Opening doors

How can cashplans help brokers? Against the backdrop of the ever decreasing personal lines market cashplans seem to be a relatively untapped market, why should brokers be looking to them to replace their dropping books of business?

Cashplans can provide an opportunity to add to a broker's income. They are relatively easy sell due to favourable market conditions and their affordability compared to PMI to a large number of people.

In the corporate market PMI is often limited to senior employees, but cashplans are cost effective and flexible enough for all employees. They are also a door-opener. Brokers can use them as a way to target new clients and then cross-sell other products, providing an easy way for brokers to expand their portfolios. Cashplans offer significant ongoing commission due to their life expectancy - in excess of ten years is commonplace.

Public sector spending on health is set to rise dramatically over the next few years. Is this another threat to sales of cashplans?

The government has shown its commitment to the NHS, but the majority of the money will go into treating serious, life-threatening conditions and reducing waiting lists. These are not areas at which cashplans are aimed. Cashplans cover areas such as dental, optical, physiotherapy and chiropody, and will not see the benefit of government cash .

Any increase in spending on areas of serious illness can only be beneficial for the cashplan market leading to an increase in demand for policies. In fact, cashplans will assist the government by reducing pressures in these healthcare areas.

One selling point for cashplans is that they are more affordable than private medical insurance. But PMI providers are offering new low cost, modular products with more exclusions. Is this another threat to the future of cashplan sales?

PMI providers are not direct competition for healthcare cashplans. By its very nature PMI provides cover for more serious conditions. A lot of people have both PMI and a healthcare cashplan, demonstrating how comfortably they sit together, particularly where the PMI policy has a high excess.

Ultimately, anything that encourages the growth in PMI sales is good for us; it opens people's eyes to healthcare and alerts them to the fact that everyone is having to take more responsibility for their healthcare.

Are companies becoming more interested in proactive ways of keeping their workforce healthy? (improving profitability by reducing health-related absenteeism and improving recruitment and retention.)

This is a key question. Companies are being forced to address issues such as health-related absenteeism and long-term sickness. Last year British business lost in excess of £13bn through health-related absenteeism, including areas such as stress, back pain or even dental problems. HealthSure's policies even include a 24-hour confidential helpline to deal with issues such as stress and counselling. Recruitment and retention is also a key issue. Cashplans are a simple and effective way for companies to provide benefits to all employees.

What are the latest innovations in cashplans?

Cashplans are becoming more highly-developed and advanced in order to address our modern healthcare needs. HealthSure has developed a health-screening product called Futures that helps employees to detect problems at an early stage. The product covers the cost of a health screen every two years, along with payments towards necessary associated treatments, such as specialist consultations, X-rays or scans..

In the past, providers have been guilty of not listening to brokers' requirements. We now offer support services to underpin our products. This includes a `taster' package for companies, which is a low cost way for them to trial cashplans with their employees.

We have also developed marketing and communication resources for brokers to assist in the sale of cashplans.

The FSA is proposing that health products will be classified "high risk" in terms of sales and that brokers will require training before selling them. Will this wipe out a route to market for cashplans?

Cashplans should not be treated the same as PMI. It is a completely different product with far less risk. We have been liaising with the FSA regarding this issue.

It is hard to envisage how this will affect the market at this stage, but we will work closely with our broker partners to ensure that this isn't a problem for them.