Axa PPP's Fergus Craig has a keen eye on PMI. Paul Robertson asks him how the market is improving.
If top-up plans are to become more difficult to design and the economy is depressing sales of PMI with all bells and whistles, what about co-payment or other price reduction strategies?
“At the end of the day full-on PMI, which is what the traditional UK sector has sold, is quite expensive. And the people who buy our product do so to escape from restrictions that they perceive are applied in the NHS.”
Yet, cost control is fundamental to PMI at the moment, isn’t it?
“It’s always on the agenda, but comparatively it moves right to the top of it. Let’s be clear: the biggest source of customer dissatisfaction in PMI is generally price and price increases. It is by and large a product where we – and truth be told, pretty much every insurer – basically pay the vast majority of their claims. So not paying claims is not a massive source of dissatisfaction.”
Fair enough, but products can’t stay static for ever. Where is the movement and in what direction? Axa PPP is currently attempting a closer relationship between its healthcare services and PMI activities.
Craig said: “There’s been a lot of wild talk about ‘integrated health care’ and I think it’s gone off a bit half-cocked. We’ve all made promises that we can’t substantiate. To claim full integration is either going to be untrue or is going to cost so much to deliver for, at the margins, such trivial benefit that you would be unwise to do it.
There are an awful lot of systems challenges but also others, such as data protection.
“We’re focusing a bit more on actually delivering some real co-ordination – a better word than integration – on specific types of claim, where you can get a lot of benefit by getting people back to work earlier and managing things better.
“For instance, with some hideous cancer there’s no point pretending we’re going to get them back to work quicker, whereas backs or mild depression are horses of a different colour. So, we are focusing our attention on actually delivering in those areas and pulling together the bits that we’ve got will get results.”
Of course, increased knowledge of a policy’s likely chances of claim would be a fundamental way of reducing price, thus boosting the market.
One of the main points of contention in PMI markets is the release of claims data in the SME sector.
Arguably the market’s greatest proponent of this was Groupama, recently announced as being bought by Simplyhealth.
The news brought cries of dissatisfaction from many PMI advisers, particularly the Association of Medical Insurance intermediaries, both at the shrinking of the market and the loss of a data release champion.
Axa PPP is among those insurers firmly against the release of small group claims data, but has this issue died now? Is someone else going to take up the cudgel?
Craig is sanguine:
“Clearly, either Groupama will move to what Simplyhealth want to do, or Simplyhealth will move to Groupama. It’s slightly hard to imagine that they’re going to do two different things.
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