CINICO to offer insurance to all in major expansion
(CNS): The government-owned insurance company, CINICO, is being expanded to provide affordable health insurance for more people outside of the public sector, including the elderly and those with pre-existing conditions. Finance Minister Chris Saunders also said CINICO will be refunded to allow it to provide auto and home insurance for government workers. The main aim is to better utilise what was always supposed to be a national insurance company for the benefit of the nation and help both the uninsured and under-insured.
A press release issued Wednesday said that by the end of this year, the Cayman Islands National Insurance Company (CINICO) would begin offering cover to younger and healthier residents working in the private sector, followed by a plan for retirees and a health insurance option for public servants who will on a voluntary basis be able to access a private scheme.
This would allow them the opportunity to choose their healthcare providers, as civil servants are currently limited to using the Health Services Authority. This will require the establishment of a local provider network.
CINICO will also be rolling out new insurance products for public sector workers offering cover for casualty and property.
“During the 14-year period between 2009 and 2023, core government’s healthcare costs are forecast to increase by 120% from almost $91 million in 2009 to just under $200 million in 2023,” Saunders said, as he outlined one of the motivating factors to expand CINICO.
“Healthcare costs represent an average of 19% of core government’s total operating expenses, indicating that it is becoming more difficult for the public purse to sustain the increasing costs,” he said, adding that it was “past time that CINICO truly becomes a national insurance provider”.
“The potential has been there and must now be realised to provide the public with more insurance options — health, property, and auto — that they require,” he said.
“This is especially true regarding health insurance, which is becoming increasingly expensive, with more and more of our retirees being excluded due to pre-existing conditions, or simply aging out at 65 from private insurance plans. This puts an unbearable burden on our retirees, which then falls on the government to carry.”
Saunders said that expanding CINICO will both reduce these costs and provide healthcare to more people and allow seniors to age with health and dignity. He said he hoped that CINICO “would eventually become the insurance provider of choice for all residents of the Cayman Islands”.
The minister explained that the expansion, especially of health insurance, to a wider population will achieve several government objectives and meet the strategic policy aims of the PACT administration “of ensuring an equitable, sustainable and successful healthcare system as well as providing solutions”, he said.
“On the ground level, we are delivering on our promise to provide the public with an option that is affordable and includes a mechanism for accommodating coverage of pre-existing conditions for qualifying Caymanian retirees,” Saunders said adding that this will diversify CINICO’s risk profile and by extension the risk to government.
He said funding for the expansion had been approved by Cabinet and would be voted on at the next finance committee.
“CINICO currently has sufficient surplus capital to fund the planned health insurance expansions,” he said. “However, CINICO will need additional capital for the planned property and casualty expansions. On Tuesday, 5 April, Cabinet approved CINICO’s expansion plans and the requisite supplementary funding of $10.35 million… The approval of these funds will go to the next session of Finance Committee, which is planned for May.”
The money will be split over this year and next — $5.35 million in 2022 and $5 million in 2023.
Deputy Premier Saunders noted that the expansion of the national insurance company’s products would also protect residents against being left without coverage should there be any further closures in the private insurance sector.
“In December 2021, Generali Worldwide, one of the largest health insurance providers in the Cayman Islands, withdrew its business from the Cayman market,” Saunders said. “The withdrawal was a shock to the market as many individuals and businesses had to find new health insurance providers and individuals, especially those with pre-existing conditions, found it difficult to obtain affordable health insurance.”
He added, “To mitigate similar shocks to the Cayman market in the future, it is important that the government is in the position to be able to provide individuals and businesses with the option of affordable health, auto and property insurance.”
CINICO CEO Michael Gayle said the team was looking forward to the expansion.
“Healthcare costs continue to spiral, but we are confident that working with our sister organisation, Cayman Islands Health Services Authority, and with external medical providers with whom we will enter into a Preferred Provider Network arrangement, collectively, we will be able to play a part in bringing some stability to health care costs here in Cayman,” he said.
“Exciting times are ahead at CINICO,” Gayle added.
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Category: Health, Health Insurance
Thanks for this information i didn’t even know that CIDB offers mortgages, like you said more advertising should be done.
With our government now proposing to offer affordable Home, Auto and Life Insurance to ease the financial burdens on families who own homes and want to purchase affordable homes.
Maybe some attention should be given to consider properly advertising the low mortgage interest rates at the Cayman Development Bank
Intrest rates at the Development Bank is half of what the retail banks are charging.
The Development Bank Mortgage Interest Rate is 5% and the Retail Banks Mortgage Interest Rates are 11%
In other words, a mortgage for $125,000 monthly repayments is approximaletly $700 and a mortgage for the same amount of $125,000 monthly repayments is approximately $1,400
With a recession looming not too far in the distant future, consumers with existing mortgages might want to seek re-financing there home mortgages to avoid the wave of expected mortgage foreclosures
Who are you borrowing money from? The mafia?
Commercial banks are offering anywhere from Prime+0.5 to Prime+2 for home mortgages. As Prime is currently 3.5 that puts mortgages at 4% – 5.5%.
No where near 11%
You might want to speak to your bank load officer.
With our government now proposing to offer affordable Home, Auto and Life Insurance to ease the financial burdens on families who own homes and want to purchase affordable homes, maybe more some attention should be given to consider properly advertising the low mortgage interest rates at the Cayman Development Bank
Intrest rates at the Development Bank is half of what the retail banks are charging.
The Development Bank Mortgage Interest Rate is 5% and the Retail Banks Mortgage Interest Rates are 11%
In other words, a mortgage for $125,000 monthly repayments is approximaletly $700 and a mortgage for the same amount of $125,000 monthly repayments is approximately $1,400
https://www.cidb.ky/
All sounds great until you apply some common sense. If CINICO is going to insure the indigent and elderly in greater numbers then they are taking on the highest risk group there is, they will undoubtedly be paying out increased numbers of claims and a lot of those will be expensive claims. This will then require that they either:
1. Increase premiums to cover the claims
or
2. Ask Government to cover the increased costs (This is your tax dollar)
Either way this plan increases the cost for CINICO to operate, it is just a question of who pays for that cost, you the customer or the Government (which translates to you).
Another question. Will these persons be given the standard health insurance cover SHIC? Because that is a rip off in and of itself.
Funding will have to come from somewhere. Maybe a tax?
What about those elderly who don’t qualify for Brit-Cay or Cayman First? They are considered to high of a risk to insure. So they are currently stuck with the CINICO “Silver” plan, which means that they pay $250 per month and only get $400 per year of regular coverage. The Silver plan pays well for catastrophic care.
We have uninsured Seamen and other retired folk that pretty much have to pay out of pocket for everything. This could be a good thing for us all, IF it is properly administered.
Civil Service and other government entities have good health care for a decent price. We could all hope for that same level of care.
So their first priority is expansion of business to the healthy and then maybe some unspecified time down the road to the people that need it. Yeah thanks government.
Health insurance, the greatest scam since religion.
Yea that’s true
Agree
So he said until his family was hit with the cost of a triple by pass surgery. Trust me health insurance is no scam.
Health insurance is there for large unexpected costs, not for everyday runs to the doctor. Trust me, you’ll be happy you have health insurance if, God forbid, you have to do major surgery or an organ transplant.
I agree. I’ve said before that health insurance is like betting against yourself and hoping you lose. Still, it is clearly a necessary evil within our system. If we have to have it, it should be the greatest benefit for the most amount of people.
Three fools that think alike. Way to go idiots.
Licensed robbers.
Licensed robbers encouraged by elected gold digging wannabees.
Health insurance:
One governmental provider and everybody pays a premium based on income. Everybody receives the same coverage .
No more share holders and no more deaths if you can’t afford a simple MRI.
A very healthy person does not need health insurance?
Untill he gets sick or involved in an accident.
What an ignorant comment
You also don’t understand the principle of insurance.
To Anonymous 6:18pm: That is a very simple minded statement. A very healthy person who takes a fall and shatters the pelvis and has to spend three weeks in hospital does not need insurance? Please, educate yourself.
You know in order to stay healthy you also need to visit Docs on the regular right? and you won’t be immune to accidents that could cause severe damage that needs medical attention to correct. SMH…
Can’t fix stupid either, but you still here 6:18
CINCIO was not established to be a national insurance company. It was first created to ‘manage the book’ of Civil Service (and retiree) health insurance to allow Government to gather enough data to then place that with the private sector, after the first private insurance company that had won the contract found they had under-estimated the actual costs of that coverage and so were under-charging the government for the coverage they were contracted to provide. (That deal quickly ended as you can imagine, leaving Government again holding the bag and leading to CINICO.)
However no sooner than having been created did CINICO think they were a real insurance company. Probably because the Government promptly began to use them to provide the (medically) indigent and other insurance coverage which, again, the private sector have no interest in providing to Government. (Ask anyone who has been dropped at retirement, or tried to switch insurers with a pre-existing condition.)
Government then truly saw the benefit of their own insurance company. The ‘indigent surcharge’ each health insurance coveree pays is too low to actually pay for the indigent coverage. But by annually raising the rates that CINICO charges Government for civil service health coverage, and other verbal and economic trickery, the government has been able to reduce their up-front costs for providing health insurance for the medically indigent, etc. (Note: medically indigent is different from indigent. When you can’t get insurance for a pre-existing condition and CINICO picks up that tab its because you are deemed ‘medically indigent’. Because lets be honest none of us can pay all our own medical bills without insurance.)
Don’t believe that CINICO overcharges Government for Civil Service coverage? Ask yourself (or the Minister of Finance) how CINICO was able to accrue enough ‘surplus capital’ that “CINICO currently has sufficient surplus capital to fund the planned health insurance expansions,” (according to the article, quoting the Deputy Premier). Because every year they raise the Civil Service per-person charge (in increasingly opaquely complex ways) and then use the ‘profits’ from that bulk of their business to offset the ‘losses’ on the rest of their clients.
This is not to say that a national insurance company may not have social benefits. (Its why we need ‘medically indigent’ cover from CINICO now.) Just that it must be run openly and honestly without hiding behind alternate histories, and being clear on what the real costs (and profits) of each subset of its coverage is. Otherwise people will not trust it. And insurance will only work if enough ‘young and healthy’ people use it to outweigh the ones of us who get sick that year. (Which is why the working civil servant ‘profits’ counterbalance the ‘losses’ on the retired civil servant health care costs; that’s just demographics.)
Ummm… so you are dying that CINICO (Cayman Islands National Insurance Company) was not intended to be a National Insurance Company? Is that not what it says on the box?
It may say it on the box. Its not what the genesis was. As I said CIG quickly realised they had other uses for CINICO than originally intended. Just because the box says Superglue now that’s not what the original idea was.
Chemist Harry Wesley Coover Jr. was trying to make a protective coating for the lenses of gun-sights for jet-aircraft. “Instead, when he applied the new acrylate, it stuck the lenses together and they could not be separated. Although they were ruined, Coover saw the potential for this substance. It took 7 years to market the first version of Superglue.”
Shakespeare said let’s kill all the lawyers. But at least I can call, email or message my lawyer 24/7. But doctors are such a precious lot. You have to wait months for an appointment and then sit for hours in the waiting room. Doesn’t matter if it’s public or private. Cayman or elsewhere. The service is terrible. Add insurance to the mix and the entire industry is a rolling disaster.
Will this cover more than one or two doctor visits a year? Or will it continue to just be for hospitalizations? And what about overseas care? What if we want to see a doctor in the US?
America have a Federal Home Loan program that is designed to give Americans affordable home ownership options that includes home, life and auto insurance.
The FedHome Loan Centers is dedicated to empowering Americans with sustainable home ownership solutions, why can’t we have similar programs here?
https://www.fedhomeloan.org/
Private sector insureds will not want to switch to Cinico due to their poor performance and past issues.
It’s fun spending other peoples money. What next?
an expansion of the same failing scheme/model is not the answer.
time to look at new ways to provid affordable relaible healthcare. US model is a recipe for disater…unless you are a medical professional who gets to scam the system every day.
Cinico and HSA are already in a financial mess. What is this going to solve and how will it be funded?
Hopefully, it will provide a broader base for insurance, which — in a proper system — reduces rates for the customer. Nationalisation of CINICO, in other words. I’ve been hoping for this for nearly a decade.
I hope CINICO, CIG and us have the maturity to ease into our own version of national health care for all. We should all be enjoying the same level of health care as CIG employees, with similar costs.
I am hopeful. Trust, but verify. ;o)
Asinine comment, have you reviewed their financial statements?
Their AM Best rating is currently under review. Lets see if it stays at A+ after the dust settles.
The big question I have for Saunders is, “Will this expansion of CINICO allow me to have coverage where I can have my doctor of choice from the private sector?” If this is just more of the same that forces people to use HSA and government doctors he can forget it! If I cannot have the required health insurance coverage to remain with my private sector doctor who knows my health history, and who I trust then what is the sense of this?
It makes a lot of sense to remove the profit element from health care premiums. So long as it is not replaced by waste, incompetence, fraud or all three. Hmmm.
Batten down the hatches, this is a guaranteed black hole for CIG finances. Like CAL, Turtle Farm etc we are going to be told that they make money out side of the CIG subsidy. You don’t have a large enough population to spread risk for health cover. Your better bet is to have all of the insurers bid for a single government policy or you will just continue to lose insurers like Generali. There is very little money to be made in this market.
A great Socialist idea.
Let’s see ALL the MP’s sign up for this! It is not so much about affordable healthcare but equality of healthcare for all, rich or poor!
This is a crazy idea
Just Another Day in Absurdistan
Government should NOT be competing with the private sector in any industry.
Saunders has lost the plot and going too far with his socialist JLP/PNP type of politics that has already helped to ruin our neighbor.
What do you suggest?
Fuggitall. Get rid of those self-servers and get back to Brit rule!
Why not..How the hell else will the private insurance companies stop charging us exorbitant rates for insurance.. The amount I am paying now just for myself as a small business owner is like having another mortgage..Competition will bring down the cost and if government has to get in to keep them in check then I say go for it.. The private insurance companies have raped us long enough..
A bit like the Civil Service, they will need to double their staff at least to handle this lot and I bet there will be problems. They should stick to health insurance initially and to providing affordable cover for the indigent, retired private sector workers, and others who need it, but why restrict pre-existing condition coverage to Caymanians only?. What happens to a private sector worker who has spent his whole career working here, but loses his health coverage on retirement (usually the case), and has a pre-existing condition (often the case) but has a minimal pension and cannot afford his punitive medical insurance premiums. Do we allow them to die off?.
That is great, but what was reason for generali leaving ? Perhaps look at putting some controls on the medical industry. A doctors visit with co pay insurance shouldn’t still cost over $50 out of my pocket for a 15 minute consultation. Perhaps that’s somewhere govt could start…
That’s because the amount of the visit paid to the Insurance company has remained static for 20 years (the doctors costs have increased, hence our co pay has increased). Question is, if the insurance company gets the same amount, why have our premiums almost tripled in 20 years?
How about the elderly that are paying $250 per month for no benefit other than catastropic care? All the rest comes out of their pocket. For some, that is the ONLY health care available, at least until health care costs suck their savings and retirement down the point where they are considered indigent.
This won’t end well.
Too big to fail? Think again.