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PMI premiums up as costly claims Climb

A new report by Datamonitor has found the cost of private medical insurance in the UK is rising as increasing numbers of ageing policyholders make claims.

Research by the market analyst shows escalating claims by elderly customers and static market conditions are combining to increase the cost of premiums to an extent which leaves many people unable to afford PMI.

It points to the decline in the number of individual policyholders while group PMI sales have risen over the past five years. Between 1995 and 2000, Datamonitor says the number of group PMI schemes increased from 1.8 million to 2.3 million while individual plans fell from 1.3 million to 1.2 million.

It says the low levels are exacerbated by factors including consumer uncertainty over state initiatives, expensive premiums and ignorance over the cost and funding of long-term care. But it claims the overriding concern for the PMI market is that the number of individuals covered has remained roughly the same for the past five years. Only 200,000 more people held PMI last year than in 1995,an increase from six million to 6.2 million.

Datamonitor says health insurers need to modernise products and marketing to boost PMI uptake among consumers who are concerned at paying high premiums for insurance they believe they are unlikely to need.

Financial services analyst and report author James Allingham says: “The only way that health insurers can significantly improve customer acquisition, particularly in the individual market, is through the development of cheaper and more tailored products.

“To acquire the younger spectrum of potential PMI customers, insurers need to put these products on modern distribution platforms, such as the internet and interactive television.”

PMI market, p53


Sagitta produces cure for a hedge headache

Sagitta Asset Management has come up with an aspirin for the hedge fund market with the introduction of the salix fund.Salix, which is named after the willow tree that provides the chemical for aspirin, is a hedge fund aimed at the high-net-worth investor who is looking for growth.The fund will invest in different areas of […]

Scot Equ calls on pensions industry to keep up with social change

Scottish Equitable is urging the pensions industry to keep up with social change such as issues surrounding the payment of pension death benefits to homosexual and common-law partners. Scot Equ pensions development director Stewart Ritchie says there is increasing mismatch between rules for dependants&#39 pensions and the way society is evolving, where increasingly people are […]

UCB adds to buy2let range

UCB Home Loans, the specialist lending arm of Abbey National, is bolstering its range of buy-to-let products with the five-year fixed buy2let mortgage.UCB has fixed the mortgage rate at 6.89 per cent for the first five years and for loans of up to 80 per cent of the value of the property. The maximum possible […]

Bristol Contrib Welfare appoints 2 marketing chiefs

Bristol Contributory Welfare Association Healthcare has made two senior level appointments in its marketing department.Howard Hughes joins as sales and marketing manager after 15 years with Bupa where he was marketing and development manager for dental cover.Andrea Bridgeman is going to BCWA to take charge of day to day marketing activity from Clerical Medical International […]


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