Aon forecasts faster Gulf medical cost growth in 2027 as global trend eases

Employer medical plan costs in most Gulf states are forecast to rise faster in 2027 than in 2026, according to Aon’s 2027 Global Medical Trend Rates Report, published on 6 October 2026, even as the global average eases to 9.0 per cent from 9.8 per cent. The UAE’s gross medical trend rate is projected at 13.0 per cent, up from 11.0 per cent; Bahrain’s at 12.0 per cent, from 7.5 per cent; and Saudi Arabia’s and Kuwait’s at 9.5 per cent, from 8.0 per cent and 7.5 per cent. Oman, which had no 2026 figure, is put at 7.0 per cent. Qatar is the exception, at 3.8 per cent against 10.0 per cent for 2026.

The regional headline points the other way. The Middle East and Africa region shows the largest decline of any region, from 15.3 per cent to 12.2 per cent, but Aon says this is entirely driven by lower inflation: net of general inflation, the regional trend rises to 7.9 per cent from 7.6 per cent. Aon describes two sub-regions, with 10 African markets reporting lower or flat trend and, in the Middle East, only one market reporting a decrease and half reporting increases. Net of inflation, the UAE’s 2027 trend is 11.0 per cent and Bahrain’s 10.8 per cent, against a global net figure of 6.4 per cent.

What Aon says is driving costs

Aon attributes the sustained Middle East increases partly to the ongoing conflict in the region, which it says is affecting the distribution and cost of medical equipment and supplies. It also cites wider adoption of advanced technologies, high utilisation rates, higher tariffs and the growing burden of chronic disease. Cardiovascular disease, cancer and hypertension are the leading cost conditions globally; Aon names the UAE among the countries reporting cardiovascular disease as their most impactful condition, and says hypertension is particularly prominent in the Middle East, Africa and Latin America.

GLP-1 drugs are a newer factor. Aon says these medicines are available in almost 70 per cent of the countries surveyed and covered by employer-sponsored plans in half of those markets, that some countries attribute 1 to 10 per cent of their medical trend to GLP-1s and similar drugs, with an average above 3 per cent, and that Kuwait explicitly cites emerging GLP-1 demand as a driver. For internationally mobile staff, Aon puts the 2027 expatriate medical trend at 11.5 per cent and says expatriate trends typically run 1 to 2 per cent higher than the global average. It says growing availability of lower-cost GLP-1 alternatives in the Middle East is helping affordability, and that expatriate plans more broadly are adopting cost-sharing and local-plus designs.

Saudi payer data show what sits behind those rates. The Insurance Authority’s report on the first quarter of 2026, published on 8 September 2026, put health insurance gross written premiums at SAR 18.5 billion, 62 per cent of the market, with 14.5 million beneficiaries, and the sector’s net combined ratio at 98.3 per cent against 99.9 per cent. Its 2025 market report, summarised by the Saudi Press Agency on 31 July 2026, said health insurance accounted for about 68 per cent of premium growth in 2025, total claims paid rose 10 per cent to SAR 53 billion, and health claims costs and their inflation were among the themes it identified for 2026.

How the survey works, and what it does not show

The survey was conducted across more than 100 Aon locations that broker, administer or advise on employer-sponsored medical plans, and reflects the expectations of Aon professionals based on their dealings with clients and insurers. Trend rates are the expected percentage increase in medical plan unit costs, insured and self-insured, with inflation taken from the International Monetary Fund’s April 2026 World Economic Outlook.

The figures are forecasts, not claims outturn. The 2026 country numbers are the projections from Aon’s 2026 report rather than measured 2026 results, so each change compares two forecasts. They cover unit costs in employer-sponsored plans, not total spending, and do not cover government-funded care. Aon itself cautions that the rates are not an overview of each location’s healthcare costs as a whole. The report does not explain Qatar’s forecast fall, and gives no split between insurers, plan types or mandatory and voluntary schemes.

Our reading

Analysis by The Healthcare Daily.

• Employers in the UAE and Bahrain go into 2027 renewals against double-digit cost trend assumptions from a major broker, with Saudi Arabia and Kuwait close behind. Those with large expatriate headcounts may find brokers pressing the cost-sharing and local-plus designs Aon says are spreading.
• For Saudi insurers, health is already 62 per cent of premiums and the sector’s combined ratio was 98.3 per cent in the first quarter. A 9.5 per cent cost trend leaves little room for price competition at renewal and makes claims control, rather than premium growth, the main earnings lever.
• Hospitals and clinic groups should note that Aon lists higher tariffs and high utilisation among the drivers. Payers responding to that are likely to lean on utilisation management, referral rules and network steering, so providers that can evidence cost and outcomes per episode will be better placed to hold their tariffs.
• For equipment and consumables suppliers, conflict-related distribution costs are part of the trend Aon describes, which favours distributors holding local stock, while payers looking for savings will scrutinise device and consumables pricing more closely.
• For pharmaceutical companies, GLP-1 coverage is becoming a cost line that employers and insurers manage actively, and the lower-cost alternatives Aon highlights in the Middle East are likely to shape formulary and coverage decisions.