Delivering the PMI message

The marriage of health insurance and brokers is far from a union made in heaven. Traditionally the majority of brokers have kept health insurance at arms length believing it is too complex for the commission rates involved.

But Stuart Scullion, the sales and marketing director of health insurer PatientChoice, has a real commitment to the broker/intermediary channel. "Brokers know their clients, have relationships with them, and we can plug into that, build constant relationships and offer them our products – it is a win, win situation," he says, with passion.

This experience of exploiting the fruits of the broker has been with Scullion for many years and proved a key factor in the success of his previous role, as marketing director with Clinicare. When Scullion joined Clinicare 13 years ago, he was the third member of staff and the business was worth around £600,000. By the time he left there were 85 staff and it was doing business in the region of £38m.

If Scullion has as much success in his current role, PatientChoice will be flying high.

Scullion left Clinicare to join PatientChoice in July last year. This came after Clinicare was bought by Groupama and confesses Scullion "wasn't the same company after that – a new and different culture was introduced". And so, Scullion, decided to move on. "I wanted another job, I wanted another challenge and opportunity," he says.

He certainly has that at PatientChoice. The company was formed by Dr Thom Van Every in 2004, to offer a new type of medical insurance cover in the UK, aiming to provide cost effective medical insurance in the corporate, affinity and retail market. It allows the customer to shop around for the most appropriate treatment or to have NHS-funded care and take a cash sum instead.

The aim of the approach is to allow policyholders to save money through lower premiums but at the same time have choice and control of their private healthcare.

And since taking over his role at PatientChoice, Scullion has shifted the business to a dominant broker focus. "Everything was direct when I came, and I changed that. Brokers offer invaluable relationships with individuals and companies, and an opportunity to plug into those who are not covered by any form of PMI." This is part of PatientChoice's sales pitch: to offer PMI at affordable premiums which is pushed to the broker.

Last year it launched a new corporate health insurance product – Priority – which it hopes will also help firms manage absence levels.

Costing just £1 a week, it provides cover for 60 common operations and medical procedures that frequently lead to time off work, such as slipped discs and hernias.

Scullion says: "The idea is to cut back on the expensive premiums people are paying for standard PMI. And on top of the price, the product is attractive because it works for the employer as a sickness absence tool."

His focus on building broker relations has resulted in Scullion driving up and down the country meeting all types of brokers. He is looking to brokers to help him boost the 15,000 policyholders his company holds at the moment to 50,000 by the end of this year.

"We want to work with brokers and intermediaries who know the PMI business to learn what we have on offer and look after their clients," says Scullion.

And he adds: "Our products do open a whole new market for brokers. They exist for how the customer want to use them."

Commissions stand at 10% for initial and renewals on Priority and 50% initial and 10% renewal on the hospital treatment plan.

But it is a difficult job putting the PMI message to the broker. A recent damning Defaqto report showed that brokers and financial advisers are failing to excite consumers about PMI.

Defaqto's IFA Satisfaction Survey indicates that 46% of advisers never recommend PMI policies, and 50% do so infrequently. Hardly a basis to trust brokers with promoting PMI. Worst of all, pet insurance outsells PMI by a factor of five to one.

"It can be difficult, but it is worth the effort," says Scullion. "You end up building lasting relationships that really add value to the business."

But isn't it surprising how few brokers approach PMI? "PMI can be seen as complex, and it is surprising that general brokers don't get more involved in it, but those that do, in my experience, are good at it. And that is what matters from my point of view."

Could the Association of Medical Insurance Intermediaries (AMII) do more to persuade brokers? "They do a good job, but I suppose they could do more," he says.

Shrewdly, Scullion is looking to plug into those brokers with larger company clients with many employees, as his next big push. "This is a vast untapped market, where many employees are not covered by any PMI," he says. Brokers need to take notice. IT