PMI: Roundtable concludes CP187 proposals do not fully meet the demands of PMI business
Concerns have been raised by the private medical insurance (PMI) industry over a number of points outlined in the Financial Services Authority's (FSA) cons-ultation paper (CP) 187 - the regulatory proposals for insurance selling and administration.
Discrepancies over the length of renewal periods, status disclosure, 'demands and needs' statements, the volume of information given to customers and the potential cost of complaints were discussed at an industry roundtable, chaired by the Association of Medical Insurance Intermediaries (AMII).
A letter - a copy of which is printed below - has been sent from AMII to the FSA voicing these concerns.
On renewal times, CP187 proposes a 21-day notice period. Although this may be adequate for other insurances, attendees agreed it should be extended for PMI business, where group schemes, in particular, may need more time.
"The FSA is pigeon-holing the timescale to be used by the whole general insurance market," said Angela Darling, head of policy at the General Insurance Standards Council.
Attendees felt the demands and needs statements were flawed, as many customers do not know what they want from a PMI policy until later in the advice process. "It is only when you compare benefits that they begin to know what they want. To provide a 'demands and needs' statement on initial contact may not be relevant," said Stephen Walker, regulation liaison officer at AMII.
Other issues highlighted in the debate were status disclosure, where some guests felt there should be clearer rules to state on whose behalf advisers are acting, and the cost of complaints - where attendees suggested fees should be proportional to a firm's size and industry sector.
