Insurance cover prices should be based on level of previous claims

The cost of insurance cover for those looking for private medical cover can vary based on a number of factors, and one of the factors is whether the policyholder has made any previous claims on the insurance. In many cases the cost of cover can soar whether the claim was a large one of just a small one, with many insurance firms only offering discounts for those that have not made a claim at all.

One industry official from the insurance sector has expressed concern over the number of insurance firms that offer a no claims discount on private medical insurance cover. Fiona Harris from Bupa believes that this is not the way to price private medical insurance cover because it puts people off from making smaller claims, which she said is wrong. However, consumer campaign group, Which?, stated recently that private medical insurance prices based on no claims discounts can be classed as fair providing they are transparent and fair for the consumer.

There are many major insurance firms that operate a no claims discount but some industry officials believe that this could be classed as discrimination. Bupa believes that the cost of cover should be based on the level of the claim that has been made, with those that have made smaller claims facing a smaller premium hike than those that have made larger claims.

Fiona Harris from Bupa stated: ‘What we don’t want to do is dissuade people from finding out what is wrong with them. Often it is the basis for small claims that are the important ones in terms of diagnosis. Cover based on a no-claim discount basis deters people from making these small claims and that’s not good.’