Medical insurers warned of complaints surge

Medical insurance companies have been warned of a rise in complaints as the Competition Commission investigation into private healthcare continues.

The largest number concerned Bupa, which accounts for almost half the insurance industry and saw complaints to the FSA rise by 50% to 12,165 in the past two years, the Competition Commission said.

Complaints about Aviva rose by 87% to 3,544, while Prudential complaints rose 36% to 1,878.

In total, the FSA received 20,316 complaints about health insurarers last year - a 38% jump on two years ago. Complaints included unexpected bills for “excess” payments, poor claims handling and a limited choice of consultants.

Paul Clark, chief executive of complaints and feedback firm Charter UK said medical insurers needed to take better care to meet customers’ expectations to avoid becoming “entangled in a new mis-selling crisis.”

“Bupa believes this recent spike in complaints may be the result of consumers becoming more willing to challenge insurers after the PPI mis-selling scandal in the banking sector, but that still doesn’t explain where – and why – things are going wrong within the business itself.

“Most of these complaints are actually the result of a failure to meet customers’ expectations. This could be masking a larger problem, however, if it means that patients are purchasing products that they don’t fully understand, either as the result of mis-selling or because of inadequate or confusing documentation.”

“The real problem could be either of these things – or both – but it is impossible to know without first determining the root cause.  Either way, a trend is clearly developing here and medical insurers need to take action now in order to make sure that customers know exactly what they’re buying. Otherwise, these insurers risk becoming entangled in a new mis-selling crisis.”