BUPA could lose a substantial part of Cornhill's £10 million private medical book despite offering, last month, to renew the policies without further underwriting.

Stoke-on-Trent intermediary Health Care Options, which has about £1m of cover currently underwritten by Cornhill, doubts that BUPA has the policies to satisfy its small company clients.

Managing director Paul Sutton said many of his corporate clients would want cover comparable to Cornhill's Excel policies.

He said BUPA's closest policy equivalents, Premier Cover and Network, have financial limits that could prove a stumbling block. BUPA policyholders are currently restricted to £800 of cover for out-patient care which will be increased to £1,000 from January.

"From our past experience, we know that our clients will be more interested in the terms and conditions of policies and the handling of claims, irrespective of commissions," said Sutton.

"Cornhill provided first class products and service and it is sad it has pulled out of the health market.

"We are not ruling out BUPA, but we are not ruling out any other health provider either."

Sutton added that he has still not been contacted by BUPA.

"It has not advised me what products it (BUPA) will be offering," he said. "And it has not told me what the prices will be." Under the deal, Cornhill will guarantee continued cover for all existing healthcare customers until the expiry of their existing policies.

Cornhill's customers will then be invited to renew their medical insurance with BUPA on a no-further-underwriting basis.

BUPA spokeswoman Ann Marie Cooklin said it was issuing information to brokers about the deal within the next few days.

She added that BUPA had not made any payment to Cornhill for the deal.

Sutton said Cornhill's decision has been badly-timed because December is a very heavy month for policy renewals.

A BUPA manager is in situ at Cornhill to monitor the book until March 2000.