Engage Mutual has reported 20 to 30% of broker take-up of its new corporate cash plan has been to underpin PMI excess policies.
David Castling, commercial sales manager at Engage Mutual, said the cash plan had seen successful take-up since the launch earlier in the year; as a cheap alternative to unaffordable PMI but in part due to the cash plan-excess combo trend.
He said: "From a broker point of view it makes sense. And this may well be a short-term solution to keeping cost down, but from a provider point of view, how do you control claims?
"As a stand alone it does not really affect us, but for a provider who offers both I do not understand how that will be sustainable. And those providers selling both together will not necessarily make more profit either. The only thing to gain could be market share."
He added Engage could try and swim against the trend, but understood why the market was going this way.
According to Castling, if the market continued along this path it would only be two or three eyars before something else needed to evolve. He warned brokers against building business mdoels around it.
He added: "But in the main corporates are still very keen on getting something on health and wellbeing and that is driving a lot of the interest in cash plans."