Services of an Insurance Intermediary: Introductory services: Medical services
Following the tribunal decision in Morganash, certain insurance related medical services fall within the insurance exemption
Morgan ash provided services to life insurers by conducting telephone interviews with persons seeking life assurance. A registered nurse prepared a health report for the insurer who used the information to decide whether or not to provide cover and the level of premium required. The Tribunal found that, in the light of the Andersen decision, the services provided by Morgan ash would not be covered by the exemption under EC law because Morgan ash were not bringing together the parties to the insurance contract. However, the Tribunal concluded that such services came within the exemption in current UK law as the carrying out of work preparatory to the conclusion of contracts of insurance, since without the information about the applicant’s health the insurer would be unable to conclude the insurance contract.
As a result of this decision we accept that businesses supplying medical services to insurers in connection with the setting up or administration of insurance policies are able to exempt their supplies under the current Group 2 until UK law is amended to take account of the Andersen decision. In the meantime, businesses wishing to treat insurance related medical services (which do fall within the health exemption) in accordance with EC law are able to treat them as taxable.