Following the news that an independent review has suggested that the UK’s legal smoking age should rise by a year every year;

Benjamin Hatton, Associate Analyst at GlobalData, a leading data and analytics company, offers his view:

“Private medical insurers will most likely be pleased with the suggestion made in the independent review. Smokers are more likely to purchase a private medical insurance policy, and make a claim on such a policy, making them hugely detrimental to the bottom line. According to GlobalData’s 2021 UK Insurance Consumer Survey, 13.1% of smokers own a private medical insurance policy compared to just 9.4% of the general population.

“Encouraging smokers to replace their habit with vaping may further help insurers, as vapers are less likely to make a claim on their health insurance policy. Again, according to GlobalData’s 2021 UK Insurance Consumer Survey, slightly less than half of vapers (49.4%) made a private medical insurance claim in 2021, compared to 55.6% of smokers. While not perfect, it is certainly a step in the right direction for insurers and the general health of the population. Insurers could look at ways of incentivizing smokers to quit without using vapes for even better results.

“The government’s goal of becoming smoke-free by 2030 will also reduce the burden on the NHS; however, this may hinder the uptake of private medical insurance throughout the UK. Approximately 24.8% of respondents to GlobalData’s survey indicated that they purchased a private medical insurance policy due to worries about NHS waiting times or service. Improving the NHS in the UK could prove to be slightly counter-productive to the health insurance industry.”

According to GlobalData’s report, ‘United Kingdom (UK) Tobacco Products – Market Assessment and Forecasts to 2025’ the UK tobacco sector is expected to register a negative CAGR of 1.4% by value during 2020-2025.