How does private health insurance work in the UK?

This article aims to shed light on how the private medical insurance industry functions within the UK’s healthcare landscape. It outlines the benefits of private insurance, such as shorter waiting times and access to specialised treatments. The conclusions drawn are based on a review of the existing healthcare framework and insights into how private insurance supplements public healthcare services.

What is private health insurance

Private medical insurance in the UK is designed to cover private medical care for acute conditions. These are issues that won’t last for a long time, unlike the health problems that people live with throughout their lives, which are called chronic illnesses.

There are good things about having health cover:

But, remember that health insurance doesn’t cover everything. You can choose how much help you want. So, you can decide on a simpler plan that costs less, as long as it still gives you enough help.

Considered private health insurance offers coverage for medical expenses not covered by public plans, providing individuals with additional healthcare options and benefit.

Advantages of private insurance

While health insurance provides significant advantages, its cost must be considered. Let’s explore both its benefits and disadvantages.

• Bypass NHS waiting times
• Select your preferred specialists
• Receive treatment in private rooms
• Includes treatments and drugs not covered by the NHS

What are the disadvantages of private healthcare?

• Certain conditions might be excluded
• Claim limits on treatments
• Excess payment required
• NHS alternatives with wait times
• Emergency NHS care is often necessary
• Distance may be required for private care

Types of private medical insurance

The type of insurance options is determined by the individuals you intend to include in the policy. The primary categories include:

• Individual- Personal health coverage for one person, including treatments and services not covered by public healthcare.
• Family- Coverage for the whole family’s medical expenses. Ensures access to healthcare without financial burden. Vital for peace of mind.
• Couples- provides medical coverage for married or partnered individuals, offering comprehensive healthcare services and support for both members.
• Seniors-  provides cover for individuals over 50 years old, addressing specific healthcare needs and ensuring financial protection in later years.
• Child-  provides comprehensive medical coverage tailored to meet the specific healthcare needs of children, ensuring their well-being.
• Self-Employed Insurance– provides medical coverage for those who work independently, ensuring access to healthcare services.
• Company– Employer-provided medical coverage. Protects employees’ health. Includes treatments, check-ups, and medications. Valuable work benefit.

How does a private medical insurance claim work?

​​When you have health insurance and you require treatment at a hospital while your policy is valid, your insurance company will cover the costs for you. However, for them to do this, you have to initiate a process called “making a claim.” Here are the basic steps you should follow when you need to claim with your private healthcare insurance provider:

1. Check Your Cover Details: Review your health insurance policy to understand the coverage details. Check if the specialist and treatment are covered under your policy. 
   As an example: If you’ve included the six-week option to reduce the cost of your health insurance policy, it’s important to know that you won’t be eligible to claim your if the NHS can provide treatment within six weeks. Similarly, if you’ve lowered your cancer coverage, cancer treatment won’t be covered. Be sure to comprehend these specifics to prevent any potential disappointment.
2. Make a claim: Each insurance company follows its steps, but generally, they will ask for a referral letter from your GP to a specialist. This is to make sure that you get the right care for your condition. After getting the referral, you should call your policy provider and give them the details.
   In some cases, the insurance company itself will connect you with a specialist bypassing the need for a GP referral. If this happens, you can usually kickstart the claims process online or by making a phone call. Once you’ve initiated the process, all you have to do is wait for your claims to be approved.
3. Treatment: Once your insurance company approves the treatment expense, you can select a healthcare provider from the list of approved hospitals in your policy. You can then schedule an appointment right away. Your insurance company will pay the provider directly, so there’s no need for you to handle any reimbursement or claims on your own.

What does your medical insurance cover?

So what does private healthcare cover? Private Medical Insurance (PMI) policies are made up of two key parts: core cover, which is included by default, and add-ons – these are extra features that may come at an additional cost, but they expand and improve your coverage.

Core Cover

• Inpatient: This is when you need to stay in the hospital overnight. The coverage takes care of expenses like where you sleep in the hospital, payments to specialists like doctors and surgeons, tests, CT scans, MRIs and X-rays. Some insurance plans might give you extra benefits, such as physical therapy.
• Day-patient: This is for when you go to the hospital but don’t stay overnight. Use the same facilities as inpatient clients. 
• Outpatient: This is when you use the hospital for seeing the doctors/consultants, tests, scans, and even small surgeries. 
• Digital GP: provides quick access to virtual consultations with general practitioners. Now, nearly every insurance provider offers this feature, facilitating immediate medical guidance and consultations via digital platforms for enhanced convenience.

*Inpatient and Day-patient covers are always unlimited with all insurers across the UK, However, to lower the premium, you can limit your outpatient cover between £500 and £1,500.

Core Cover Options

• Hospitals: You can change how much you pay for your insurance by picking the hospital you want to go to. For instance, if you want to go to a fancy hospital like the ones in Central London or HCA hospitals, you’ll have to pay more for your insurance premium.
• Six-Week Option: The six-week option in health insurance refers to a policy feature where treatment for certain medical conditions under the National Health Service (NHS) is covered only if the NHS wait exceeds six weeks.
• Cancer Cover: Cancer cover in UK health insurance includes diagnostics, treatments, and rehabilitation for cancer-related care. Certain policies permit downgrading for NHS treatment only, resulting in reduced premiums.
• Policy Excess: Health insurance policy excess refers to the amount you pay before insurance coverage begins. Choosing a higher excess, typically ranging from £100 to £5,000, can reduce premiums, paid either per person per year or per claim.

Optional Add-Ons

Here are some optional add-ons that can boost your coverage:

• Worldwide Travel: covers standard travel insurance, such as flight delays, loss of belongings, legal support, and even winter sports. It also provides coverage for medical emergencies while abroad.
• Dental and Optical: Secure coverage for common dental treatments like fillings, crowns, accidental damage, and emergencies. Optical coverage aids in offsetting expenses for eye exams, glasses, or contact lenses 
• Mental Health: provides support for the diagnosis, treatment, and management of mental health conditions. This can include therapy, counselling, and psychiatric consultations. Some policies may also cover inpatient treatment if needed.
• Therapies: Covering costs of therapies like physiotherapy, osteopathy, and chiropractic care. Some insurers also include additional holistic therapies.

Exclusions from private health insurance

Exclusions are a common aspect of Health Insurance policies offered by all insurance providers. These exclusions are specific conditions or situations that the insurance won’t cover. They often involve matters that are primarily the responsibility of the National Health Service (NHS). The following categories are typically excluded:

Pre- Existing conditions

Pre-existing medical conditions matter in medical insurance because they won’t be covered initially, usually for the first few years. These are illnesses or conditions you’ve received treatment for or got advice on within five years before the policy. Your insurer won’t cover pre-existing conditions for the first two years unless you’ve been free of treatment or advice during that time. You might have the option to include coverage later on.

Other Exclusions

As previously stated, every insurance company has a set of exclusions outlining situations where claims for private healthcare won’t be accepted. The standard exclusions you’ll encounter with most health insurers include:

• Accident and Emergency: Immediate medical attention is required for sudden accidents or emergencies.
• Chronic Conditions: Ongoing health issues like asthma and diabetes, which usually need continuous care.
• HIV & AIDS: Health problems that receive specialised treatment from public health services.
• War, Riots, Terrorism: Events of a larger scale, beyond the scope of regular health insurance.
• Dangerous Sports: High-risk activities, such as base jumping or snowboarding, may not be included due to their inherent danger.

It’s crucial to understand that different insurance companies have their distinct lists of exclusions. Our experienced advisers are available to guide you through these exclusions for any policy you are considering. They can provide a clear understanding of what the policy covers and what it doesn’t, ensuring you make an informed choice about your health insurance coverage.

Types of Underwriting

In insurance, two types of underwriting are employed to define coverage and exclusions, ensuring a clear understanding of what is included and what is not within a policy.

Moratorium underwriting- is a method used in insurance where pre-existing medical conditions are not covered initially. Instead, coverage for these conditions can be reinstated after a specified period if the policyholder remains free of symptoms, treatment, and medication related to the condition. It’s a way for insurers to provide coverage while managing the risk associated with pre-existing conditions.

Full Medical Underwriting- refers to an insurance underwriting process where an individual’s entire medical history and health status are thoroughly assessed before a policy is issued. This includes disclosing pre-existing conditions, past medical treatments, and any ongoing health issues. Based on this detailed information, the insurance company determines coverage options and premiums.

Every insurance company has its list of things they won’t cover. Our experts can guide you through these rules for any policy we offer, so you know exactly what’s included and what’s not before you decide.

How much do you pay for private health insurance in the UK?

The cost of health insurance in the UK is influenced by a combination of factors, each contributing to the overall premium individuals pay for coverage. These factors include:

• Age: Younger individuals often have lower premiums as they are assumed to have fewer pre-existing health conditions and a lower likelihood of immediate medical needs.
• Postcode: Healthcare costs can vary by location due to differences in the availability of medical facilities, specialists, and cost of living.
• Excess: The chosen excess amount, the portion an individual agrees to pay before the insurance coverage activates, can impact premiums. Opting for a higher excess lowers premiums but may increase out-of-pocket costs later.
• Coverage Level: The comprehensiveness of the insurance plan, ranging from basic to comprehensive coverage, directly affects premiums. Plans with extended coverage, including dental, optical, and wellness services, tend to have higher premiums.
• Chronic Conditions: Individuals with chronic health conditions might face higher premiums due to the expected need for ongoing medical care.
• Pre-existing Conditions: Similar to chronic conditions, pre-existing health conditions impact costs. Some insurers might charge higher premiums to cover these conditions or exclude coverage altogether.
• Lifestyle Factors: Certain habits like smoking or excessive alcohol consumption can lead to higher insurance premiums due to associated health risks.
• Family Coverage: Plans covering multiple family members can impact premiums, with larger families often paying more.
• Plan Type: Different insurance plans, such as basic, intermediate, or premium plans, come with varying coverage and cost structures.
• Insurance Provider: Different companies have unique pricing models and risk assessments, leading to variability in premiums.

How do I get private health care?

To get private healthcare in the UK, follow these steps:

Research Providers

Look into private healthcare providers and insurance companies. Compare their services, costs, and coverage options.

Choose a Plan

Select a private health insurance plan that suits your needs and budget. Plans vary in terms of coverage, such as hospital stays, specialist consultations, and treatments.

Apply for Insurance

Apply for the chosen health insurance plan. This may involve filling out forms and providing personal and medical information.

Once insured, you can choose from a list of private hospitals, clinics, and doctors associated with your insurance provider.

Speak to a broker

If you need more information or are still unsure about how to get a health insurance plan, please contact our independent health insurance specialist at PremierPMI, who will guide you through the entire process.

Stuart Hendy, Senior PMI Advisor &Editor

Stuart Hendy is a highly experienced health insurance broker with extensive knowledge of private medical insurance and private treatment. His expertise is frequently sought by industry professionals and his insights have been featured in leading financial publications. Stuart is committed to providing his clients with the best possible healthcare solutions and empowering them to make informed decisions.

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