Money down the drain?
Waiting times are at record levels and, according to not-for-profit health insurer WPA, PMI is more valuable than ever.
At the height of the pandemic, private medical insurance suffered a blip. Customers rightly wondered why they paid a premium for a private service that they could not use due to ongoing restrictions and private hospitals being requisitioned by the NHS.
However, as soon as normal service resumed, and with growing queues for NHS treatment, the importance of health insurance has been underlined.
Data from price comparison website and broker ActiveQuote shows that sales of PMI to first-time customers increased by 100% on average between November 2020 and January 2021 compared to between March and May 2020. Of course, a primary attraction of PMI is its ability to enable you to jump the NHS queue and, with recent NHS data showing almost five million people in England are waiting for hospital treatment, that queue is now longer than ever.
Brian Walters, managing director of specialist PMI broker Regency Health, explains: "Policyholders are making use of their PMI when they might otherwise have used the NHS and, although it's true that waiting times to see private consultants are longer than usual, they still pale in comparison to waiting times on the NHS."
Virtual appointments with GPs and consultants facilitated by PMI and without any relaxation in care standards, were indispensable during the pandemic. Indeed, PMI policies have become valued for their ability to offer added-value services like remote GP services, online mental health support and video physiotherapy.
Last year WPA became the first insurer to offer an ‘instant' health insurance claims authorisation process, enabling customers to get real-time authorisation of initial treatment without needing to speak to anyone. With a third of customers registered for their WPA Health app, this is proving a popular feature.
No more ‘profits over people'
The myth that PMI has been a waste of money during the pandemic has been further exploded by the decision by some - but by no means all - insurers to compensate customers for when they weren't able to derive maximum value from their policies. WPA has been both the most transparent and the first to act.
Kathryn Vellacott, business development general manager at WPA, explains: "As a not-for-profit company, our focus is on our customers, and we remain committed to not profiting from the pandemic and ensuring our benefits are useful."
WPA provided a customer rebate worth around 40% of monthly medical premiums in April 2020, followed by similar rebate in June 2020 costing in the region of £8m.
"It was the right thing to do at the right time and I'm pleased another insurer has followed suit, albeit a year later," concludes Vellacott.
GlobalData insurance analyst Yasha Kuruvilla says this was an important move for the UK industry, where premium rebates are not very common because WPA's early move may help to "postpone the erosion of customer relationships."
This myth-busting article is one of a series of 10 addressing common myths around PMI. Access the full list
