Prime Health has scotched rumours that it is pulling out of the long-term care market, although it has confirmed it is undertaking a review and will no longer actively promote the product.
Gillian Gibbons, press officer for Prime Health, said that LTC has been slow to take off, with demand levels significantly lower than predicted. She added: “PMI forms the bulk of our business and remains our core product.”
A Royal Commission is currently examining options for funding LTC for the elderly. The Commission will recommend how the cost for care should be shared between public funds and individuals. The findings are expected to be published within 12 months.
Parent company Standard Life has confirmed that Prime Health will no longer be concentrating on the LTC market, although they denied that the company would be pulling out altogether. Peter Robertson, assistant marketing manager said: “We would rather produce products which clearly fit the needs of potential customers than rush to exploit an apparent gap in the market.” He added that the LTC market is likely to stagnate until the Commission’s report is released.
This move by Prime Health follows similar activity by BUPA and PPP. Both cut their LTC sales teams in 1997 as a result of low take-up rates.
The slow growth in demand has been attributed to a lack of tax incentives. It has also been claimed that IFAs have “insufficient knowledge” of this specialist product to maximise its potential.