Table of Contents
Introduction
-
- Market definitions
- Abbreviations
Executive Summary
-
- The market
- Market size and forecast
-
- Figure 1: Forecast for total PMI gross earned premiums (GEP), 2006-16
- Figure 2: Forecast for HCP contribution income earned, 2006-16
- Channels to market
- Market factors
- NHS spending under pressure as government tackles budget deficit
- Stuttering economic recovery remains a challenge
- Complaints to the FOS about PMI fell in 2010/11
- Government rules out tax break on PMI
- Claims as a percentage of premiums have fallen
- Companies, brands and innovation
- The top five providers sold 91% of new PMI policies in 2010
-
- Figure 3: PMI provider market shares, by income, 2010
- Simplyhealth dominates the HCP sector with 45% market share
-
- Figure 4: HCP provider market shares, by income, 2010
- Brand promotion
- Who’s innovating
- The consumer
- Product ownership levels
-
- Figure 5: Health insurance ownership, June 2011
- Consumers and the NHS
-
- Figure 6: Agreement with the statement ‘On the whole, the NHS does a really good job’, June 2011
- Attitudes towards health and private care
-
- Figure 7: Attitudes towards health and healthcare, June 2011
- What we think
Issues in the Market
-
- What does NHS uncertainty mean for the PMI market?
- How are insurers tackling rising claims?
- Can providers improve their image and gain consumer trust?
- Are distribution channels changing in the health insurance sector?
- How can PMI and HCP providers increase ownership levels?
Future Opportunities
-
- Building a moral brand
- Private health insurance as part of a ‘daily’ routine
Internal Market Environment
-
- Key points
- NHS spending increased by 1% between 2009/10 and 2010/11
-
- Figure 8: Total public spending on the NHS, 2003/04-2014/15
- PMI claims costs as a percentage of GEPs fell in 2010
-
- Figure 9: Value of total PMI claims and as a proportion of GEP, 2002-10
- Average PMI premiums increase in personal and corporate sectors
-
- Figure 10: Average PMI premiums, by corporate and personal sectors, 2002-10
- PMI providers have been trying to manage claim costs
- HCP claims drop in 2010
-
- Figure 11: Amount of HCP cash benefits paid and benefits paid as a percentage of contribution income earned, 2002-10
Broader Market Environment
-
- Key points
- Difficult economic climate has increased consumer caution
-
- Figure 12: GDP quarterly percentage change, Q1 2008-Q2 2011
- A drop in the number of employers offering PMI as a core benefit
-
- Figure 13: Proportion on employers offering particular benefits as core, May 2011
- Tax relief on PMI rejected by the government
- Growing number of ABs could help grow policy sales
-
- Figure 14: Forecast adult population trends, by socio-economic group, 2006-16
- Complaints about PMI drop by 22 percentage points
Competitive Context
-
- Key points
- The majority of adults are supportive of the NHS
- Uncertainty about NHS could increase appeal of private care
- Access to private care likely to increase under Government plans
- NHS will have to fund care abroad
- Self-insured medical schemes increased in 2010
-
- Figure 15: Number of subscribers and people covered by healthcare trust schemes, 2002-10
- 15% of consumers have money set aside for medical/dental treatment
SWOT Analysis
-
-
- Figure 16: SWOT analysis of the health insurance market, 2011
-
Who’s Innovating?
-
- Key points
- Perfect Cash Plan includes income protection
- Affordable cash plans for businesses
- App availability and usage likely to increase
- Private medical insurance for expats
- Commission models designed to tackle churn in SME healthcare market
- Bupa announces a reversal on cancer limits for corporate policies
Market Size and Forecast
-
- Key points
- Tough market conditions lead to a further contraction in PMI subscribers…
-
- Figure 17: Number of subscribers and people covered by PMI, by sector, 2003-11
- …while corporate and personal PMI premiums increased in 2010
-
- Figure 18: Gross earned premiums (GEP) for PMI, by sector, 2002-11
- HCP market declines further during 2010
-
- Figure 19: Number of healthcare cash plan subscribers, people covered and contribution income earned, 2006-11
- Uncertain economic recovery has made in challenging to sell PMI and HCPs in 2011
- Market forecast
-
- Figure 20: Forecast for total PMI gross earned premiums (GEP), 2006-16
- Figure 21: Forecast for HCP contribution income earned, 2006-16
- Forecast methodology
Market Share
-
- Key points
- Bupa remains the number one PMI provider…
-
- Figure 22: PMI provider market shares, by income, 2010
- Figure 23: Subscription income of the top ten PMI providers, 2006-10
- …while Simplyhealth is the number one provider of HCPs
-
- Figure 24: HCP market share. by income, 2006-10
Companies and Products
-
- Aviva
-
- Figure 25: Financial performance of Aviva Plc (Health insurance business), 2009 and 2010
- AXA PPP healthcare
- Bupa
- PruHealth
- Simplyhealth
-
- Figure 26: Financial performance of Simplyhealth Group, 2009 and 2010
Brand Communication and Promotion
-
- Key points
- PMI adspend relatively stable despite tough market conditions
-
- Figure 27: Private medical insurance adspend, 2008/09- 2010/11*
- NHS uncertainty could present an opportunity for advertisers
- Bupa remains the number one advertiser of PMI
-
- Figure 28: Top 20 advertisers of PMI, by expenditure, 2008/09-2010/11
- Direct mail accounts for more than 50% of PMI adspend
-
- Figure 29: Private medical insurance adspend, by media type, 2008/09-2010/11
Channels to Market
-
- Key points
- Intermediated distribution dominates the corporate market…
-
- Figure 30: Proportional distribution of PMI sales, by sales channel, 2006-10
- …while direct channels account for two thirds of personal PMI
- Internet is a good source of information but sales are relatively small
- HCPs are predominantly sold through direct channels
-
- Figure 31: Proportional distribution of HCP sales, by sales channel, 2008-10
Product Ownership Levels
-
- Key points
- Around 27% of the UK population have some form of health insurance
-
- Figure 32: Health insurance ownership, June 2011
- PMI ownership is higher among men, while HCP levels are even
- Self-insurance is most popular among the over-65s…
-
- Figure 33: Health insurance ownership, by gender and age, June 2011
- …while health insurance ownership is highest among 45-54-year-olds
-
- Figure 34: PMI and health cash plan ownership, by age, June 2011
- Health insurance ownership increases with affluence
-
- Figure 35: Health insurance ownership, by socio-economic group and household income, June 2011
- Some multiple product ownership exists in the market
-
- Figure 36: Cross-analysis of health insurance product ownership, June 2011
Consumers and the NHS
-
- Key points
- The majority of people feel that the NHS does a really good job
-
- Figure 37: Agreement with the statement ‘On the whole, the NHS does a really good job’, June 2011
- Elderly are the most supportive about NHS services
-
- Figure 38: Agreement with the statement ‘On the whole, the NHS does a really good job’, by gender, age and lifestage, June 2011
- Consumer support for the NHS and health insurance ownership are not mutually exclusive
- Over 50% of adults feel that NHS services will suffer
-
- Figure 39: Agreement with the statement ‘I think that the proposed reforms to the NHS will reduce the standard of care available’, June 2011
- Agreement is skewed towards 45-54-year-olds
Attitudes Towards Health and Private Care
-
- Key points
- Over 50% of adults are unaware about health insurance costs
-
- Figure 40: Attitudes towards health and healthcare, June 2011
- Awareness and engagement lacking even among those with insurance
-
- Figure 41: Cross-analysis of health insurance ownership and attitudes towards health and healthcare, June 2011
- Higher earners are more critical of NHS waiting lists
-
- Figure 42: Attitudes towards health and private care, by annual household income, June 2011
- A fifth of consumers do not trust providers to treat customers fairly
-
- Figure 43: Agreement with the statement ‘In general, I trust private health providers to treat their customers fairly’, June 2011
- Around 7% of consumers have looked into getting some health cover
Targeting Opportunities
-
- Key pooints
- Key target groups
-
- Figure 44: Key target groups, June 2011
- Figure 45: Attitudes towards health and healthcare, by target groups, June 2011
- Hygiene worriers
- Waiting list worriers
- The split majority
Appendix – Market Size and Forecast
-
-
- Figure 46: Forecast for PMI gross earned premiums, by sector, 2011-16
- Figure 47: Forecast for corporate PMI gross earned premiums, 2006-16
- Figure 48: Forecast for personal PMI gross earned premiums, 2006-16
- Figure 49: Forecast for the number of PMI subscribers, 2011-16
-
- Figure 50: Forecast for total number of PMI subscribers, 2006-16
- Figure 51: Forecast for total number of corporate PMI subscribers, 2006-16
- Figure 52: Forecast for total number of personal PMI subscribers, 2006-16
- Figure 53: Forecast for the number of people covered by PMI, 2011-16
-
- Figure 54: Forecast for total number of people covered by PMI, 2006-16
- Figure 55: Forecast for total number of people covered by corporate PMI, 2006-16
- Figure 56: Forecast for total number of people covered by personal PMI, 2006-16
- Figure 57: Forecast for the number of health cash plan subscribers, people covered and contribution income earned, 2011-16
-
- Figure 58: Forecast for the number of HCP contributors, 2006-16
- Figure 59: Forecast for the number of people covered by a HCP, 2006-16
-
Appendix – Product Ownership Levels
-
-
- Figure 60: Health insurance ownership, by demographics, June 2011
- Figure 61: Health insurance ownership, by demographics, June 2011
-
Appendix – Consumers and the NHS
-
-
- Figure 62: Agreement with the statement ‘On the whole, the NHS does a really good job’, by demographics, June 2011
-
- Figure 63: Agreement with the statementI’ think that the proposed reforms to the NHS will reduce the standard of care available’, by demographics, June 2011
-
Appendix – Attitudes Towards Health and Private Care
-
-
- Figure 64: Agreement with the statement ‘In general, I trust private health providers to treat their customers fairly’, by demographics, June 2011
- Figure 65: Attitudes towards health and healthcare, by demographics, June 2011
-
- Figure 66: Attitudes towards health and healthcare, by demographics, June 2011
-
Appendix – Targeting Opportunities
-
-
- Figure 67: Target groups, by demographics, June 2011
-
Back to top