The chairman and deputy chairman of the British Insurance Brokers' Association (Biba) healthcare focus group have resigned leaving the body in turmoil over its private medical insurance (PMI) scheme and healthcare direction.
An extraordinary general meeting (EGM) has been scheduled for early June to address the issue which it is believed has largely been caused by the launch of the Association's PMI scheme in partnership with Jelf and Axa PPP.
Biba has denied that the decisions were related to the PMI scheme, instead saying they were due to health and job role changes.
However, COVER understands that although the official reasons for the resignations of chairman Glen Smith (managing director of Healthcare Partners) and deputy chair Stuart Scullion (managing director of Private Health Partnership) may differ, a significant deciding factor was the implementation of the PMI scheme.
Smith informed COVER of his departure by email after rumours began circulating the market about their decisions.
But despite making several subsequent attempts to contact both Smith and Scullion, neither has responded.
Mike Izzard, managing director of Premier Choice Healthcare, is a co-opted member of the healthcare focus group and confirmed both Smith and Scullion's resignations.
"Glen told me he was very unhappy with the scheme and although he didn't tell me in so many words, it doesn't take a genius to work it out," he explained.
"Stuart was wondering if he should be a focus group member and with his role at PHP changing he would have come off in due course, but the speed at which he made his decision was motivated by this product I suspect."
Izzard was unsure of what route the group would now take and whether he would be welcome to join the EGM given his co-opted status.
And although he did not want to blame any particular party, Izzard suggested Biba had misjudged the market they were approaching and that the PMI scheme should be withdrawn.
"The concept of whole thing was flawed," he said.
"Healthcare has its own dynamics and whatever happens in other general insurances will probably not lay over to it, as has been shown by this, so I think its misconceived.
"The misconception was Biba thinking they could promote a PMI product to their members and how they did it was unfortunate, but I just don't think they should have done it.
"They were going to please one broker and one insurer and cheese off all the healthcare brokers and probably five or six insurers, so they've won no friends and influenced no-one with that decision," he added.
Izzard noted that during his time as chairman of AMII, he and the executive committee decided that it was a representative organisation and such a move would not have been taken there.
Instead, Biba should have directed the general insurance brokers to its healthcare specialists.
However, Izzard expects the focus group to recover and said the two bodies needed to work together for the good of the industry.
"As an AMII member we need a strong Biba," he continued.
"The two have been working together on other issues and this one has overtaken everything and caused a lot of indecision.
"Its also inevitable that disaffected members will be moving to AMII and someone has already called me asking if AMII would take them back," he concluded.
However, Biba disputed the suggestions that the PMI scheme has caused problems on the focus group and said the sector would continue to play an important part in its operation.
In a statement to COVER, Peter Staddon, head of technical services at Biba, said: "The changes to the chairmanship and deputy chairmanship are not connected to the launch of the scheme.
"People's health and job roles change and these issues are affecting the committee. We will be meeting with the chairman to discuss the handover of the role.
"Our committees always have changes as we seek to deal with developments and refresh the groups, and it is our intention to retain a focus on PMI and healthcare matters through a group of specialists."
Staddon also noted that the scheme was still open in its amended format and was a valuable tool to brokers.
"The scheme remains available to all Biba members and is directed at general insurance brokers who do not specialise in PMI, although specialist PMI brokers can also access the scheme.
"It benefits members by offering access to complex markets and products that might not otherwise be available to them.
"There seems to be a lot of misinformation connected to the scheme and committee and we are in the process of clarifying some of the press statements with members but members can also get in touch directly with Biba," he added.
