Private medical insurance (PMI) and protection plans are notoriously difficult for consumers to understand. According to a recent survey critical illness cover is one of the least understood protection plans available.
Defaqto, a financial services industry analyst, has developed a star ranking system to rate 40 types of financial product. The system uses a scale of one to five stars based on policy details and the key features of the product. For PMI, 50 features are assessed, including 14 core criteria. The core criteria include cancer care and outpatient and inpatient treatments. To achieve a 5-star rating policies must include the 14 core elements at some level.
The Association of Medical Insurance Intermediaries (AMII) has criticised the rating system. It claims that the “simple” star ratings are “highly dangerous and not in the best interests of consumers.”
Defaqto defended their classifications telling Health Insurance a “stringent and robust methodology” is used to rank PMIs.
The AMII and Defaqto are still in communication regarding the ranking system. Defaqto aims to address the concerns of the AMII while ensuring that their ratings remain “ relevant and useful to advisors” and their clients.
We at Expat Health believe that, while PMI should always be bought under the supervision of a specialist, anything that makes choosing a provider simpler can only be a good thing.