How Covid-19 is changing employee benefits

Shah Rouf, CEO of Group Corporate Solutions at AIA Group, discusses how Covid-19 has changed employee benefits programs.

Captive Review (CR): How has the pandemic impacted employee benefit programs? What are the changes you are seeing?

Shah Rouf (SR): It’s incredible to think that we have been living with the pandemic for 18 months, and when we look back on that period, we can perhaps categorise the impact that COVID has had on Employee Benefits as a number of distinct stages.

The first and our immediate reaction was to run through our policy T&Cs across the region to find any existing or applicable exclusions. We did this to ensure coverage for COVID-19 on Group Life and medical wherever applicable. As COVID escalated, the challenge has been to keep waving exclusions whilst maintaining the sustainability of the programme.

A second stage was to reassure our insured members by providing benefits uplifts whenever applicable, these included things like death benefits and lump sum hospital income. Benefits uplifts of course took into account local market practices on benefits design and interaction with social security systems.

A third stage has been clients’ desire to maximise cost savings through premium maintenance or even premium reductions from the decreasing trend in medical claims, arising from lower utilization. Discussions that have taken place against a backdrop of a general reluctance from HR operatives to change insurance provider.

A fourth stage has been the understandable growth in demand for online medical support. For AIA, partnerships such as those that we have with Whitecoat in Singapore or WeDoctor in China, have made a real difference for our clients.

A crisis such as COVID-19 affects all business sectors and it required us to rapidly assess and where possible automate operational processes with high manual interventions.  This has been a key learning and helped by greater customer adoption, we see an opportunity to continue to invest and create a more agile, digitally-enabled business and ecosystem to support policy and claims management as well as products and services.

CR: What was the immediate reaction from the industry once the scale of Covid-19 was realised?

SR: The insurance industry in Asia facilitated waving exclusions and benefits extensions to provide a very human response at a time of need. Multinational Corporations with captive programmes benefited tremendously from such risk management vehicles as they were able to work closely and quickly with insurers such as AIA to extend COVID-19 related benefits and coverage.

Many of our employee benefit programmes are now incorporating extended coverage to include side effects from vaccination and actual medical costs of contracting the virus. Support from AIA includes additional free cover, coverage for COVID-19 vaccine complications, and extended cover for spouses and children.

AIA China offered onetime payments for death and disability, AIA HK introduced a diagnosis lump sum benefit, quarantine benefit and additional Death Benefit, while AIA Singapore also included hospital income. AIA Malaysia created an additional product to cover admission and treatment at private hospitals with many extra benefits including cash relief for COVID-19 hospitalization.

CR: You mentioned there have been many organisations adding new benefits to their programs to directly address the health issues surrounding Covid-19. What other kind of benefits are you seeing captives add?

SH: Our captive clients have requested support to include preventive benefits such as Vaccinations, Home Based Health Screening or health checks in general and they have been particularly keen to expand cashless teleconsulting offerings to other areas, such as paediatric care and mental health.

Mental health benefits and coverage has been a particular areas of focus given how the pandemic unfolded, and dealing with employee mental health issues has increased in importance. For instance, in Hong Kong and Singapore AIA is launching an end-to-end digital mental health solution, an interactive, app-based workplace well-being programme designed to promote and support mental health.  This will soon be available across our healthcare markets.

Captives insurers are now working closely with the HR community to ensure alignment between benefits and policy guidelines:  good employee benefits programmes must give access to both prevention and protection. Employee benefits, when successfully rolled out, remain extremely relevant to safeguard the overall health of employees and their families. AIA’s approach is to  partner with multinationals and captives that invest in the wellbeing of their workforce and their families, it is part of our commitment and social responsibility.

CR: There has been a lot of talk about how the pandemic will permanently change much of what we did previously, as the world transitions to a “new normal”. What changes do you think will happen in the future in the employee benefits space?

SH: The pandemic has increased awareness of the importance of wellness and preventative care. We are taking an even more holistic focus on our clients’ strategic priorities concerning the physical, mental and financial wellbeing of their workforce.

For AIA, this translates into continued investment into analytics and data-driven solutions to give employees access to quality, affordable care and to the right range of products tailored to their individual needs.

The pandemic has shown that an industry that was previously considered stable will need to evolve and become more agile to react to changing business requirements.

Digital transformation will remain at the core of AIA’s strategic priorities, alongside continuing to build our ecosystem of partners and services, such as teleconsultation, that can be deployed across our unparalleled regional footprint across Asia.

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