The Association of British Insurers (ABI) has given its full support to the General Insurance Standards Council (GISC) consultation on the practice requirements for Private Medical Insurance.  The GISC’s PMI Working Group and the ABI PMI panel helped to formulate the Practice Requirement, which will help consumers distinguish between PMI products.  Both insurers and intermediaries will be subject to the Practice Requirement, which will be incorporated into GISC regulations.  The industry is hopeful that the FSA will take these moves into consideration in their consultation on the regulation of general insurance.

The Practice Requirement includes new measures that will:
· provide details of the information that customers must be provided with prior to commitment to cover or renewal
· include a series of common definitions, which will make it easier for consumers to compare products
· show how insurance products vary, illustrated through user friendly examples

Commenting on the consultation document, Richard Walsh, Head of Health Insurance at the ABI said,
“This consultation process demonstrates how seriously insurers view consumer protection for PMI products. The Practice Requirement will provide clarity and consistency. The common definitions, in particular, will mean that consumers can be confident about the cover they hold and make informed choices on increasing or reducing that cover by comparing products using the user friendly examples. The ABI will also be issuing a new version of the PMI Consumer Guide early in the new year” 

Angela Darling, Head of Policy at GISC, commented,
 “Reports from the Office of Fair Trading have highlighted that PMI products vary greatly in their scope and coverage.  The objective of this new Practice Requirement for GISC members offering PMI is to ensure that individuals receive enough information in a form that they can understand for example in defining particular medical terms.  This will help them to make an informed decision when buying their insurance.”

The GISC consultation will close on 12 February 2003 and subject to responses to the consultation exercise, the Practice Requirement will come into force in June 2003.  It will be reviewed by the end of 2003. The review is important because this is the first time a general insurance product has been regulated by GISC in this way. 

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Notes

Note for Editors

1. Enquiries to: Alan Leaman  020 7216 7440 (Mobile: 07957 482330)
    Emma Grainge  020 7216 7392 (Mobile: 07712 841183)
Malcolm Tarling  020 7216 7410 (Mobile: 07776 147667)
Leonie Edwards 020 7216 7411 (Mobile: 07712 841184)

2. Copies of the GISC consultation paper are available from www.gisc.co.uk.

3. The ABI is the trade association for Britain’s insurance industry. Its more than 400 member companies provide over 97% of the insurance business in the UK. We represent insurance companies to the Government, and to the regulatory and other agencies, and provide a wide range of services to our members. ABI member companies account for more than a fifth of investments in the London stock market.

4. An ISDN line is available for broadcasts. 

Copies of all ABI news releases, together with other information from the Association, can be seen on our website http://www.abi.org.uk

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