Rising healthcare costs see firms focussing on flexibility
Employers in Asia need support to manage the rapidly escalating costs of healthcare, head of JLT Asia Duncan Howorth (pictured) has told StrategicRISK.
Furthermore, he said, an increased emphasis on talent recruitment and retention in the region has focussed greater attention on employee benefits at the region’s major corporates.
“We see the emergence of more flexible benefit arrangements, with the ability for employees to buy benefits that suit their circumstances and lifestyle,” Howorth said.
“We also see government activity across the Asia region to create frameworks in which group retirement plans can be developed to support the ageing populations.”
Howorth was speaking to SR following the release of JLT Group’s preliminary results for 2013. They reveal that JLT Asia’s employee benefits business enjoyed 45% growth to more than $90 million, 38% of which was organic. This growth was buoyed by the company’s strong position in the high net worth life assurance market and the ongoing demand for healthcare insurance and risk management.
For the risk and insurance business, JLT Asia’s operations experienced revenue growth of 13.1% to more than $110 million, of which 9% was organic. JLT Asia’s 2013 revenue and trading profits represented 12.5% and 15.6% of group revenues and profits, respectively.
Some of this growth is a result of mergers and acquisitions in Indonesia, Taiwan and Hong Kong. “JLT expects to continue to invest in Asian economies in the coming years as it expands in the region,” Howorth said. It is also due to investment in specialty areas such as energy, construction, and infrastructure.
Howorth said that construction and energy projects were abundant in Thailand, Indonesia, China and Philippines. “Supporting these projects also requires relationships with contractors which are often located elsewhere to the project location,” he said.
There were also many opportunities in Chinese investments abroad, Howorth added, while Thailand offered food and agriculture, employee benefits and broader insurance opportunities. “[Although] both countries pose risks in terms of their political and economic environments,” he cautioned.
One of the key attractions of the Asia-Pacific region is its huge population and growing middle class, Howorth added. “The insurance industry sees this opportunity,” he said.
“We see our role in providing bespoke solutions for small and medium enterprises, as well as supporting clients in providing insurance solutions to their customers, employees and members.”