Discontinuation to SME cover should have been explained, argues adviser
PruHealth has been accused by an adviser of putting clients' health at risk by refusing continuation of cover for its small to medium-sized (SME) corporate customers when employees leave the companies they work for.
The intermediary, who wished to remain anonymous, said he had been approached by a client who had been covered by PruHealth under his company's policy. The company was now going into liquidation meaning that the man's employment with them was soon to terminate.
The man's wife, also covered, had developed breast cancer while he was working for the company, and he wished for a continuation of cover with PruHealth so his wife could carry on receiving treatment for her breast cancer.
According to the broker, as a claim in excess of £350 had been made within the past 12 months, PruHealth would not offer continuation. As a result, the adviser said, the breast cancer would no longer be treated under any other private medical insurance (PMI) policy taken out at this point as the cancer would be defined as being an 'existing condition', meaning that the wife had completely lost her cancer cover.
The broker also said that, in a number of training sessions about the product, PruHealth had not mentioned the lack of a continuation of cover: "Twice, we've had PruHealth come and do training on its products, and in neither instance did they mention that they do not do continuation of cover. I spoke to the sales director about this example at length about 10 days ago and I put to him that they should have told us about not offering it. His argument was that PruHealth doesn't have to tell us the negatives of the policy, only the positives."
The broker said he was upset that lack of clarity over this meant he had sold the policy to others who would also be at risk of losing their cover. He said: "I've been selling the product for two years and feel I've put clients at risk."
In response, Dave Priestley, sales director at PruHealth, said: 'PruHealth offers a unique product that gives customers real value in a number of ways and this is what we focus on. We do not currently offer a continuation option but this is something that we continually keep under review. Brokers continue to support our approach and this helped us become the fastest growing provider in 2007.'
The broker said that this situation was unusual in that most insurers would offer continuation of cover in these circumstances. It is COVER's understanding that other PMI companies such as WPA and Bupa offer this.
