Private medical insurers need to start innovating group products if the market is to grow, accordin...
Private medical insurers need to start innovating group products if the market is to grow, according to employee benefit advisers Gissings.
Speaking at Laing & Buisson's private healthcare insurance conference, director John Dean described the market as "getting very boring" and called for providers to create new products, including a hybrid plan incorporating both private medical insurance (PMI) and income protection.
"We are desperately in need of new product ideas for our clients. The market is broadly static and getting very boring. We need more choice and more insurers to break into the market – we have less choice than five years ago.
"The Government is ignoring this market, but tax changes are needed to innovate. Insurers need to come up with solutions to avoid tax, such as a hybrid income protection/PMI product," he said.
Dean urged the third and fourth-largest PMI providers – Norwich Union and Standard Life Healthcare – to "start pushing the big boys." He said while BUPA and AXA PPP healthcare continued to dominate the market, it would be harder to move products on.
A more pro-active approach to direct sales by insurers was also called for. Dean said: "There is a real problem – insurers say we are not selling enough products. But that is not my job, I do not sell products, I sell advice. The reason only 11% of companies have cover is because no-one is selling products. Direct sales have a crucial role," he said.
