Small Business Health Insurance (SME) in the UK

How does small business health insurance work?

Health insurance for small companies gives employees access to high-quality private medical care, bypassing NHS waiting lists. It offers core coverage and optional extras, allowing you to tailor the plan to your needs. The policy includes rapid tests, diagnoses and treatments.

Group coverage ensures all staff are covered as long as premiums are paid. Suitable for companies with 1 to 249 employees, this insurance improves employee satisfaction and reduces absenteeism. To find the best plan, request small business health insurance quotes from various providers.

Is company health insurance worth it?

A survey by the Association of British Insurers found that more than half of people (57%) think about health insurance, and almost half (49%) consider income protection when choosing a job. Also, seven out of ten (69%) people would think about getting medical insurance if it was offered by their employer.

Wondering if company health insurance is worth the investment for your business? Here’s why it’s a smart move:

Attract and Retain Talent

Offering comprehensive health coverage demonstrates your commitment to employee well-being, making your company more attractive to top talent. It’s a powerful tool for recruiting and retaining skilled professionals who value their health and security.

Reduce Absenteeism

With private insurance, you and your employees can skip the long waiting lists of public healthcare systems. Access to timely medical treatments means faster recovery times, reduced absenteeism, and a healthier workforce overall.

Boost Productivity

When employees feel supported and cared for, they’re more likely to be engaged, motivated, and productive at work. Providing health insurance sends a clear message that their health and wellness matter, leading to higher morale and job satisfaction.

“The greatest asset of a company is its people.”
– Jorge Paulo Lemann 

Our article helps you understand a small company’s health insurance benefits. Learn how it can support you and your employees by providing quick medical care and improving job satisfaction. We offer guidance on understanding costs and choosing the right coverage. Let’s explore how business cover can make a difference, keeping your employees healthy and boosting your business’s success.

Small Business Private Health Insurance Cover

Small Business Health Insurance offers a private health plan for you and your employees, granting access to private diagnostics, treatments, and follow-up care. The extent of coverage typically caters to acute conditions, with curable pre-existing conditions often subject to exclusion for a specific period, while chronic conditions—those less likely to improve—are typically permanently excluded.

This type of coverage strikes a balance between proactive and reactive healthcare, providing both preventative measures and responsive treatments. Employees appreciate the benefits of swift access to treatments and the convenience of consulting with online GPs.

Core Cover

Core cover offers the basic benefits that are typically provided to all policyholders regardless of additional options or add-ons. Core cover usually includes essential healthcare services such as:

• In-patient treatment
• Day-Patient
• Cancer Cover
• Virtual GP ( with most insurance providers)
• Basic Hospital List

The core cover forms the foundation of the policy, with additional features or benefits available as optional add-ons depending on the specific needs and preferences of the company.

Extras

Extras are add-on benefits or features that you can add to your health insurance plan to upgrade your core cover. However, it’s important to note that by doing so, your premium might increase. Examples of extras include:

• Outpatient
• Mental Health 
• Dental, Optical, and Audiology cover
• Physiotherapy
• Worldwide Travel Cover
• Hospital List Upgrade
• Private GP

Additional Benefits

Plus, many Business Health plans come with added choices and special benefits to make your plan even better at no cost. For instance:

• Employee Wellbeing Centre membership
• Fast track appointments 
• Employee Assistance Programmes
• Second medical opinion 
• Health Screening

Dependents

Expanding the company’s policy to cover an employee’s family is a great way to make your employees feel valued and committed. It recognises the crucial support families offer to employees’ work. The company can cover the extra cost or employees can choose to pay for it from their salary, which is also a good option. Usually, adding family members through salary deduction costs much less, so many employees go for it.

What isn’t covered?

Every health insurance plan has exclusions, which can be general or specific to an employee’s medical history.

Pre-Existing Conditions 

Any condition an employee sought treatment for in the five years before joining the policy isn’t covered initially.

Chronic Conditions

Long-term illnesses without a cure are generally not covered, such as: 

• Diabetes
• High Blood Pressure (Hypertension)
• Asthma
• Chronic Obstructive Pulmonary Disease
• Chronic Kidney Disease 
• Heart Disease
• Stroke
• Arthritis
• Epilepsy
• Mental Health Disorders:

Standard Exclusions

Most plans exclude: 

• emergency treatments
• straightforward pregnancy and birth
• fertility treatments
• addiction treatment
• cosmetic surgeries.

Provider-Specific Exclusions

Each insurer may have unique exclusions such as specific types of cancer treatments or certain mental health therapies.

Understanding these exclusions is crucial when selecting small business health insurance to ensure your employees have adequate health plans. Always review policy details carefully and compare quotes to find the best fit for your business needs.

How much is private health insurance for small business owners?

The cost of health insurance can vary based on factors such as the company’s location, how many employees you have, their ages, and the level of coverage needed. To provide insight into these costs for small businesses, our team of insurance experts conducted market research. We analyzed data from the top four UK health insurance providers: Aviva, AXA, Bupa, and Vitality. This research aimed to offer comprehensive information on how these factors influence the pricing of insurance plans tailored to small businesses.

Business Health Insurance Plans Сomparison

The cost of your policy can change depending on factors like your age, the hospitals covered, the excess you choose, and how much coverage you want. On average, it costs around £52 per month per employee in February 2024. But this can vary a lot, from £28 to £120 per month. For instance, if you’re over 50, you might pay more than someone who’s 20.

Let’s take a look at the price list for different levels of coverage based on the age of the policyholders, all with a £100 excess:

From the table provided, the basic cover includes full cancer cover, some outpatient cover, a basic level of hospital list and no additional benefits like dental and mental health.

Comparison by providers

Let’s compare what each provider offers: Bupa, AXA Health, Aviva, and Vitality:

These monthly prices are calculated based on an average employee age of 40 years old, across basic, mid-range, and comprehensive cover levels, with a £100 excess, and for a location in HA9. They are accurate as of February 2024 and may vary depending on location, age and the preferences of the company.

Price by number of employees

After researching pricing, we’ve gathered some insights for businesses with employees aged 30 to 40:

For instance, if you have 1 to 19 employees, you might expect to pay around £36 per employee.

With 20 to 49 employees, the cost could decrease to approximately £32 per employee.

And for 50 to 99 employees, the price might drop to about £28 per employee.

It’s important to note that these prices are subject to change, as the cost per person can change based on factors such as your location, the ages of your employees, your group’s risk level for insurance and the health plan you choose.