Perhaps more often thought of as a protection provider, Exeter Family Friendly is a major player in the PMI market with serious growth plans. Paul Robertson discusses the changing market with Mike O'Brien.
“We have come to realise we have to develop a new class of products, and we are very specifically calling that an entry-level product,” O’Brien said. “I say entry-level because I don’t want to call it a budget product. Budget, people always focus on price: entry level is a way that we can get people who have not engaged with private medical insurance to maybe take that first step.
“The challenge for building an entry-level product is to extend that philosophy into something that is not as comprehensive.
“So what have we done about it? Well, we have the bare bones of an idea and have sent it to a number of intermediaries. We just said, ‘Here is the outline of a product. Please challenge it’.
“We will get some feedback. When we have done that, we can then put the second iteration out, which will be the product with some indicative pricing.”
The elephant in the room for lower-priced plans is always cancer cover, which tends to be the part that people worry about.
O’Brien is adamant that Exeter does not believe cancer or cover for cancer is something where you can impose limits or muddy the water: you are either in or you are out. The philosophy is that customers fall into two distinct camps: those who believe, quite rightly in many cases, that the NHS is the place to be. And others who say there are these drugs that sometimes are not available, so I am making that choice.
“We said, on our flagship product, you’re fully covered for cancer, regardless of cost, it is all about clinical outcome. The only thing we would not cover was experimental treatment,” said O’Brien.
“When we put the sister product on the market. You now make a choice: you can choose fully in or fully out. There will be no variations on your cancer cover.”
Income protection
Exeter Friendly’s other product, income protection, has been blending into also becoming a health product, especially in the corporate arena. It is increasingly known it will offer a health benefit if it will get you back to work and therefore no longer claiming. There is a clear link between early intervention, rehabilitation and someone’s likelihood to return to work.
The challenge for Exeter and other retail propositions is they have to talk carefully to clients about rehabilitation to avoid the perception they are trying to get out of paying their claim.
“We have paid for people to have private treatment to accelerate their return to work, but because we agreed with the member that we could do it and they agreed they wanted us to. So we do not have this same control as an employer does or as an occupational health service would do, so we have a dialogue with the member, treating them as individuals.
“We have to be careful that we do not go back to the suited occupation, or the workplace tasks, because too much intervention in trying to rehabilitate or to suggest to customer that they could do something else, puts us right the way back in that space.
“We have to ask; why are people buying our product? For some it is rehabilitation, and for some it is just paying the plan.”
Many providers give the impression they react to market forces rather than have a coherent plan for their company’s future. Exeter can see with absolute clarity where its market share is, and is adamant that it punches above its weight.
O’Brien is happy to conclude: “I think we have actually got ourselves in a good little space, and it is something we will continue to build on.”
