According to research from Datamonitor, the number of individual policyholders holding health insurance has fallen by 191,000 between 1996 and 2001.
In the same period, health premiums have increased by 59% in average individual premiums. The increase has been blamed on increased numbers of claims and also increased cost of claims.
Fiona O'Regan, author of the Datamonitor report said that many people will be driven to make provisions for their healthcare because the majority believe injecting vast sums of money into the NHS will not necessarily resolve the problems it is facing. She added that as customer awareness of new, affordable products increases, the private medical insurance market should enjoy a revival in an otherwise stagnant market.
The individual market saw a higher premium increase than the group market, mainly due to the higher average claims in the individual market. The average premium for an individual rose from £715 in 1996 to £1135 in 2001, respresenting an increase of almost 59%.