Dramatically changing demographics of private health insurance (PMI) consumers have meant guided care is increasingly resonating with new customers while a market is opening up for a third way between full-fat insurance and cash plan products.
Participating in a panel debate at Health & Protection’s second annual Health Summit, Rod Jones, head of sales at Active Quote, (pictured right) revealed the vast majority of the firm’s customers were younger, generally in their mid-to-late-30s, and had never bought PMI before.
He also said he thought guided care was “absolutely brilliant” due to its ability to make private medical insurance more accessible for this population.
“We find 80% of customers have never had private medical insurance before,” Jones told delegates.
“Their average age is in their mid-30s or late-30s and actually they get confused if they have to choose their consultant because they don’t know who to choose, they’re not friends with the consultants.
“None of these names mean anything, it’s all about how quickly can they be treated.”
‘Dramatic’ change
Wayne Pontin, non-executive chairman at Infimo, closing out the Summit agreed that this new younger demographic was reflective of a “dramatic” change.
“It used to be 45-plus, a benefit of the high net worth affluent people that would purchase private medical insurance,” Pontin said.
“It’s no longer that,” he continued. “What’s happened since the pandemic is that demographic has changed.
“You’ve got a younger person, you’ve got a person who is more tech savvy, you’ve got a person who wants things done yesterday not tomorrow or today – yesterday.”
Journey to understanding
And according to Jones, this evolution in the market has opened up an opportunity for new products to fit between the historically full-fat private medical insurance and cash plan provision.
“I think the market up until a few years ago was cash plans were one extreme over here and insurance was at the other extreme,” Jones said.
“Actually what we’re seeing is more people thinking there’s a gap in the middle and there’s an opportunity in the middle.
“We have seen some good products and some good innovation.”
He added that the challenge advisers have is how they educate and inform and clarify to the customers about their options.
“Sometimes we put too much choice in front of them because in our channel, we have customers who have never bought it before,” Jones continued.
“You’ve got a half hour conversation on the phone to give them advice when actually too much information, too much choice is really difficult.
“We’ve got to go on a journey together to get customers to understand what they are getting.”