Client Background
The client is a leading takaful insurer in the UAE offering family and medical takaful to corporate, SME and individual customers through a broad provider network. Like much of the market, it relied on third-party administrators to process medical claims and manage pre-approvals, which limited its control over turnaround times, service quality, fraud detection and claims data. Inconsistent processing timelines and rising claims costs were affecting member experience and renewals, while consolidation among administrators was adding business continuity risk. Cedar was mandated to assess the feasibility of building a full-service, in-house medical claims model and to recommend the way forward.
Cedar’s Approach
Cedar ran an eight-week feasibility assessment built on five steps: programme kick-off and data collection, secondary research, industry conversations, internal analysis with financial projections, and recommendation. The work combined market evidence with a purpose-built feasibility model.
External Assessment – Cedar reviewed the UAE macroeconomic and demographic outlook, the global, regional and UAE insurance and medical insurance markets, the competitive landscape of conventional and takaful players and their claims operating models, regulatory expectations on data protection, claims transparency and fraud prevention, and trends such as administrator consolidation and AI-driven claims automation. More than nine conversations with market players validated these findings.
Internal Assessment – The team analysed the insurer's business performance, customer base, claims operations and turnaround patterns, product lines and technology landscape, including its core insurance platform, broker and customer portals and regulatory integrations, and summarised the position in a SWOT analysis.
Feasibility Model – Cedar built a financial model comparing the current administrator-led model with an in-house model under realistic and aggressive scenarios, using building blocks for gross premium, administrator fees, cost of claims, manpower, and IT investment and maintenance. A productivity-based headcount model sized the functions an in-house operation would need, from pre-approvals, claims processing and fraud, waste and abuse to contact centre, customer service, provider network, reconciliation, compliance, analytics, finance and IT.
Success Factors and Risks – Cedar defined the business, operational, people and technology success factors, the key opportunities and implications of bringing claims in-house, and the principal risks with mitigations such as phased implementation, parallel processing and dedicated transition support.
Strategic Outcome and Way Forward
The assessment concluded that an in-house medical claims model is feasible and more profitable than the administrator-led model over the long run in both scenarios, while giving the insurer direct control of claims, faster resolution, stronger fraud prevention and better use of claims data. Cedar recommended moving to the in-house model, supported by a larger member base, a dedicated talent pipeline, upskilling of existing staff, an internal claims centre of excellence and a hybrid transition with partial administrator support.
As the next step, the insurer is to select a best-fit claims processing platform through business requirements definition, RFP issuance, supplier workshops and scoring, reference checks and total cost of ownership review over an eight to ten week programme.