IEBA Conference Legal and Compliance

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Quality health plans & benefits Healthier living Financial well-being Intelligent solutions IEBA Conference Legal and Compliance Laurent de Veyrac Oslo, 12 th October 2016

Who is? Backed by the Strength of Aetna, a Fortune 50 company in the 2015 Fortune 500 list* Over 50 years experience in the International Insurance space Global footprint Over 200 countries/territories Annual Inc turnover of $60.3 billion in 2015 Providing health insurance services for nearly 700,000 members worldwide 2

Leveraging our heritage to serve customers Aetna 160 years 23.7M medical members 50,000 employees Integrated Systems Investment Opportunities Health Technology Provider Networks 50 years 700,000 members 1,100 employees

C O LOMBIA Our Global Service Footprint Seattle, WA El Paso, TX Toronto, CA Hartford, CT New Albany, OH Blue Bell, PA Tampa, FL Latin America & Caribbean Cayman London Dubai Abu Dhabi Foshan Qatar New Delhi Singapore Kenya Mainland China Bangkok Hong Kong Shanghai Manila Network Staff Member Services Clinical Care Managers

Regulatory landscape No country s domestic insurance laws and regulations cater for cross-border health insurance. International health insurance law does not exist. Which laws apply when an employer s country of incorporation, the country/ies in which an employee is living, and the employee s nationality are all different? In this grey and complex regulatory landscape, Aetna has evaluated regulatory and legal risks in key countries to work out how to conduct business in a compliant way. Aetna can help you navigate this challenging environment to find compliant health insurance solutions for your employees. 5

Common themes/hurdles Regulators generally require insurers to be locally admitted/ have local licenses. Aetna has a combination of local licenses and arrangements with local insurers. We are constantly exploring ways in which we can expand our direct licensing footprint, e.g. acquisitions, joint ventures. Where are you as employer incorporated? Where are your employees? What nationality are they? Local nationals can be a challenge. We will focus on three countries USA, UAE and China outlining the regulatory regime in each and describing how Aetna provides health insurance solutions for employers in/ sending expats to these countries. 6

USA Regulatory regime Key points Employer and employee risk mitigation Aetna s solution(s) Health insurance regime Health insurance is governed by individual state laws and also at the federal level by the Affordable Care Act of 2010 (ACA). These insurance regulations generally (ACA included) do not apply to plans issued and underwritten outside the US by non- Americans insurers. Such plans are mostly exempt from the ACA, except for a few exceptions, notably the individual and employer mandates. Individual Mandate: All US resident alien taxpayers and US citizens must have Minimum Essential Coverage (MEC). Most US plans will qualify. Offshore plans may qualify for non-us citizens depending on circumstances. Failure to have MEC can result in a tax penalty for the individual. With non-us insurance, IRS reporting for the individual may be done by the employer if employees need MEC. Employer Mandate: Failure to provide sufficient coverage levels and affordable coverage can result in tax penalties to an employer. If applicable, certain IRS reporting is required for the employer. Individual mandate: We can offer a US plan to satisfy the MEC requirement or an offshore plan may qualify and in that case Aetna can assist with the IRS reporting process, if requested. Employer mandate: Aetna can help with general guidance and links to applicable resources. Visa requirements Varies with visa type, but limited for health insurance Ensuring sufficient coverage levels if needed Most Aetna plans meet these levels 7

UAE Regulatory regime Key points Employer and employee risk mitigation Aetna s solution(s) Health insurance regime United Arab Emirates (UAE) comprises of seven emirates, however, only two emirates Abu Dhabi and Dubai have implemented mandatory health insurance schemes. The Abu Dhabi & Dubai mandatory health insurance schemes are applicable to expats holding Abu Dhabi or Dubai residency visas and local nationals residing in the emirates of Abu Dhabi or Dubai. The employer s obligation in Abu Dhabi is to provide health coverage through a locally admitted insurance carrier for its employees, spouse and up to three dependents below the age of 18 years. The employer s obligation in Dubai is limited to provide coverage through a locally admitted insurance carrier for its employees. Aetna has a strategic relationship with a locally admitted insurance carrier Al Ain Ahlia to provide compliant health insurance cover in Abu Dhabi, Dubai and other emirates of UAE. Aetna administers such plans. Visa requirements Compliant health insurance coverage is required for obtaining residency visas in Dubai & Abu Dhabi 8

UAE Regulatory regime Requirement Dubai DHA Abu Dhabi HAAD Applicability Applies only to members holding Dubai visa, irrespective of where they reside or work Applies to members holding residency visa in the emirate of Abu Dhabi Employer s Obligation Employee s Obligation To provide medical cover only to his/her employees. To provide medical coverage to his spouse, children and other dependents sponsored by him/ her. To provide medical cover his/her employees, one spouse and three children below the age of 18. To provide medical coverage over and above one spouse and three children Minimum Coverage / Policy limit AED 150,000 (USD $ 41,000) AED 250,000 (USD$ 70,000) Applicability Applies only to members holding Dubai visa, irrespective of where they reside or work Applies to members holding residency visa in the emirate of Abu Dhabi 9

UAE Case study A company registered in Germany wants to buy our UK policy covering its 100 members located globally, 5 of whom are expats located in Dubai. We provide locally admitted insurance cover through our UAE partner AAA for these 5 Dubai members. We would cover the remaining 95 on our UK plan. CASE SOLUTION 10

China regulatory regime Key points Employer and employee risk mitigation Aetna s solution(s) Health insurance regime For an individual residing in the China, the individual insurance policy should be issued by a Chinese insurance company, except under following circumstance: According to CIRC rules, it is allowed if the expats residing in Mainland China actively and voluntarily purchase overseas policies. For any group/policyholder located in China (e.g. a company registered in China), the group insurance policy must be issued by a Chinese insurance company. The Chinese government has almost completed the introduction of insurance-based health funding systems for urban employees. There are mandatory employer and employee contributions under this social system. Insurers have developed group supplementary health insurance policies which fill in many of the "gaps" in urban employees' social health schemes. Aetna has three Chinese domestic strategic relationships which are China Life, Huatai and Starr China. Through these Chinese insurers, we offer various health insurance plans. We have local operational teams in China to provide administrative services to these plans. For any group/policyholder located outside of China but with some members (expats and/or Chinese nationals) located in China, it is possible to cover the whole group under offshore policies. 11

China case study A company registered in Denmark wants to buy our UK policy covering its 100 members located globally, 5 of whom are expats located in China and 5 of whom are local nationals located in China. CASE We can cover these 10 Chinese members on our UK policy. SOLUTION NOTE: However, if the policyholder is a company registered in China, we need to cover this group through one of our Chinese domestic strategic relationships, e.g. Huatai plan. 12

Other challenges Brexit Business as usual for Aetna all EU laws, rules and rights still apply in the same way. Post-Brexit UK is currently an unknown. In the event Aetna s UK insurer is unable to passport into the EU post Brexit, Aetna shall actively seek to revive its dormant Irish insurance licence. Our customers should see no adverse impact. 13

Please note This presentation does not equate to legal, regulatory or tax advice. Aetna does not provide care or guarantee access to health services. Not all health services are covered, and coverage is subject to applicable laws and regulations, including economic and trade sanctions. See plan documents for a complete description of benefits, exclusions, limitations and conditions of coverage. Plans are underwritten by Aetna Insurance Company Limited, registered in England (Company Registration No. 05956141), which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Firm Reference No. 458505). Plans are administered on behalf of the insurer by Aetna Global Benefits (UK) Limited, registered in England (Company Registration No. 03554885), which is authorised and regulated by the Financial Conduct Authority (Firm Reference No. 312279). Both companies are registered at 50 Cannon Street, London, EC4N 6JJ, United Kingdom. Aetna is a trademark of Aetna Inc. and is protected throughout the world by trademark registrations and treaties. 14

Thank you