Table of Contents
Introduction and Abbreviations
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- Report methodology
- Definitions
- Global information and research
- Consumer research
- ACORN
- Abbreviations
Executive Summary
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- Discontentment with the NHS continues
- Government investment will take time to have an effect
- 11.5% of the population have PMI cover
- Average household spend on PMI is around £600
- Competition from other products hits PMI profits
- Greater flexibility through menu-based policies
- BUPA and AXA PPP healthcare dominate the PMI market
- Distribution trend continues
- 17% of respondents have PMI cover
- PMI most popular among the wealthy
- Support for the NHS prevails
Market Factors
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- An ageing population
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- UK population trends, by age group, 2003-07
- PMI and the NHS
- Government injects more cash into NHS
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- Central government NHS expenditure and as a percentage of GDP, at current prices, 1994/95-2002/03
- NHS developments and public-private partnerships
- Waiting lists
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- Total number of people awaiting admission at NHS trusts, in England (hospital based), March 1993 to March 2003
- Shorter delays for waiting patients
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- NHS waiting lists, by number of months, in England (hospital based), March 2002-May 2003
- The heart of the problem
- Europe-wide recruitment problem
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- Number of practising physicians and acute care beds per 1,000 population – UK versus five European countries, 2001
- Stable economy encourages continued PMI investment
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- Annual net rates of return of private non-financial companies, 1993-2002
- High employment strengthening the market
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- Number of self-employed workers in the UK, 1998-2007
- Bank of England cuts interest rates
- Regulation could drive up cost of premiums
Market Size
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- One in ten have PMI cover
- PMI subscriptions up by 16% since 1998
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- PMI subscriptions and the number of people covered 1998-2003
- Corporate sector driving PMI sales
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- PMI subscriptions, by company and individual purchase, 1998-2003
- Company PMI accounts for 70% of all subscriptions
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- Company to personal ratio (number of subscriptions), 1998-2003
- Individual PMI in need of intensive care
- Company PMI in rude health
- Premium income approaches £3 billion in 2003
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- PMI gross earned premiums and average premium per person covered, 1998-2003
- Costly individual plans reap dividends
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- Gross earned premiums by sector – company versus individual, 1998-2003
- Household expenditure on healthcare dips slightly
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- Average annual household expenditure on medical insurance and product penetration, 1992-2001-02
- The Scottish and manual workers reject PMI
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- Age, regional and occupational profile of expenditure on and penetration of medical insurance, 2001-02
Claims Management
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- Containment of claims beginning to reap benefits for providers
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- PMI claims incurred versus gross premiums, 1998-2002
- Rising claims incurred hints at need for PMI development
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- Percentage annual change in gross premiums and claims incurred, 1998-2002
- Claim containment strategies may result in higher profits
Competition Products
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- Healthcare cash plans
- Market for cash plans stagnates
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- Healthcare cash plan market, by number of subscribers, 1998-2003
- Market leader targets corporate PMI customers
- Self-pay plans
- Popular despite op cost shock
- Critical illness and income protection schemes
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- Critical illness cover – new sales, 1993-2002
- Income protection – new sales, 1993-2002
- Employee assistance programmes
Product Development
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- Cost-effective plans
- ‘Pick and mix’ plans
- High excess offers greater flexibility
- Targeting expatriates
Key Players
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- BUPA and AXA PPP healthcare continue to dominate the market
- PMI sector in state of flux
- PMI market share heavily consolidated
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- Estimated market share of PMI providers, by premium income 2002
- Company profiles
- BUPA
- AXA PPP healthcare
- Norwich Union Healthcare
- Standard Life Healthcare
- R&SA (FirstAssist)
- Western Provident Association
- CIGNA Healthcare
- Bristol Contributory Welfare Association
Distribution
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- Direct sales dominate the distribution of individual policies
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- Distribution of individual PMI policies by sales sector, 2001-02
- Intermediaries account for a third of corporate PMI policies
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- Distribution of corporate PMI policies by sales sector, 2001-02
- Impact of the Internet
Advertising and Promotion
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- PMI adspend on the rise
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- Top ten advertisers of private health products, June 2002-May 2003
- TV and direct mail account for two-thirds of adspend
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- Distribution of total advertising expenditure on private healthcare products, by main outlet type, June 2002 to May 2003
The Consumer
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- PMI outperforms other health-related schemes
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- Ownership of PMI and other selected general insurance products, by gender, April 2003
- Potential for PMI growth exists
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- Trends in ownership of PMI and other selected general insurance products, May 2001 to April 2003
- Youth market untapped
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- PMI ownership, by gender, age and socio-economic group, April 2003
- Single people far less likely to have PMI
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- PMI ownership, by marital status, lifestage and Special Groups, April 2003
- PMI most prevalent among the wealthy
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- PMI ownership, by working status, income, household size and tenure, April 2003
- Private medical insurance more popular in the South
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- PMI ownership, by region, newspaper readership, new technology usage and ACORN categories, April 2003
- Rising faith in the NHS and high costs of PMI affect purchases
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- agreement/disagreement with three statements on PMI/NHS, April 2003
- Retired least likely to consider PMI
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- agreement with three statements on PMI/NHS, by demograghic sub-group, April 2003
- The high cost of an individual premium is a major deterrent
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- agreement/disagreement with three statements on PMI, April 2003
- Ignorance of PMI is a stumbling block
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- Agreement/disagreement with statements on the advantages/disadvantages of PMI, by gender, April 2003
- Ex-subscribers could return to the fold
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- Level of agreement amongst total sample and those with PMI, April 2003
- Waiting lists key issue for those considering PMI
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- Level of agreement amongst total sample, by stance on PMI and the NHS, April 2003
- PMI customers, potential buyers and NHS die-hards
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- Profile of PMI typologies, by demographic sub-group, April 2003.
- C1s and pre-family consumers identified as potential buyers
- Elderly and less wealthy put trust in the NHS
The Future
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- Steady economy should prompt further growth of PMI
- NHS recovery could affect the individual PMI sector
- Claims must be reduced
- Individual PMI sector needs a boost
- Mintel research finds young most likely to consider PMI
- Targeting the self-employed and expatriates offers potential for growth
- Helplines and after-sales services key to PMI progress
- Company PMI could become compulsory
Forecast
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- Forecast of gross premiums earned, by sector, 2003-07
- Forecast of PMI subscriptions, by company and individual purchase, 2003-07
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