If you’re looking to implement Business Health Insurance for employees, the first thing many people consider is just how much it will cost.
There are a variety of factors that will influence the cost of the scheme, however, which makes it tricky to give a general idea of the cost.
We’ve laid out quotes below for two very different companies with different needs to give a rough idea of pricing for a Company Health Insurance policy, but please be aware the cost of a scheme per employee varies considerably and depends on a range of factors.
Average Cost of a Business Health Insurance Scheme per Employee
Business Health Insurance schemes are very similar to Private Medical Insurance paid for by individuals, with the main difference being that the policy is paid for by the company rather than the individual receiving the cover.
This means that the same factors affecting the cost of Private Medical Insurance will also have an impact on your group scheme.
One of the most obvious influences on the cost of a group policy is the size of the group you want to insure. While there is an additional cost per employee, the larger the group size the greater the discount and the lower the cost per employee.
Just as with individual cover, employees are rated based on their age. Each individual employee is considered before their premiums are added up into the total you pay for Business Health Insurance. This means a workplace with mostly older employees will likely face a higher total premium than a younger workforce. For example, a thirty-something employee might have individual premiums of around £40 per month while an employee over 60 could cost more than £120 per month to cover.
The cost of Business Health Insurance depends partly on the occupation risk class your employees are in. Therefore, if your employees work in occupations that put them at greater risk of falling ill or being injured, you will likely be required to pay more for your group insurance policy. If your employees work in an office setting, then the risk would be reduced compared to a scheme covering scaffolders or firefighters, which may pay more in premiums to reflect the increased chance of them making a claim.
The location of your company will have an impact on the cost of your policy. This is because private hospitals and treatments vary in cost depending on where you are in the UK. If your company is based in London, for example, private hospitals can be particularly expensive, especially those situated in central London. Because of this, you can expect your policy to cost more than it might for a company based elsewhere in the UK.
It’s important to note that Company Health Insurance is a taxable P11D benefit in kind for employees, so there’s usually additional tax due from employees on the value of premiums paid on their behalf.
Case Study: Cantilever Architects, London
Cantilever Architects is a small team of London based architects consisting of 5 members that want a Business Health Insurance scheme that covers all of their employees.
They’re looking for a scheme with full outpatient cover, psychiatric cover, £100 excess, and moratorium underwriting. Below are some rough quotes of how much this type of policy will cost from each of the different insurers on an annual basis as well as per employee.
Case Study: BitWare Ltd, Manchester
BitWare is a Manchester based company with a total of 76 employees that they want to have covered by their Group Health Insurance scheme. This company is also looking for moratorium underwriting, a £100 excess and full outpatient and mental health cover.
While there are more employees than the above example, there can be a group discount for larger schemes, leading to a lower cost per employee.