All news
Health insurance providers criticise star ratings
February 22, 2012
A new star rating system for private medical insurance policies has come in for further criticism.
Insurers have defended their private medical insurance products following the launch of a new star rating system.
Defaqto says its scheme is designed to help people distinguish between different financial products.
But insurers believe the rating system may be misleading, with Saga criticising its handling of budget plans, which may be ideal for those who only want a limited number of features.
Head of communications Paul Green told the Herald newspaper: "At the moment their system leaves a budget plan, no matter how good, with just one star and therefore makes no allowance for customer choice.
"It's like comparing a Bentley and a Mini, both of which could be said to be five-star cars in their class, but if they were ranked by Defaqto then a supermini - no matter how super - would always be on the scrapheap."
Charlie MacEwan, a spokesman for health insurer WPA, told the newspaper that he also disagrees with Defaqto's interpretation of some policy features, such as no-claims discounts, hospital networks and six-week waiting times - all of which are deemed to be positive features under the star rating scheme.
He argued: "We think no-claims discounts encourage policyholders not to claim which is playing with their health, while if a policy is linked to a particular network it means policyholders have less choice; and with a six-week wait - well who wants to sit in pain for six weeks?"
The Association of Medical Insurance Intermediaries has also voiced concerns about the scheme, saying it is "bemused" by the ratings.
Private Health Insurance News
