Healthcare cash plans recorded a 74% increase in claim frequency in the first half of 2022 when compared to the second half of 2021, according to Financial Conduct Authority (FCA) value measures data.
The FCA published its latest data on a range of general insurance products which also found an increase in claims frequency in the dental insurance and mortgage payment protection insurance product categories on the previous six months.
The data for H1 2022 revealed healthcare cash plans claims frequency of 202.17%, an acceptance rate of 92.91%, an average claims pay out of £62.71, and complaints as a percentage of claims of 0.10%.
The product also had the highest percentage of premiums paid out in claims of all the 34 products analysed – 66.83%.
In comparison, in H2 2021 cash plans had a claims frequency of 116.52%, an acceptance rate of 94.10%, an average claims pay out of £61.20, and claim complaints as a percentage of claims of 0.09%, .
A similar trend was indicated for dental insurance, with claims frequency more than doubling on the previous six months.
The data indicated claims frequency of 6.63%, an acceptance rate of 94.72%, average claims pay out of £121.79, and claim complaints as a percentage of claims of 1.76%. It also had one of the higher percentage of premiums paid out in claims at 42.33%.
The H2 2021 data revealed a dental insurance claims frequency of 2.95%, an acceptance rate of 93.59%, average claims pay out of £118.56, and claim complaints as a percentage of claims 0.82%.
There was also an increase in claims frequency for mortgage payment protection insurance.
Here the H1 2022 data pointed to claims frequency of 2.47%, an acceptance rate of 92.24%, average claims pay out of £3,833.82 and a claim complaints as a percentage of claims rate of 6.97%
The data for the previous six months for this product category indicated claims frequency of 1.44%, an acceptance rate of 91.68%, an average claims pay out of £3,888.97 and claim complaints as a percentage of claims at 6.74%.
Individual company performance
In terms of individual companies among healthcare cash plan providers, Health Shield posted the highest claims frequency of 570-575%.
Among dental insurance providers, Axa Health, Simplyhealth, Unum and Westfield all posted a claims acceptance rate of 95% or above.
Unum posted the highest claims frequency of 215-220%, while Simplyhealth had the lowest 0-5%.
All providers in this category also posted claims complaints as a percentage of claims of under 5% bar Simplyhealth (5 tp 10%) and all posted an average claims payout of under £500.
Turning to mortgage payment protection insurance, Amtrust, Arch Insurance, Covea, Lloyds Bank GI, Pinnacle, St Andrew’s Insurance and UK Insurance posted a claims acceptance rate, of 90% or below. All providers were at 0-5% on claims frequency.
In terms of complaints as a percentage of claims, all providers were at 5-10% or below bar Amtrust, Canopius and Pinncale.
Arch Insurance posted the highest average value claims payout of between £208,000 and £208,500. The lowest was UK Insurance with between £1,500 and £2,000.
