October 10, 2013

UK's Advertising Regulator Puts Fear into "Best Medical Cover"

Seller Beware: Consumer Protection Insights for Industry

eSmart Media Ltd trading have been reprimanded for using fear to sell private health insurance on its health insurance comparison website,

The website included a series of quotes from newspaper articles on a National Health Service (NHS) England review of the quality of care and treatment provided by 14 hospital trusts in England. The website referred to the situation as the "NHS crisis", highlighting the "staggering 13,000 deaths", that these were "likely to have been a tragic consequence of negligence" and concluded that private health insurance could "save your life!".

The UK's regulator of advertising, the Advertising Standards Authority (ASA), received a large number of complaints challenging whether the references to the review misrepresented the report and whether the advert used an appeal to fear to sell insurance. The relevant advertising code prohibits marketing communications from causing fear or distress without justifiable reason.

eSmart Media responded that the quotes and figures were taken from various articles in leading UK newspapers, acknowledging that these had since been disputed, and commented that pointing out documented examples of poor NHS treatment was important for the public.

The ASA upheld the complaints to eSmart's statements. As the references to the review were presented as factual, eSmart Media were required to hold robust evidence to support the claims and providing newspaper articles was not sufficient. The ASA concluded that the overall impression of the website along with the references to excess deaths, "NHS crisis" and how private health insurance could "save your life" used an appeal to fear to sell without any justifiable reason.

There is a fine line in the selling of products like insurance between providing the consumer with reasons why they should buy and scaring them in to a sale. This ruling from the ASA (as the organization even states itself) shows that marketers were entitled to refer to consumer concerns that might be reasons to purchase as long as they didn't tip the balance in to fear and distress.

© Arnold & Porter Kaye Scholer LLP 2013 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.

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