WESTERN PROVIDENT ASSOCIATION
Type: Individual private medical insurance
Minimum-maximum ages: From birth-65
Maximum benefit: No maximum
Cover provided: Standard cover - inpatient, daypatient and outpatient cover for cancer care. Inpatient and daypatient cover for hospital treatment, specialists fees, diagnostic scans and tests. Inpatient cover for prostheses. Outpatient cover for consultations with a consultant/specialist up to £100 a year, MRI and CT scans, surgical procedures, pre-admission tests two weeks before operation. Nursing at home for up to four weeks, private ambulance, parent staying with a child, NHS cash benefit £100 a night, maximum of £3,000 a year, out of pocket expenses up to £5 a day, hospice donation up to £100 a year.
Excess: 25% of claim subject to a maximum of £1,000, £3,000 or £5,000
Options: Outpatient, therapy, dental, cash plan, worldwide cover
Commission: Initial 35%, renewal 5%
Tel: 0800 7830784
The panel: George Connelly, Partner, Healthcare Matters,
David Eastlake, Director, Westerby Insurance Services,
Lynne Munden, Director, Healthwise,
Guy Jones, Managing Director, Berwick Devoil Healthcare.
Range of Cover 8.0
Premium Rates 6.3
Company's reputation 8.8
Product literature 6.8
Western Provident Association's flexible health is an individual private medical insurance (PMI) plan. It allows policyholders to upgrade and downgrade cover through various options as their circumstances change.
Looking at how the plan fits into the market Jones says: “It is what the market has been waiting for. It allows the individual to choose the cover they want and not have to pay for benefits they do not. It breaks new ground with no worse terms transfers and co insurance instead of excess.”
Connelly says: “It slots into just about every sector. Its modular construction means that it can suit purchasers from low-cost budgets to the upper end. It can be considered for just about every PMI enquiry.” Munden says: “It is a variation to the menu-based plans which are becoming increasingly available in the individual and small company market, allowing the subscriber an opportunity to reduce premiums.”
Analysing the cover available Eastlake says: “The standard cover is quite comprehensive and the options would bring it up to traditional comprehensive cover and beyond.” Jones says: “The standard cover is basic, but it covers the essentials. If clients want a more complete benefit structure they can have it by adding the relevant sections to create a bespoke plan that fits their specific requirements. What more could they want? The dental and cash plan extensions are excellent.”
Munden says: “Choosing a plan that incorporates all options will provide comprehensive cover for both primary and secondary care. However, there is no opportunity to cover any form of psychiatric or counselling service.”
Identifying the type of client the plan would suit Connelly says: “Almost every enquirer under 60. However, the postcode pricing means it may not be competitive in the main population areas.” Munden sees it as mainly suited to the discernible and knowledgeable individual who understands and accepts the restrictions and consequences of excluding an option and the workings of co-insurance.
Jones says: “Anybody who has requested quotes in the past and decided the options were too expensive will now have the ability to fit benefits to their budgets.” Eastlake suggests clients who would appreciate the opportunity to tailor cover to their individual needs.
Considering the marketing opportunities the plan could provide Munden says: “Our individual portfolio consists mainly of group scheme leavers who will be offered this plan as an additional alternative to the plans of their existing insurer. Good options for someone considering self-pay or inpatient only plans.” Eastlake says: “It could be offered to existing clients who have felt that traditional policies are too expensive.”
Connelly says: “It gives a chance to revisit previous enquirers who did not buy, and offer something different. It also offers an opportunity to give the client more involvement and choice. the shared responsibility option should prove popular and may help to restrain claims costs.”
Highlighting the main useful features and strengths of the plan Connelly says: “Flexibility. The innovative shared responsibility option and the opportunity to tailor cover to the customer's needs. The possibility to transfer from another insurer without underwriting and the wide hospital choice available to policyholders.” Munden says: “It has the ability to switch from the current insurer if an individual has previously been medically underwritten and is reasonably healthy. Co-insurance options can work better than an excess for small claims. Standard cover offers enhanced benefits to standard inpatient only plans.”
Eastlake says: “The standard cover is sufficiently wide to satisfy most people. It also spells out what is excluded and what can be added by using the options. This would avoid arguments and disappointments down the line.”
Drawing attention to the plan's drawbacks, the panel agree that a lack of psychiatric cover is a problem. Jones says: “When stress and psychiatric insurance claims have increased by more than 50 per cent in the past five years, you can see why it has not included it. However, it should be covered in some way. Why not include a travel insurance element over and above the worldwide option?”
Munden says: “There is no option for psychiatric cover and there is restricted choice of underwriting, with no moratorium. The benefit split between options requires both outpatient and therapy options to be chosen in order for both pre and post operative consultations and physio treatment to be covered. Premiums are based on postcode mean that individuals living in high-rated areas, for example, London, have no option to reduce rates by choosing a lower hospital level.”
Connelly adds that its flexibility may make it difficult for unsophisticated purchasers and that the application forms are daunting. Like Munden, he is critical of the postcode pricing.
Assessing the company's reputation the panel agree that it is excellent.
Suggesting likely competitors for the plan Jones goes for Norwich Union's medios and optional medios plans, plus Royal & Sun Alliance's value plan. Munden goes for Royal & SunAlliance's values, Legal & General's SecureHealth and Standard Life's choices. Eastlake sees competition coming from traditional PMI providers, while Connelly thinks it will face competition from every policy under the sun.
Jones sees the premium rates as competitive. Munden says: “If the standard and therapy option only is chosen, costs are similar to Secure Heath. However, if additional outpatient cover is required, this increases rates above those of the competitors.” Connelly says: “The standard option is very competitive. Per person pricing means the everyone pays the premium appropriate to them. Postcode pricing means it is competitive in come areas but not in others. WPA is rarely the cheapest choice, but rarely the expensive.”
Jones also thinks the commission is competitive, while Munden views it as in line with the rest of the market. Connelly feels it is average, but mentions that it is paid on the premium received and not the indemnity. Eastlake feels it is reasonable, but says it would help if there was an option for lower initial commission, with higher renewal as this would encourage the servicing of the contract.
Turning to the product literature Connelly says: “It is uninteresting. The colours are drab and the layout is messy. The size is odd. It is too large for an A5 envelope but lost in an A4. Opening the centre pages makes it spread so wide as to be almost unmanageable. The shared responsibility option should be a major selling point, but is the last think a reader sees. An A4 size would enable the information to be displayed more attractively and efficiently.”
Eastlake and Jones think it is good. Munden says: “It is simplistic and concise. it clearly identifies the choice of options but attention is required to the small print in grey.”
Summing up, Munden says: “Consequences of choice must be fully understood and accepted by clients to avoid any misconception and non-fulfilment of cover expected.”