In tight times companies can see PMI as a luxury. What can an adviser do to counter these thoughts? Alistair Sclare looks at the opposing arguments.
Selling insurance is never easy. Selling private medical insurance when times are tough is even more demanding. Recession intensifies people's suspicions about the value of an intangible, only-useful-if-something-goes-wrong product. Something like PMI may be seen as a luxury item so when the chips are down, some chief executives and finance directors might understandably conclude that the cost of its premiums cannot be justified, or that in the face of having to make spending cuts, dropping it is the least painful option. The routes to the conclusion are many, but the outcome is the same: more pressure on sales and retention.
Operational Effectiveness
But PMI should not be seen simply as a cost but it is an ongoing investment in the ability of a business to maintain its full operational effectiveness. It is a tangible expression of the value a business attaches to its prime asset: its work-force; and many key members of that workforce expect to be provided with PMI. Once experienced, it is not a benefit that people take kindly to losing and we must remember, it is not easy to buy it back later on the same terms.
If anything, the current economic climate makes PMI more important than ever. Are management and employees any less vital? Can the business survive more easily if people are away from work for longer than is strictly necessary? Are your clients' customers more forgiving about delays and disruptions caused by unplanned absence?
Of course not. Now, more than ever, businesses need to be capable of delivering first-class service to their clients. And for this level of service to be maintained, staff must be on top of their game.
So the simple marketing message to an SME is: by maintaining good PMI coverage for the firm, you are providing individuals with access to high-quality medical treatment that will hopefully reduce the amount of time they need to spend off work through sickness or a long-term debilitating injury.
After all, any business worth its salt invests in proper maintenance for its plant and machinery alongside investing in health and safety prevention to avoid the exposure of the business to potential liabilities. Therefore, isn't the availability of PMI a form of risk management geared towards the health of the people in the business? Will it not offer some valuable protection against the absence of key personnel?
Keeping people fit and well is clearly crucial for the continued success for any business, as is the ability to offer appropriate and targeted employee assistance packages to help limit absence and to identify areas where everyday stresses and strains are being felt more keenly.
As a neat ancillary benefit, the provision of such a valuable employee benefit will boost morale and strengthen the attachment of key people to the firm. It also reinforces the values of the business and its commitment to employees to build a great place to work. Research shows consistently that happy people make for good, successful and profitable companies so investment in healthcare and employee wellbeing not only makes good sense, it makes good business sense too.
Plugging the gap
Such a marketing tactic might be met by a response which says that PMI is not necessary because the NHS provides such a comprehensive service - delivered free to the patient at the point of need. But good as the NHS is (and when it is good, it is brilliant), it cannot do everything. It has constraints and certainly will not be immune to the effects of the economic downturn. Whatever our political views, we have not been deafened by statements of the extensive NHS investment plans of any party in recent months. Medical advancement and inflation however, continues unabated as does the demand for treatment. Recognising this, and acting to plug the gap, does not mean being anti-NHS. It simply means that there is a need to put in place a pragmatic strategy that reflects reality.
Continuing the earlier theme, when someone is running a business and a piece of the plant breaks down, or the computer server goes on the blink, or the delivery van is involved in an accident, the boss wants the problem solved swiftly, efficiently and with the minimum of fuss and delay. Downtime costs money, threatens contracts and puts relationships under strain.
If this is the case with mechanical and physical items, how much more true is it of a company's people? Time off work is money lost, and it is cost incurred in hiring temps or paying overtime to colleagues. When key employees are away, the best a company can do is tread water. Projects are put on ice and creative thinking is stalled.
PMI is an essential business tool for an small-to-medium enterprise (SME) because, within reason, it puts the business in control of appointments and treatment times. It is possible to see medical experts promptly and at a time and place that is convenient for the patient and the business. And because of the nature of PMI-funded care provision, the impact of cancellations, delays and extended waiting times is likely to be reduced. Disruption is thus kept to a minimum.
No-one is saying PMI buys better care. Whether it does or not is not really the point. What PMI does is make the care accessible. It introduces flexibility and the ability to decide what happens, and when. This can be priceless for an enterprise where there is no slack in the system and any unanticipated absence results in an untreatable headache for all concerned.
Another message to offer to a sceptical or cost-averse employer is the fact that PMI facilitates access to some treatments that are simply not available on the NHS, or for which there is such competition as to make the waiting list unacceptable. On smaller problems, such as physiotherapy, a person might visit his or her GP and get referred for treatment on the NHS and find that, by the time they get it, the real opportunity for benefit will have passed. But with PMI, if you need the treatment now, the cover will provide it.
No postcode lottery
There is also no postcode lottery with PMI. A good policy will provide access to the highest level of care within ready access of where the person works or resides.
But the merits of PMI are more than just the mirror-images of NHS provision. PMI-funded care facilities are specifically designed to make the treatment as comfortable and easy as possible.
No-one enjoys going into hospital, whether as an in- or outpatient. Indeed, the anticipation of a visit or stay can induce stress and worry, making the patient feel worse. But at least in a private facility, any anxieties about the quality of accommodation should be reduced.
Private provision means a single room, exceptional cleanliness, choice of food and relaxed visiting times. The surroundings will be quieter, more pleasant and, in all probability, the patient will have more and better access to a consultant.
This is all valuable, but there is more to it than simply cosseting the individual. Someone with a physical complaint might well be able to handle paperwork or use a laptop - or even have constructive meetings with colleagues on pressing matters. Try doing any of that in an NHS hospital.
Marketing PMI in the current climate is not about trying to find the cheapest deals and thus reducing the client's spend. It is about finding a strong insurer with a reputation for good service which will provide value for money. The product is not cheap because the service provided is not cheap. Brokers should be confident in the strength of the marketing arguments as to why PMI is so valuable.
Alistair Sclare is healthcare director at Groupama Healthcare
