhibition is home to the rock hyrax, the banded mongoose, the black backed jackal and 50 hamadryas baboons. Underwater World Underwater World Singapore is a unique and well-known Oceanarium displaying thousands of marine species from around different regions. Underwater World has an 83-meter long revelatory that moves visitors along a submerged glasswindowed tunnel. From the tunnel, visitors can admire an array of marine life including coral reef, stingrays, moray eels, turtles, sharks, and other fishes. Visitors can also enter the waist-deep pool and interact closely with the dolphins. Snow City Snow in tropical Singapore? Yes, you are not dreaming. At the Snow City, Singapore s first indoor snow center, visitors can experience real snow, a sub-zero climate and a three-storey high snow slope. They can also take snow-tube rides on an inflatable tube, participate in friendly snowball fights or build their own snowman. Fort Siloso Fort Siloso is the Singapore s only preserved coastal fort. The British built the fort in 1880 to protect the western entrance of Singapore Port. The castle, located on the western edge of Singapore, was a detainee center of war prisoners during the Japanese occupation ( ). When the British forces left in 1967, the island was returned to the Singaporean government. In 1975 and under the auspices of Sentosa Development Corporation, the fort was restored and reopened to visitors for the first time. The fort considers an important window to the history of Singapore and a reminder of the horrible war years. Special Hotels The Hotel Hilton International, after Mandarin, is one of Singapore s prominent landmarks. Visitors can relax by the rooftop pool, enjoy views of the bustling city center, and savor international and local delicacies. The hotel offers a beautiful mix between the east and the west. The Pacific Hotel is located in the heart of Marina Bay, the largest shopping mall in Singapore with more than 250 shops and restaurants. The luxurious hotel has eight restaurants, in addition to a Chinese restaurant on the roof terrace, and a Japanese restaurant located near the swimming pool, which is equipped with underwater sound system. Why Singapore Apart from its many attractions, Singapore has become an economic miracle as it is witnessing fast economic, social and cultural developments, quite different from the rest of its South East Asian neighbours. Singapore has continued to grow and prosper since its declaration of independence and separation from Malaysia in Construction and reconstruction works never stops in this city, with a new building or a new facility being built everyday. With its modern shopping malls, luxurious hotels, lavish restaurants and entertainment centers, Singapore aims to become a modern-style city just like London, Paris and New York. Visitors may agree that Singapore is already competing with all major cities with its modern, sophisticated and prosperous infrastructure. 54 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 55

29 Two Opinions Compulsory insurance: Employers speak In the last couple of years, problems related to failure of medical services and the inability to provide treatment to patients, especially those suffering from chronic diseases, reached a critical point, calling for an immediate solution. The proposed solution was the introduction of a mandatory medical insurance, called the cooperative health insurance for the citizens and residents of Saudi Arabia. As everything else, the new system went through ups and downs until it proved its efficiency and a compulsory insurance system was imposed on all employees working in private companies. Given that employers are responsible for providing insurance to their employees, it only makes sense to ask the employers on how satisfied they are with the current insurance services. Are the services appropriate and inclusive? Do they meet all their employees needs? What problems and obstacles do employers face today? Yahya Baroudi, executive director in Modern Company for advertising (Saudi Signs) argues that although the implementation of compulsory insurance has been outstanding, offering many useful services to both employers and employees, some issues still need to be solved. The main issue associated with insurance services has to do with clear and easy approvals. In many cases, expensive services need more time to get approvals; patients in such cases have to wait for hours in hospitals before getting the needed treatment, said Baroudi. The other issue is related to the way insurance companies end their contracts with some hospitals without informing the client. Many patients waste their time going to hospitals that are no longer included in their list of medical centers; this is not right. Seconding Baroudi is Walid Al-Owaimer, deputy general manager of Modern Factory for Wooden & Metal furniture. He said that obtaining approvals is indeed a problem, as 50 to 60 percent of patients have to wait for hours before they receive any medical attention. The way insurance companies deal with private companies on the ground is different from what employers think when they read insurance polices and approve the list of services. In order to raise our satisfaction from medium to high, we (employers) need to have a full clarity of the services covered by insurance companies, he said. Riad Mutran, owner of Lewaa Alttamauz for Advertising, shares his experience with insurance companies. Compulsory insurance had a negative impact on my employees, most of whom took the cash in lieu of insurance. The ones who ultimately benefit from compulsory insurance are insurance companies themselves and not the employees, said Mutran. Before and after Asked about the benefits of implementing compulsory insurance, Baroudi said the system helped to change the contentious Mutran: Insurance companies should provide employers with complete medical services without further complexities and delays because we pay to obtain these services. relationship between employees and employers. Before the implementation of compulsory insurance, employers had to listen to endless complaints of their employees regarding their hospital visits and payment of medical bills. Now, compulsory insurance offers some peace of mind to both the employer and the employee. Commenting on insurance coverage, Baroudi notes that insurance polices are compatible with the needs of the employers and the workers because they cover different categories in an appropriate manner. Highlighting the major financial benefits derived from insurance, Al-Owaimer said: Contracting with insurance companies has reduced the expenses imposed on companies in the past for the treatment of their staff. He added: It also reduced the employees period of absence from work. In short, private companies now throw off the burden on insurance companies. Al-Owaimer believes that there is a conflict of interest between service applicants and providers, which is causing many administrative problems with regard to the coverage of insurance policies. Policies Baroudi: Obtaining approvals is a major issue. In general, compulsory insurance offers peace of mind for both the employer and the employee. of (B) and (C) categories do not cover prevalent diseases and conditions, but (A) covers them all. The issue differs relatively between one insurance company and another. Insurance and productivity Appropriate returns increase productivity, answers Al-Owaimer when asked about the effects of compulsory insurance on productivity. When a candidate applies for a job in a company and reads in his contract a whole paragraph about comprehensive health insurance provided by the company, he will not think twice about accepting the offer. Life is after all a continuous process of give and take, and when we give more, we receive more, he said. Meanwhile, Baroudi thinks of compulsory insurance as a win-win situation for all. All parties involved in the insurance transaction insurance companies, employers and employees benefit from compulsory insurance. Problems and solutions What are the obstacles faced by employers today? According to Mutran, Insurance companies should provide employers with complete medical services without further complexities and delays because we pay to obtain these services. Al-Owaimer believes that it is the right of the insurance companies as profit institutions to reduce as much costs as possible. I advise them [healthcare providers] to reduce their prices, he said. Strongly agreeing with Al-Owaimer, Baroudi called upon the Cooperative Health Insurance Council to set the limits and responsibilities of the insurance companies and their relationships with private companies. I suggest initiating a toll-free number for customer complaints, which in many cases are related to ill-treatment or delays in receiving treatments or approvals. This could be used as a reference to solve problems and overcome pitfalls, he said. 56 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 57

30 Insurance Forum Insurance Forum Dear Reader, This is your space. We are glad to dedicate this section Insurance Forum only for you. Here, we welcome all opinions, suggestions, concerns and questions about the magazine and the topics we cover in each issue. After receiving your comments, we direct them to our panel of officials and specialists in the insurance sector, who answer your queries in the most appropriate manner. Read on as our experts answer this month s suggestions and questions from our readers: Q. First, I would like to thank you all for bringing out this specialized publication, which highlights various issues and topics related to insurance. I would request you to add me to your distribution list. Many thanks AD Adel Mohammed Mulla Riyadh A. We at Cooperative Health Insurance magazine constantly try to provide our readers with useful information and we hope you will soon receive all subsequent issues of the magazine. Thank you for your support and interest. Q. Can you please write about healthy diets for patients who suffer from high blood pressure and diabetes? I would also love to see articles on the medical benefits of fruits and vegetables. Thank you Hussein Ahmed Al-Hamad Hofuf Al Ahsa A. Thank you for your message and suggestions. We will study it and see what can be done. However, this is not a health magazine, and our main focus is on cooperative health insurance. We welcome your ideas and we will surely discuss it with our editor. Q. What is the purpose of cooperative insurance? Said Al-Shahri Jeddah A. The objective of cooperative insurance is to assist the insured in dealing with future and unforeseen risks and to try to return him to the financial situation that was before the occurrence of the damage. Q. What is meant by health insurance? Ahmed Dosari Al-Majma`ah A. Medical (health) insurance covers costs of medicines, medical devices and supplies, treatment and management of medical claims. A. Health insurance helps in saving the costs by providing medical services that are included in the insurance coverage within the limits set out in the insurance policy. Q. What are the direct restrictions placed by the employers with regard to medical insurance? Majid Asiri Jeddah A. The direct restrictions are related to non-payment facilities provided to the insured with the service providers appointed by the company as all expenses are directed to the company. Q. What is meant by insurable interest? Abdulrahman Al-Qahtani Riyadh A. It is the legal right of an individual to insure something (a car, for example). In other words, in order to insure something there should be a legal relationship that can be ascertained between the person and the subject. For example, if you own a house or a car you are entitled to insure it, but you cannot insure the house of your neighbor because of the lack of insurable interest. Q. Please enlighten me on the deductions percentage in case of copayment Dirar Salim Mohammed Tabuk A. Deduction is the money that should be paid (as specified in the policy) by the beneficiary (the insured) in case of an accident. For example, if there is a car accident and the cost of repairing the car is SR5,000 but the amount specified in the policy is SR1,000, the insurance company will pay SR4,000 and the insured will pay SR1,000. Q. What is the extent of insurance coverage? Abdullatif Husseini Buraydah A. It is the maximum liability of the insurance company, as specified in the policy, before deductions. For example, the maximum liability of the insurance company - according to the vehicle insurance policy - is SR5 million for material damage, and SR5 million for physical damage. So when the amount is higher than SR5 million, the insured has to pay the difference and not the insurance company. Q. What is compulsory vehicle insurance? Said Al-Dosari Al Kharj A. Compulsory vehicle insurance policy covers damage caused by your vehicle to others (people and property). This policy does not cover damages incurred while you are driving the vehicle. For example, if you hit someone s car, the insurance company will cover 100 percent of damage caused to others but it will not pay for the damages occurred to you or your vehicle. Q. I would like to know more about comprehensive vehicles insurance. Osama Noureddine Yasssin Hafar Al-Batin A. There are two types of vehicles insurance; one covers the damages or injury of the driver and others inside the vehicle and damages of the vehicle itself (including fire, theft and accidents); while the second type covers damages incurred on third parties (persons and property). For example, if two vehicles hit each other, the comprehensive insurance company will pay for all damages caused by or occurred to you in addition to paying all the costs of repairing your car, and compensate the third party for any damage caused by you. The policy could be expanded for additional premium to include the following: rental of alternative vehicle during the period of repairing affected vehicle, roadside assistance and vehicle repair at an agency or a workshop. Q. How can people benefit from health insurance? Hassan Al-Hajri Dammam To send us your questions/ suggestions, please fill up the form below and send it to us via fax, or postal address, and we will get back to you soon. 58 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 59

31 Pause Believe it or not Wacky celebrity insurance policies Singer Tom Jones has had his chest hair insured for USD7 million. King of Pop Michael Jackson owned an insurance policy against the possibility of losing his voice forever; he also insured his skin before each whitening surgery. Superstar Tom Cruise has had his smile, credited with 80 percent of his success, insured for USD55 million. America Ferrera, star of US TV show Ugly Betty, has had her smile insured for USD10 million. The famous Italian Coffee taster Gennaro Pelliccia has had his tongue (or taste buds) insured for USD13.9 million. Almost all football stars who took part in the World Cup 2010 have insured themselves against serious injury or permanent disability. Real Madrid and Portugal star Cristiano Ronaldo pays USD 500,000 annually for his insurance company against sudden death and disability. The English player Wayne Rooney has had his knee insured for eight million pounds, and ankles for five million pounds before he hit the age of forty. The Argentine Messi owns a four million euro insurance policy against minor injuries that could preclude him from completing any sports season; he also has an insurance against permanent disability worth 44 million euros. Most celebrities are obsessed with their bodies and worldly assets and terrified that they will one day lose them. Such insurance policies are not new to Western insurance companies, which benefit from these customized insurance policies. Quote of the Month Choose modesty over curiosity, silence over speech and faith over fear. Secrets of the universe Call for prayer 24 hours a day A mathematics researcher in the UAE has reached a genius equation establis - ing that the call of truth (Azan) goes on round the clock in some part of the world or another, confirming the inim - tability of the Almighty. The researcher Abd Al-Hameed Al-Fadel said in his study: The Islamic call to prayer doesn t stop around the world; once it is finished in an area, it starts in another. He explained his idea saying that the earth is divided into 360 longitudes, which determine the time in each area. Each longitude is separated from the fo - lowing one by exactly four minutes. The call for prayer starts in its exact time and lasts for about four minutes. To make the picture more obvious, let us assume that the call to prayer starts now in the area at longitude 1 and lasts four minutes. When the four minutes are over it will start in the area at lo - gitude 2; when done, it will start at lo - gitude 3, then 4 and so on, the call for prayer never stops all day long. This can be confirmed in a simple equation: 4 360(longitude) = 1440 minutes. 1440/60 (minutes) = 24 hours. When I was young I didn t like going to weddings. My grandmother would tell me, You re next However, she stopped doing that after I started saying the same thing to her at funerals A few gems from poems of famous Arab poet Abu Firas Al-Hamdani: I see you hide your tears and pretend to be strong Does not love have a say or dominion over you" Yes, I am anxious and I miss you badly" But people like me do not reveal their secrets" When lonely nights tear me apart I cry Fire burns my heart when I think of you Death is easier then waiting If I died thirsty, then who cares if it rained or not She asks, who you are, she knows better Can a boy deny how he feels" I said as she and love asked me to say I am your sufferer She said: which one, I know many My people will remember me when they are in hardship In dark night, full moon is always missed If I survived the battles that is not my choice If I died, that is my destiny, men eventually will die If my life was long My memories will keep me proud Those who choose the prettiest Care not about price Did you know? Your stomach has to produce a new layer of mucus every two weeks otherwise it will digest itself. Gold of 24-carat is not 100 percent pure gold; it contains a small percentage of copper because pure gold is too soft for prolonged handling. In 1894, there were only four cars in the United States. The longest recorded flight of a chicken is 13 seconds. The electric chair, which is used in executions, was invented by a dentist. The only two parts in human body that never stop growing are nose and ears. 60 Shawwal 1431 October 2010 COOPERATIVE HEALTH INSURANCE 61

32 Opinion We meet again It has been ten years since the introduction of the cooperative health insurance system. Though it may seem like a short period, in terms of changes and developments, many accomplishments have been made. There is no doubt that what has been achieved in these years has positively affected everybody. We at the Council of Cooperative Health Insurance thank God for what has been made possible of our long-term strategy. But we will not stop here. We will continue to strive and achieve the hopes and aspirations of our leaders. God willing, we expect in the next ten years a number of changes to take place, some of which include: Emergence of new companies because many of the existing insurance companies will merge. Some will eventually leave the market due to their bad management and because of the weakness of the market and thus, the total number of qualified companies will decline. An increase in volume of investments in associated activities such as: re-insurance, claims management, marketing, customer service, education and specialized training. The inclusion of all targeted segments of society under the umbrella of the cooperative health insurance. New segments will be covered under cooperative health insurance including: international Saudi travellers, pilgrims and visitors. The expansion of medical coverage to include all regions of the Kingdom. The sector s contribution to increase the gross national product will increase by five to seven percent. At the Board level, we expect, God willing, a number of significant developments, which include: Establishing a permanent headquarters of the Council Establishing branches of the Council in the Western and Eastern regions Linking all departments and branches electronically Activating the portal to include all transactions from and to the Council Achieving self-sufficiency (expenses to equal revenues) Developing and modifying the organizational structure of the Secretariat Preparing a series of studies and researches about the sector, changes, needs, problems, and solutions Distributing bulletins and periodic reports on the performance of the sector, insurance companies, and quality of services provided Activating the role of the Council with its partners, and translating that into plans and programs designed to serve the sector Mohammed bin Salman Al-Hussain Assistant Secretary General Financial and Admin Affairs Council of Cooperative Health Insurance Undoubtedly, this future vision represents our aspirations and could face many challenges. However, what is important is the actual utilization of health insurance and the development and upgrading of health services to reach all the people living across the length and breadth of the Kingdom. We will continue this journey armed with faith, hope and your support. We need you to understand your rights and duties. A cart without a horse does not move, and it moves slowly with one horse, but with many horses, the efficiency and speed will be amplified and more goals will be achieved. 62 Shawwal 1431 October 2010

33 Our mission REINSURANCE النخبة لوساطة التأمين وإعادة التأمين To provide outstanding and exceptional services perfectly cover the needs of our clients and identify your own insurance needs and wishes To develop the most inclusive and cost-effective solution Our Customer.. Our Partner Kingdom of Saudi Arabia P. O. Box , Riyadh Phone: Customer service: Fax: Ex