‘Low-cost’ medical plan aims at NHS patients

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HSA, the mutual health insurer which specialises in cash plans, will launch a new low-cost private medical insurance (PMI) policy this week aimed at people who regard such policies as out of their price range.

HSA, which provides cash plans to 2m people, says it wants to attract an increasing number of people who rely on, but are dissatisfied with, the National Health Service. In a move designed to challenge the usual high premiums of PMI policies, HSA says it will charge the same to everyone, regardless of claims history, age, gender or bad habits, such as smoking, with premiums starting at just £11 per month.

HSA, which sponsors Blackburn Rovers in the Barclays Premiership, was set up by a group of medical insurance long-timers who have taken an almost evangelical stance on behalf of the underdog. They say they had become disillusioned with the complex way PMI products are sold by mainstream providers, and the high levels of profits generated by them. HSA claims it is a low-profit organisation.

Its chief, Des Benjamin, styles himself as a “consumer champion”, dedicated to restoring public confidence in the insurance market. Spokesman Jeremy Chadwick said: “Many of the senior management have rejected the plc world as exploitative of both customers and staff. Mutuality allows businesses to grow successfully if run efficiently and prudently.

“With no shareholders and dividends, there is more money to pay for products and services - in our case, healthcare.” Julian Evans, HSA Personal Medical Plan spokesman, said the group hoped to bring “simple, honest value to a complicated and stagnant market”.

HSA’s new policy is a “surgery-only” scheme which aims to complement the NHS. It will charge no excesses for claims, nor exclude pre-existing conditions. It will also provide a service which will make appointments for policyholders with consultants.

Independent medical insurance adviser George Connelly of Health Care Matters, based in Dorset, said: “This is an interesting, pioneering product. I have no doubt it will encourage more people to take up PMI, and probably encourage many people to trade down to it.” However, he added: “As with many low-cost schemes, people must take note that they may not be getting many things they get with a higher-cost policy.”

He said the small print allows HSA to cancel policies if claims become too high, and to give only 30 days’ notice of premium rises - both unusual caveats in PMI policies.

While pre-existing conditions can be claimed for after two years, people who have been diagnosed with cancer or who have had heart surgery are excluded for those conditions.

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