The chart above presents the average international private medical insurance (IPMI) inflation rate across the globe from 2009 to 2017. In 2017, the global percentage increase of IPMI premiums was 7.0%.
Interestingly, we discovered that the global IPMI inflation rate in 2017 was 2.2 percentage points lower than the 2016 inflation rate of 9.2%. When compared to the annual premium inflation rates recorded between 2009 to 2016, the global IPMI inflation percentage in 2017 hit a record low. In other words, while overall IPMI premiums increased in 2017, average prices of IPMI products increased at a comparatively lower rate than the previous eight years.
Furthermore, when you compare the 2017 IPMI inflation rate with the global Consumer Price Inflation (CPI) rate, health insurance inflation was 3.9 percentage points higher. As with previous years, it appears that health insurance inflation has remained mostly immune from global price inflation trends in 2017.
Historically speaking, the percentage difference between CPI and annual IPMI inflation usually maintained at about five percentage points, yet in 2017 the gap between the two figures narrowed marginally. While the gap indeed narrowed in 2017, chances are high that the IPMI inflation rate and its difference with CPI will be similar to previous years come 2018 (find out the main reasons why in the Insurer’s section).
It is worth noting here that, as with 2017’s report, we have excluded Dubai’s average premiums when generating this report’s global IPMI inflation rate. An explanation for Dubai’s exclusion is in the Dubai section of the report, however the simplified reason is due to the final roll-out of mandatory health insurance in 2017. This has meant that insurers have had to implement new locally compliant plans that meet the region’s health insurance regulations. As such, there is not enough historical data available to provide an accurate measurement of Dubai’s 2017 premium inflation.
IPMI premium inflation over time
When looking at the Average IPMI and Consumer Price Inflation: 2009 - 2017 chart above, it is clear to see that premium inflation figures have fluctuated quite a bit over the past 8 years. Taking this variability into account, we generated the Compound Annual Growth Rate* (CAGR) figure of 7.80% based on average premium inflation between 2009 to 2017%.
When comparing the CAGR with the 2017 global inflation rate of 7.0%, we see that, while this year’s inflation rate has hit a record low (between 2009 to 2017), premiums are still increasing at a similar rate over time.
|IPMI Premium CAGR: 2009 - 2017|
*Compound Annual Growth Rate, or CAGR for short, refers to the average annual growth rate over a specific period of time, in this case: one year.