Anyone that has sold private medical insurance (PMI) – and I would imagine that many readers of Health Insurance have done that on one more than one occasion – will know just how complicated the product can seem.
It’s one of the things that makes the service that specialist health insurance brokers provide valued so highly by clients. That, of course, plus the sensitivity when dealing with clients’ medical conditions, an understanding of how the health service works, an expertise in broader financial planning…
The list goes on. So it’s understandable why some specialist brokers are sceptical when IFAs try to sell PMI. The word “dabble” is often murmured, sometimes accompanied by a raised eyebrow.
But that sentiment appears to be changing. Perhaps it’s an understanding that the more people that are brought into the PMI market, the better it is for everyone. Perhaps it’s a growing confidence among specialists about the value of their own proposition. Or perhaps certain elements of the old guard have given way to a broader minded breed of broker.
Of course, these are just theories. There’s the inevitable danger of an IFA recommending a certain PMI contract to a client without understanding the full complexities of medical insurance underwriting. What happens when that client then makes an unsuccessful claim? An unhappy client decides they’ll steer clear of PMI from now on and, for good measure, tell colleagues, family and friends about how useless medical insurance is.
That is why it will be interesting to see just how Pru gets on with its latest efforts to encourage IFAs to sell more PMI (page 14). While the new Health Optimiser concept is part of a broader protection contract, Pru has clearly decided that a definite PMI push into the IFA market is called for.
Specialist brokers that Health Insurance has spoken to are largely in favour of such initiatives, it seems. Rather than being narrow-mindedly protective of their own territory, they appear to believe that the bigger the PMI cake, the better for everyone.
It’s a more open minded approach than specialist brokers are often credited with taking. Too often, specialists are accused of being a closed shop, focused only on maintaining their own businesses.
Let’s hope, then, that more providers follow PruProtect’s lead and try to get more IFAs excited about PMI. At best, the PMI market will attract more virgin business, risk will be shared, price will fall and the market will grow. At the very worst, specialists might get a call from IFA colleagues keen to find out more about PMI – and that can be no bad thing.