Table of Contents
Introduction
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- Report scope
- Market definition
- Abbreviations
Executive Summary
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- The market
- Health cash plans expected to enjoy sustained growth in next five years
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- Figure 1: Forecast of value of health cash plan annual premiums, 2009-19
- Market factors
- The economy is improving but consumers are still cautious spenders
- The price difference between HCPs and PMI remains stark
- Low claims costs have kept providers’ margins high despite the downturn
- Companies, products and innovations
- Simplyhealth is the dominant player in the HCP market
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- Figure 2: Top five HCP providers, by income, 2013
- Brand promotion
- The consumer
- A fifth have health insurance, but just 6% have an HCP
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- Figure 3: Health insurance ownership, August 2014
- A third of cash plan or dental/optical plan customers researched their plan online
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- Figure 4: Sources of research for health cash plan and/or dental or optical plan policies, August 2014
- Perceived cost is the biggest barrier to HCP ownership
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- Figure 5: Barriers to ownership of health cash plans, August 2014
- Dental treatment is the most popular HCP benefit
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- Figure 6: Desired features of health cash plans, August 2014
- Experience of medical services
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- Figure 7: Experience of routine medical services in the last 2 years, August 2014
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- Figure 8: Personal and immediate family’s experience of non-routine medical services, August 2014
- What we think
Issues and Insights
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- Insurers have got prices right but are failing to get the message across
- The facts
- The implications
- Covering prescriptions can help define HCPs position in the market
- The facts
- The implications
Trend Application
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- Smartphone apps can improve usability and increase engagement
- Make plans more relevant by offering tailored benefit packages
- Personal expert opinion still beats online guidance
Market Drivers
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- Key points
- Slump in company-paid premiums is stifling growth…
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- Figure 9: Average annual premiums for HCPs, 2004-2013
- …but low cost of HCPs is favourable in face of rising PMI premiums
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- Figure 10: Average annual premiums for PMI, 2003-13
- Costs of NHS services is a concern for many
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- Figure 11: Cost of NHS prescriptions and dental treatment in England, 2010-14
- Sustained improvement in employment figures…
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- Figure 12: UK employment rate for people aged 16-64, January 2008 – July 2014
- Figure 13: Number of people aged 16+ in full-time employment, August 2013 – July 2014
- Cost of claims remains low compared to historic average…
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- Figure 14: Total benefits paid to HCP policyholders, 2007-13
- …so margins have stayed high
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- Figure 15: Gross percentage margin of HCPs, 2007-13
SWOT Analysis
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- Figure 16: SWOT analysis of the health cash plan market, September 2014
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Who’s Innovating?
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- Key points
- Bupa now accepts online claims
- Westfield broadens its health club discounts
- Health Shield adds home assistance benefit
- First Assist (Cigna Insurance) launches surgery cash plan
Market Size and Forecast
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- Key points
- Modest growth in HCP premiums
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- Figure 17: Volume of HCP contributors and people covered, and value of HCP premiums, 2007-14
- Company contributions continue to rise
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- Figure 18: HCP market segmentation, individual contributors vs corporate contributors, 2007-13
- Market forecast
- Volume of health cash plans expected to grow by 8% by 2019…
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- Figure 19: Forecast of volume of health cash plans in force, 2009-19
- Figure 20: Forecast of volume of health cash plans in force, 2009-2019
- …and the value of premiums is expected to rise by 11%
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- Figure 21: Forecast of value of health cash plan annual premiums, 2009-19
- Figure 22: Forecast of value of health cash plan annual premiums, 2009-19
- Forecast methodology
- Fan chart explanation
Market Share
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- Key points
- Simplyhealth dominates the health cash plan market
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- Figure 23: Health cash plan market share, by income, 2013
- Little change in the last five years
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- Figure 24: Health cash plan market share, by income, 2009-13
Companies and Products
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- Simplyhealth
- Company description
- Product range
- Financial performance
- Recent activity
- Westfield Health
- Company description
- Product range
- Financial performance
- Recent activity
- BHSF Group
- Company description
- Product range
- Financial performance
- Recent activity
- Health Shield
- Company description
- Product range
- Financial performance
- Recent activity
- HSF Health Plan
- Company description
- Product range
- Financial performance
- Recent activity
- Medicash
- Company description
- Product range
- Financial performance
- Recent activity
Brand Communication and Promotion
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- Key points
- Industry adspend still below 2012 levels
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- Figure 25: Total adspend by health insurance providers, 2012-14
- AXA is the biggest-spending advertiser in health insurance
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- Figure 26: Top ten advertisers in health insurance, 2012-13
- Benenden trials personalised television advertising
Channels to Market
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- Key points
- Most policies are non-intermediated…
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- Figure 27: Proportion of health cash plan sales, by sales channel, 2009-13
- …but adviser activity is growing in corporate business
Health Insurance Ownership
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- Key points
- Over a fifth have health insurance
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- Figure 28: Health insurance ownership, August 2014
- Two thirds have no cover or savings for medical expenses
- Lower-earners are least likely to have an HCP
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- Figure 29: Ownership of health cash plans vs those with no health provisions, by household income, August 2014
- Parents of young children are most likely to have an HCP
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- Figure 30: Ownership of health cash plans, by age of dependent children, August 2014
Health Cash Plan Research
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- Key points
- A third of cash plan policyholders researched online
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- Figure 31: Sources of research for health cash plan and/or dental or optical plan policies, August 2014
- Employers are more prominent in HCP research than other policies
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- Figure 32: Sources of research for health cash plan and/or dental or optical plan policies, by health insurance ownership, August 2014
- Men are more engaged in researching plans
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- Figure 33: Sources of research for health cash plan and/or dental or optical plan policies, males vs females, August 2014
Barriers to Ownership
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- Key points
- Cost is the biggest barrier to HCP ownership
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- Figure 34: Barriers to ownership of health cash plans, August 2014
- Those in poor health are most likely to find HCPs too expensive
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- Figure 35: Selected barriers to ownership of HCPs, by description of personal health, August 2014
- Creating a differentiated approach to HCP marketing
- Lack of trust in insurers makes it harder to see value in HCPs
- Increasing awareness among younger consumers could boost sales
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- Figure 36: Awareness and understanding of HCPs, by age, August 2014
Desired Features of Health Cash Plans
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- Key points
- Dental treatment is the top priority
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- Figure 37: Desired features of health cash plans, August 2014
- Features that cater for all?
- Could smaller HCPs cater for the economy market?
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- Figure 38: top five most popular features of HCPs among consumers who can’t afford an HCP, vs all, August 2014
- HCP policyholders are much more engaged in the benefits that they want
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- Figure 39: Desired features of health cash plans, by HCP ownership, August 2014
- Parents of young children are more interested in guidance services
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- Figure 40: Selected desired features of HCPs, by age of respondent’s children living at home, August 2014
Experience of Medical Services
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- Key points
- GPs are the most used medical service
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- Figure 41: Experience of routine medical services in the last 2 years, August 2014
- Use of any service increases ownership and engagement
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- Figure 42: Experience of routine medical services, by health insurance product ownership and desired features of HCPs, August 2014
- Women use routine services more than men
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- Figure 43: Experience of routine medical services in the last 2 years, by gender, August 2014
- Nearly half of all people have stayed overnight in a hospital…
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- Figure 44: Personal experience of non-routine medical services, August 2014
- Figure 45: Family members’ experiences of non-routine medical services, August 2014
- …but non-routine treatment is not a greater trigger for HCP purchases
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- Figure 46: HCP ownership by personal experience of routine and non-routine medical services (five most common of each), August 2014
Appendix – Market Size and Forecast
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- Volume
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- Figure 47: Best- and worst-case forecast of the volume of health cash plans in force, 2014-19
- Value
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- Figure 48: Best- and worst-case forecast of the value of health cash plan annual premiums, 2014-19
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