PMI will remain core to people's long-term planning, says Mike Hall
The recent Budget gave the case for PMI being a central financial planning tool the biggest boost it has had in recent years. Despite the Chancellor not mentioning it by name, or introducing incentives or removing some of the disincentives that act as a barrier to many who want this essential benefit, he went as far as to say that his vision for the NHS, as developed by the Wanless Report, would become the best insurance option for people's healthcare.
So why am I confident PMI is moving in the right direction when it comes to it taking a bigger role in financial planning? The very acknowledgement by Wanless, the Chancellor, the Government and the opposition, of the short, medium and long-term needs of the NHS, and how long we need to be patient to satisfy them, shows change will take its time in coming. We are doing the NHS and its staff a disservice by allowing ourselves to believe any different.
The extra money promised in the Budget is to be welcomed. The Wanless Report has made some pertinent observations about the options available, including the desirability of the NHS working more closely with the private sector. But when people start to think about their own situation, beyond this year, to medium and long-term financial planning objectives, healthcare planning must become a central element. The statistics are well known ' many of us will either personally suffer from a serious illness in our lifetime, or probably have someone in our household that might be similarly affected. To take healthcare and financial planning decisions that rely upon change to the NHS happening soon is no longer going to be good enough.
There is clearly a point emerging, which, despite a lack of incentive or even in the face of disincentives, people simply vote with their feet when it comes to healthcare. One only has to look at the growth in company-paid PMI and in modern self-pay with insurance backup plans.
One of the ways in which we as insurers need to continue to change is to acknowledge the many new ways people want to fund healthcare, and continue to innovate to satisfy that demand. This is what will give IFAs and intermediaries the tools they need to keep healthcare at the heart of planning for clients.
I am pleased that, following the Budget, we are finally talking about planning over two decades for the NHS and healthcare funding. One important fact is the view of the emerging generation who will be the patients, doctors, nurses and tax-paying funders of the NHS over the next 20 years.
Keeping up with the advanced thinking and increasing expectations of the next generation is the biggest challenge to face governments, the financial services industry and medical insurers over the coming years.
By working together we can make progress by keeping healthcare planning close to the centre of financial planning. I am confident we will do this, having fresh starting points such as the Wanless Report and the Budget for healthcare to work from.
