More on insurance

Our job as a medical insurer is to help our customers fund their healthcare by complementing the NHS. We are trying to redress the balance back in favour of the patient. If the result of a customer's treatment - whether NHS or private - is not as anticipated the only redress has been through 'no win-no fee' lawyers."

Mr Stainton added that the cash plan, called Top-Up, "would be giving legal guidance to customers as to whether they have a case and introducing them to a lawyer that can help. All it is doing is getting the best NHS care to ordinary men and women."

The most recent Healthcare Commission report showed no improvement in hospital hygiene standards over a year ago, with 103 of 391 trusts not meeting minimum requirements imposed by the Department of Health.

Failure to tackle the menace of MRSA and Clostridium difficile is not only associated with more than 8,000 deaths a year in England and Wales. Most victims survive - but only after prolonging their hospital stay two-and-a-half times the scheduled period and gulping antibiotics for weeks afterwards. C.-diff is the biggest, and growing, problem. In the early 1990s, just over 1,000 patients a year fell victim. Today, more than 1,000 are infected each week.

Currently, the chances of infection victims getting legal redress are slim. But this could change.

Peter Walsh, chief executive of Action Against Medical Accidents, said: "It's notoriously difficult to bring a claim because the hospital will always say 'prove to us you didn't have the infection in the first place."

That may change as some NHS hospitals now test patients for infection as soon as they are admitted to hospital. However, that this is not easy with emergency admissions. But routine checking pre-admission is quite feasible with planned admissions, as private hospitals routinely demonstrate with minimal infection cases.

Mr Walsh added: "Despite the problem of proving negligence, there have been some successful cases, but most have been achieved under health and safety rules."

The plaintiff needed a witness who could show that a nurse or medic was re-using a syringe, moved between patients with open wounds without washing and swabbing, or blatantly disregarded hygiene protocols.

Cash plans are low cost insurance schemes that help meet everyday healthcare costs. Anyone buying the new scheme gets the core benefits for £15 a month. These include dental and eyecare cover, and money for hospital stays as well as the legal guidance service.

The policyholder then has the option of buying add-ons. These include a private cosmetic surgery benefit for a £4 a month. The benefit is said to be unmatched anywhere.

For £1 a month, policyholders can get A&E cover abroad, including repatriation. The benefit is described as travel insurance without the baggage.

The plan is designed to complement the NHS. For instance, at least 10 major new cancer drugs are denied NHS patients in England and Wales. For those under age 60, these are covered for £4.20 a month further to the £15 basic premium.

Criticism is widespread that patients, as well as being denied the drug precribed by their oncologist, cannot continue NHS care even if they choose to buy the drug from their own pocket.

Although Health Secretary Alan Johnson has ordered a review of the ban on NHS patients buying private extras, the prohibition will remain until at least October when the review team reports.

Mr Stainton said such resistance would be open to legal challenge. In a highly unusual move, the insurer would fund a legal challenge bought by a policyholder under the right circumstances.

He said: "We would instruct leading counsel, and a firm of solicitors to mount a challenge because it's been made clear there is no basis in law to prevent NHS patients buying betters drugs. In principle we would have no hesitation in supporting one of our policyholders in a legal challenge."