Axa PPP International Expands Asian Business to Tap Rising Health Insurance Demand

Axa PPP International is enhancing its health care operation in Asia by teaming up with Axa Asia General Insurance for distribution in the region to meet growing demand for medical insurance.

Axa PPP Healthcare Ltd., a unit of Axa SA, said in a statement the partnership with its affiliate will enhance the medical insurer's "product, service and distribution capability in Singapore, Malaysia, Indonesia, Thailand, Hong Kong and China," as Axa has a presence in both life and nonlife insurance markets.

The U.K.-based private medical insurer said the company will use "the existing distribution capability of both Axa general insurance and Axa life entities" in Asia. Axa PPP already sells international plans to expatriates in the region and it is also "receiving a reinsurer's share" from Axa general insurance entities.

Axa PPP is looking to "maximize opportunities across all channels" including brokers, agents, direct and bancassurance and all segments from individuals to large corporates. "A balanced channel and customer mix is crucial to support both fast growth and profitability," said Laurent Pochat-Cottilloux, managing director of Asia health care at Axa.

"This initiative will entail a significant upgrading of our customer proposition, in terms of service and product features," said Pochat-Cottilloux. Prior to this distribution alliance, there was "no material business relationship" between Axa PPP and Axa Asia Pacific.

In Asia, Axa PPP is "still relatively a small player, so our planned growth rates are significantly higher than total market growth for the next five years," said Pochat-Cottilloux. "Fundamentally, we see a vast unmet demand for health in the region."

Many Asian countries have posted strong premium growth for medical insurance. In Singapore, health insurance increased 10% to S$77 million (US$56.5 million) in premiums for the first half of 2010, according to the Life Insurance Association Singapore.

"The unabated growth indicates that consumers are acting on their awareness of the need for health insurance to pay for the costs of treating serious illnesses and to cope with rising medical costs in general," said the life association in a statement.

In Hong Kong, health and accident insurance posted an 11.7% rise in gross premiums to HK$2.6 billion (US$334 million) for the first quarter of 2010, according to the Office of the Commissioner of Insurance. In Malaysia, gross premiums for medical and accident insurance rose 12.4% to 1.52 billion ringgit (US$485 million) in 2009, according to Bank Negara Malaysia.

In Asia, Axa PPP's initial geographic focus includes Singapore, Malaysia, Indonesia, Thailand and Hong Kong. "The strategy is to be proposition-driven, aiming to be recognized as a leader in service excellence in the region, and demonstrate better value for money than our competitors," said Pochat-Cottilloux.

As part of the new development for health insurance in Asia, Axa PPP has created a Singapore-based team to strengthen the insurer's presence in new and emerging markets in partnership with other Axa entities. Pochat-Cottilloux joined Axa from Standard Life Healthcare. Seven new appointments were made for the health insurance unit in Asia.

Established in 1940, Axa PPP provides health care insurance for individuals and employers, health information, health care commissioning services, occupational health, personal counselling and vocational rehabilitation services in the United Kingdom.

(By Iris Lai, Hong Kong bureau manager: [email protected])