Medical insurance holds up despite economic difficulties

However good or bad the economic weather, private medical insurance (PMI) tends to remain relatively unaffected.

It appears that this is the case even with the present storm that is affecting us all. The market gurus, Laing & Buisson, report that numbers insured in 2007 rose by 2.4% following a small decline in the previous year. This confirms the pattern of the last 10 years whereby, despite ups and downs from year to year, the percentage of the population covered by medical insurance or medical trusts has stayed steady at around 12%. Furthermore, 2008 seems to be turning out well for medical insurers, with both Bupa and Standard Life recently reporting good first half results.

Within this overall static market there has been a steady decline in individual purchase of health insurance and an increase in company-paid. This trend continued in 2007 with individual policies reducing by 0.8% despite the overall growth.

The decline in self-purchase medical insurance has been due to spiralling costs in the most price-sensitive sector of the market. Demand for company-paid PMI may, ironically, owe something to the problems that our present economic woes are causing pension funds. A recent survey, admittedly by Bupa, reports that 49% of employees nominated pensions as the most desirable benefit, a fall of 6% compared to last year; PMI had risen to 40%.

THE INFORMATION CONTAINED IN THIS DOCUMENT IS OF A GENERAL NATURE ONLY AND SHOULD NOT BE RELIED UPON AS ADVICE IN ANY SPECIFIC SITUATION

For further information, please telephone your usual contact at Buck Consultants (Healthcare):

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