JEDDAH: A black market for fake health insurance cards is flourishing across the Kingdom ever since health coverage has been made mandatory for processing residence permits for foreign workers, according to industry sources.
"There are several unlicensed insurance firms operating in the sector. They help foreign workers and their employers secure health insurance cards so they can obtain residence permits (iqamas)," one source told Al-Madinah daily.
Several kiosks have sprung up near passport offices to offer this illegal service. Those running these kiosks are engaged in fraudulent activities in connivance with some sponsors and their workers to help in the issuance or renewal of iqamas, the sources said, urging authorities to beef up monitoring and inspection of such kiosks.
Prominent insurance consultant Rabeed Al-Bahv said this phenomenon is a clear violation of Saudi Arabian Monetary Agency (SAMA) regulations.
"Only licensed insurance companies are allowed to offer health insurance services. However, about 5 percent of applicants approach unlicensed firms to complete health insurance procedures. By this, they want to facilitate only the issuance of iqamas and escape paying regular insurance premiums," he said.
Saleh Malaika, chairman of the board of directors of Salama Insurance Co., said this practice is illegal and a violation of regulations issued by the Health Insurance Council. "By resorting to such practices, the worker loses his right to insurance benefits," he said.
A tour of kiosks operating around passport offices revealed that the fake insurance cards are meant only for the issuance of iqamas. A large number of individual employers have been lured to them due to their relatively lower rates.
They need to pay only SR500 or so instead of the usual SR1,200 charged by legitimate companies.
One staffer at a kiosk said that they would issue a health insurance card only for the issuance of iqamas. An employee at another kiosk said they would issue the insurance card for SR700. "This is meant only for the issuance of iqamas. After this, our role is finished and we will not bear any other responsibility," he said.
On the other hand, a staffer at another office said the health card from their licensed insurance company costs SR1,500 and that they would be responsible for administering the service, which is fully in compliance with SAMA regulations.
Omar Zuhair Hafez, chairman of the National Committee for Insurance, expressed surprise over some Saudi citizens and their workers willing to approach insurance firms that are violating SAMA regulations.
"There are only 31 insurance companies licensed by SAMA. They are extending the best possible services to their clients and there have been no major violations on their part with regard to fulfilling their obligations and payment of compensation," he said.
"If clients find any violations or shortcomings in their services, they can approach the relevant committee. The concerned authorities would take punitive action against those companies that failed to fulfill their obligations, in addition to ensuring protection of the clients' rights."
© Arab News 2011
