Health insurers have been on the front line of the COVID-19 pandemic. They have had to get to grips with the new peril of the COVID-19 virus, experience changes in demand and plan for the long term while adjusting to lockdowns and home working.
Mark Allan, Commercial Director UK Insurance at Bupa, joins Robin to discuss Bupa’s experience during the pandemic in the UK and what lies ahead.
Talking points include:
- The challenges of being a health insurer during a pandemic
- The long term impact of COVID-19
- Digitising customer access and engagement
- The challenge of legacy systems
Today’s podcast is sponsored by Fadata. Fadata has been providing software to the insurance market for over 30 years. Its modern insurance process platform, INSIS, spans the entire insurance product lifecycle for life, non-life and healthcare insurance. You can find out more about Fadata at www.fadata.eu.
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Continuing Professional Development
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The Learning Objectives for this podcast are:
- Understand some of the impacts the pandemic has had on health insurers
- Compare some of the ways that the pandemic has accelerated digitisation
- Recognise the potential of embedded insurance for health insurers
To continue learning about the impacts of the pandemic on insurance, read our insight Covid-19 - Insurance innovation your time has come.
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Private healthcare in the pandemic and beyond - Episode 157 highlights
Robin: Are there any differences between running a health insurer and a UK composite (life and non-life) insurer?
Mark: Insurance fundamentals are still the same: getting pricing right, managing claims well and giving good customer service. The difference between health insurance and other types of insurance is the degree of emotion associated with claims. For customers, looking after themselves and their family is another level.
Robin: What has it been like to run a health insurer during the COVID-19 pandemic?
Mark: We had a frantic couple of weeks moving to home working. Then the big customer challenge was the temporary disruption to some medical treatments as independent providers rightly supported the NHS (UK National Health Service).
We decided early on to pass back any exceptional financial benefit ultimately arising as a result of the impact of COVID-19 to our UK health insurance customers. We announced that we would pay back £125 million to our customers, which is largely paid now.
Robin: What has the reaction been to the rebate?
Mark: Any business aims to come out of a difficult period like this with its reputation intact. The industry press awarded us the best pandemic response of all life and health insurers over 2020. Brokers have been supportive, and customers have been grateful.
Robin: Are you concerned about the long-term effects of the COVID-19 pandemic?
Mark: Demand for private medical insurance has increased as some employers are now choosing to spend more on health and wellbeing, and at the same time there’s increasing pressure on the NHS.
We believe pent up demand and delays to treatment will increase claims volumes in the short term. With cancer, speed of diagnosis and access to treatment is essential. There will be a backlog of cancer cases which the delay has made more serious. We have also seen claims volumes on mental health above 2019 levels.
Looking specifically at COVID-19, there is still uncertainty as to what long COVID-19 is. The Bupa Cromwell Hospital has set up a long COVID-19 clinic which will help us learn more about the illness.
Robin: Has COVID accelerated digitisation in your experience?
Mark: It has accelerated ways customers can access services. It could be as simple as having online forms to fill making it easier for customers than struggling to get through on the phone. There are more sophisticated things such as digital primary care. Bupa has partnered with Babylon on Digital GP services. The last year saw over 250,000 appointments, about 4,500 per week, and 90% of customers give a five-star satisfaction rating.
We are constantly looking to try new ways of delivering care virtually where appropriate and possible. We recently tested a new virtual physiotherapy service with around 6,000 appointments. We even launched the ability to have a dental check-up via iPhone.
Robin: Do your customers want regular digital engagement?
Mark: Health insurance has an opportunity to be something customers will engage with more easily. There is now an opportunity to have a more regular dialogue. But it’s not easy to do. It requires great data and technical capabilities.
That is also true for how businesses use digital to support the health of their staff. Businesses are increasingly looking for a health and wellbeing risk manager to work with them on looking after their workforces effectively.
Robin: What is your perspective as a health insurer on the potential for embedded insurance?
Mark: For embedded insurance to work effectively, it must be easy to sell, easy to access, and enhance the brand for the insurance product. For health insurance there are some embedding challenges. Private medical insurance is often too complex and expensive to be sold as an add-on. There are examples where this does work, such as access to lower value health-related services being offered as add-ons, such as primary care, support helplines, digital GP services or mental health services.
Robin: As Bupa has become more digital, have you encountered issues with your legacy technology?
Mark: Like any other large insurer we are working through legacy challenges. COVID-19 brought home those challenges and helped us identify what we need to change. We are introducing new agile ways of working and making our systems more configurable. Some of that is in-house, some of that is with partners.
Robin: What sort of companies would Bupa like to connect with?
Mark: We are interested in anything in insurtech or healthtech that can add value to a customer’s end-to-end health journey. We are also interested in technology to assist distribution, policy admin, renewal, self-serve and automation.
Robin: What lies ahead for Bupa?
Mark: The obvious focus areas for health insurers over the next 3 - 5 years will include dealing with the remaining consequences of the pandemic such as how we use actuarial data - two years of unusual claims data will confuse the ability to use the past to predict the future. We will have to try and work out what is normal.
And of course, we‘ll continue to focus on digital transformation, from fundamental technology to changing our work methods and customer interaction.