The demand for private medical insurance (PMI) will not be eroded by the promises made by political parties ahead of the upcoming UK general election.
While the healthcare system is being put at the heart of different manifestos, the current record-high waiting lists suggest that any tangible improvement to the NHS will take far too long to put off UK consumers from purchasing PMI in the foreseeable future.
According to GlobalData’s 2023 UK Insurance Consumer Survey, concerns about NHS waiting times and/or services is the leading reason why consumers take out PMI, as cited by one in four individuals (25.2%). This has not only been the main purchasing trigger over the years, but the proportion has remained stubbornly high since 2019, which was then compounded by the Covid-19 pandemic.
The Conservative Party has pledged to increase NHS spending, open 40 new hospitals by 2030, and improve mental health support.
Meanwhile, the opposition Labour Party intends to cut NHS waiting times by delivering an additional two million appointments annually as well as training more GPs. Even the Green Party has committed to revitalising the healthcare system, setting aside £50bn ($63.5bn) for this purpose.
It is difficult to foresee the dramatic recovery that the political parties are hoping for any time soon. The state of the NHS is in tatters, having succumbed to years of austerity measures imposed by the ruling Conservatives, with economic injections being scant and dispersed.
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By GlobalDataThe Covid-19 pandemic was the tip of the iceberg, further stretching NHS resources and extending waiting lists, which stood at 7.57 million in April 2024 as per NHS England statistics.
An appetite for PMI
While concerns about accessing healthcare services will continue to create appetite for PMI, an overstretched healthcare system could have a negative impact on the quality of healthcare provision, as well as the attitudes and behaviours of staff. This could eventually prompt other patients to consider purchasing PMI.
Hence, investments in the NHS are likely to have little impact on demand for PMI any time soon.
However, private healthcare is becoming more expensive, and insurers have passed on costs to policyholders. Further data from our survey highlights this, with 74.2% of PMI policyholders paying up to £100 a month, compared to 69.7% a year prior. Realistically, instead of improvements to the NHS, the cost-of-living crisis will be the main challenge that lies ahead for insurers.
