Should I use IFA to purchase private health care?

honestsammy · 9 October 2016 at 11:38AM

Hi,
I've recently gone freelancing and have recruited the services of an IFA to look at life insurance and pensions for me, and also private health care. On the last point they said that there were basically 3 main providers and that I'd need to choose one as they all vary a little. I'm probably going to go with the pru again as I quite liked the vitality stuff - had it in my last permie job. However is there actually any advantage in the IFA doing this for me? The IFA seems to be commissioned based and I'm a little wary about that. They did not offer me the option of paying an up front fee for their services - but that's another matter I guess.

The reason i ask is that they seem to be taking ages to do anything, so I just want to get on with a few things like the private health whereby i reckon the quote should be the same whoever applies (myself or the IFA on my behalf).

Thanks

dunstonh · 9 October 2016 at 11:48AM

I'm probably going to go with the pru again as I quite liked the vitality stuff

The vitality plan is marmite. I know advisers that think its brilliant and others that believe it is a fad. It depends on how good you are at keeping up the requirements.

The IFA seems to be commissioned based and I'm a little wary about that.

Whilst in most areas, an IFA will be fee based, insurance is just one of two areas where they can still take a commission. However, you can go fee basis if you prefer. On fee basis, the commission can be set to match the fee or you can pay the fee directly and get lower premiums.

They did not offer me the option of paying an up front fee for their services - but that's another matter I guess.

The vast majority of people dont pay by fee basis on insurance. They dont have to offer it but it should be available upon request.

i reckon the quote should be the same whoever applies (myself or the IFA on my behalf).

No. The premium will change depending on the terms negotiated with the insurer by the intermediary/distributor and the amount of commission they decide to take. Commission varies across the lot and is not a fixed amount.

honestsammy · 9 October 2016 at 11:53AM

I was on the pru before and I quite enjoyed the points based nature of it. It is a little faddy admittedly but unless it's loads more expensive then I'm happy with it.

So the answer is that an IFA maybe able to offer me a better deal than if I went up on my own - so best thing to do would be for me to get a quote anyway so I can check if the IFA quote is better?

This is where in lies the problem I think for an IFA. Everything they are going to do for me, i either accept as the best quote or I do everything myself again anyway to make sure it is the best quote.

Quentin · 9 October 2016 at 12:18PM

honestsammy wrote: »

So the answer is that an IFA maybe able to offer me a better deal than if I went up on my own -....

Easy to DIY.

Once you have chosen your company, you can contact a specialist broker and see if they can get you a better deal (through their contacts or maybe via a commission share).

There is a (newly updated) MSE article on getting private health care insurance that covers all the points for getting the best deal:

http://www.moneysavingexpert.com/insurance/cheap-health-insurance

honestsammy · 9 October 2016 at 1:56PM

Thanks - I've been a bit busy setting up my the business etc hence why I contacted the IFA. Will end doing the due diligence anyway I guess.

dunstonh · 9 October 2016 at 6:45PM

honestsammy wrote: »

Thanks - I've been a bit busy setting up my the business etc hence why I contacted the IFA. Will end doing the due diligence anyway I guess.

If you use an IFA, they have to research the provider and make the recommendation. If you use a broker, they will just offer you a selection or the cheapest but you choose.

Weighty1 · 10 October 2016 at 2:06PM

Personally I'd go to a PMI specialist since there are so many nuances between policies/providers. The very fact that your IFA said you need to pick one of 3 makes it sound like they don't really write a lot of PMI cover otherwise they should be more confident in making an actual recommendation.

Whilst I don't write PMI business an associate of mine who does said that typically premiums are the same whichever route a client uses to purchase cover, direct, via a broker etc.

Should I use IFA to purchase private health care?

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