The Capital Market Authority (CMA) has issued regulations for operation of Third Party Administrators (TPAs) in the sultanate.
The rules will enhance the regulation of the health insurance sector in Oman, where TPAs will play an important role by providing outsourced post-sales administrative services to insurance companies by facilitating cost effective claims operations with high efficiency and quality, while ensuring a seamless and pleasant consumer experience to the insured policyholders.
Abdullah Bin Salem al Salmi, executive president, CMA, stated that the issuance of the regulatory requirements for carrying out TPA business as per a decision (34/2020) will add to the readiness of the infrastructure of the insurance industry in the Omani market, improve quality of services related to health insurance, and complete the legislative and regulatory framework of the health insurance scheme for the employees of the private sector, expatriates residing in Oman, and visitors.
He added that the issuance of the regulation is in response to the growth in the health insurance market in the sultanate. In 2019, health insurance topped amongst the insurance products, recording 35% of the total insurance market, amounting to RO170mn.
“The sector witnessed considerable growth in the past five years by more than 25% year-on-year growth and we expect that health insurance products will see more turnout, thanks to the increased public awareness of the role of insurance in providing healthcare for employees in the private sector, further to the government’s policy of furnishing insurance coverage for this category,” he said.
The regulations allow the licensee to render services for more than one insurance company and outlines the framework for contracting health service providers. The requirements took into consideration the ease of investment by nationals, promoting Omanisation and investment in human resources by opening opportunities for fresh graduates from local colleges and universities. “Furthermore, it will promote workforce development through structured training and development to cater to the demands of the industry with the required mix of medical insurance and finance knowledge,” Salmi added.
CMA’s Dhamani portal will be the centralised health insurance exchange platform that will integrate and link the regulator(s), insurers, TPAs, private health institutions, insured members and all other relevant stakeholders to seamlessly interact and conduct all transactions electronically, thereby improving efficiency and reducing administrative overhead costs.
The minimum capital requirement will be RO200,000 for the TPAs and their work will solely be focused on third party administrative services with minimum overlap with the functions of brokers and agents. The TPAs are required to have a full time manager with a university degree in medicine, health care or insurance, with no less than five years of experience after completion of the degree, in addition to having a full time doctor with no less than five years of experience.