South African medical insurance and financial services group Discovery has announced plans to establish a new, health-focused insurance technology (InsurTech) business called Amplify Health in partnership with AIA Group.
Amplify Health will operate as a joint venture in Asia (excluding China, Hong Kong and Macau) and hopes to become the “leading digital health technology” business across the region.
Former Discovery Health CEO Jonathan Broomberg will lead Amplify Health as CEO.
“The business will provide a range of state-of-the-art, production-tested health technology, intellectual property and expertise to AIA’s rapidly growing health insurance businesses across the region, and will also build and deliver health and wellness InsurTech products and services to third parties,” Discovery told its shareholders on Tuesday in a statement.
“This JV is built upon and will extend the very successful partnership between Discovery and AIA, which will continue to operate alongside the new JV. The JV combines Discovery and AIA’s distinctive and complementary strengths, bringing together Discovery’s market-proven health insurance technology systems and assets and its Vitality technology platform and assets with AIA’s market-leading businesses, brand, unrivalled distribution platform and decades of well-established execution capabilities across Asia,” Discovery said.
It said demand for healthcare services in Asia is large and growing rapidly, supported by rising wealth, ageing populations, greater focus on health and wellness, and increasing disease burden.
“Annual healthcare expenditure in Asia only represented 4-5% of the region’s GDP in 2020, which is well below that of developed markets. Across AIA’s markets, healthcare expenditure is expected to exceed US$4-trillion in 2030. By this time, there will be 2.6 billion people in the middle classes in Asia, who will be significantly more engaged with improving their personal health than previous generations.”
Discovery will own 25% of Amplify Health and earn additional income and value for the assignment of intellectual property ownership and transfer of expertise. AIA will own the remaining 75% of the JV.
“Discovery will transfer its full health technology stack along with a substantial number of skilled personnel. Discovery will assign, for the region, ownership of the Health IP and the Vitality IP (excluding China, Hong Kong, Macau and Japan, given its partnerships in those markets) to Amplify Health. This will ensure the JV has an end-to-end capability.”
The transaction must be approved by the South African Reserve Bank. – © 2022 NewsCentral Media