Cash plans are the “sleeping giant” of the health insurance industry according to Sir David Perris, president of the British Health Care Association (BHCA).
Sales have more than doubled over the last six years, compared to a 25% decline in the PMI market.
One of the biggest areas of growth has been in the corporate market. This month a report indicated that one in three companies is concerned for the future of PMI as an employee benefit because of rising premium costs. The report was published by Hogg Robinson Healthcare. Rising PMI premiums are forcing many companies to look again at the benefits offered by cash plans.
The BHCA represent 24 cash plan schemes. Sir David, president of the-trade body said: “Cash plans are one of the best kept secrets in the health industry. Sales look set to grow even more.”
Most of the cash plan schemes are non-profit making. The BHCA is trying to promote these products to IFAs and has produced a leaflet to encourage more people to take advantage of the plans.
Sir David added: “IFAs many not make much commission from cash plans but it is important that they know about this market. They can provide a useful add-on to budget PMI products. If IFAs advise clients well, they are likely to come back again for life and pensions advice, where IFAs could earn meatier commissions.”
For around £l a week most cash plans offer £18-£30 for each day spent in hospital, £50 for sight tests and glasses, £75-£100 for maternity leave and £50-£100 for time spent off work.