Many reports of the launch of Tesco into individual private medical insurance suggest this is the first time a supermarket has tried this type of insurance
The truth is that both ASDA and Sainsbury's , both of whom offer a wide range of insurance products, failed dismally in attempts to sell health cash and budget private medical insurance.
A long list of retailers also tried and failed. Boots launched into health insurance in a big way a few years ago, and although it still offers insurance, you usually have to hunt around the store to find any leaflets.Boots has shied away from private medical covers.
If anyone can sell private medical insurance, Tesco probably can, but it is not going to be easy. Tesco Personal Finance now has five million customers and 20 products. Most are sold on offering a low price.
It is one thing to sell motor insurance , where vicious competition means that price is almost everything. It is another to sell an expensive discretionary purchase such as private medical cover.
Those providers that successfully sell individual private medical insurance have turned away from the old style one-size-fits-all insurance, to a range of products and products with a range of choices to meet individual needs and wishes.Successful health insurers have recognised the need to help people become more healthy with discounts and incentives.Tesco have been banging on about ' healthy eating ' , but we will have to wait and see what healthy lifestyle incentives , if any, are offered.
Tesco may tempt people who have never though of private medical insurance to consider the advantages.Or it may just focus and price and steal existing customers from other providers.
Supermarkets have a reputation for pushing suppliers very hard on price.Several insurers who offered products via supermarkets, no longer do so as they are not prepared to cut prices below a level where they can make a profit.Where low price is the key element, if an insurer is pushed too hard by a supermarket or bank offering a branded product , what tends to happen is that the insurer takes a very hard line on what it will pay in claims.
While millions of people use supermarkets each week, there is a turning of the tide back to using local shops, sourcing food locally, as well as buying ethical and organic goods .This individualism is reflected in the wide variety of individual private medical insurances on offer.This ranges from shared risk to hospital treatment plans, budget plans to choice of cover, special polices for those over 50 and much more
