Keeping Individual Health Insurance In Retirement

Get My Instant Quotes
Compare Top UK Health Insurer Quotes Logos
27-10-2020

One problem with ageing in the UK is the difficulty that many people find in securing and maintaining Private Health Insurance for their retirement years.

The cost of Individual Health Insurance in retirement rises with age, so many people will face higher prices for their cover as they get older and affording these premiums can be a concern.

The problem is especially acute for those who may have enjoyed extensive Health Insurance cover during their working lives thanks to a Group Health Insurance policy that was offered by their former employer.

This might have included wide-ranging cover, including coverage for pre-existing medical conditions depending on the insurer and the scheme in question.

Part of the problem is the differential between what it costs to insure someone in their sixties as part of a group scheme and how much individual Health Insurance can cost.

Individual Health Insurance Costs More in Retirement…

“The average age of members in a group company scheme tends to be between 35 and 45,” explains Farid. “But, historically, around 40% of the individual PMI market is aged 65 and over and, according to PMI insurers, 98% of the premiums of an average 60-year-old’s Health Insurance will be spent on claims.

“This explains why individual health insurance costs generally twice as expensive as group cover,” he says.

Due to elderly policyholders making more claims, individual health insurance providers hike up the cost of premiums for retirees and those over 65.

Leaving a Group Medical Insurance scheme

Sticking With the Same Health Insurer Post-Retirement Could Cost…

Previously, a number of insurers offered ‘retiree Health Insurance plans’ to older Britons, which enabled employees of larger companies to transfer their cover on reasonable terms.

However, Bupa recently closed some of its retiree group plans and requested that members aged 65 and above transfer out. We expect to see other larger PMI providers following suit.

Until recently, a number of affinity schemes also offered discounts to groups such as farmers or civil servants but these are also now rescinding the discounts they once offered to older members due to the increase in individual health insurance costs when covering seniors.

Nadeem Farid, Health & Wellbeing Expert at Drewberry, can offer health insurance advice for retirees

While technically insurers can’t refuse individual cover to an existing group scheme member, they’re free to increase premiums and reduce cover as they see fit.

However, the reality is that few insurers are likely to consider taking on a transferring member who’s claimed in the last 12 months.

Nadeem Farid
Health & Wellbeing Expert at Drewberry

Self-Funded Private Healthcare

Another way to get reduce the cost of Private Health Insurance for older people is to consider self-funding some procedures. This can be cheaper than insurance, especially if you consider the impact it will have on your premiums over time. However, it means putting something aside in an ISA or a similar savings vehicle so that the cash is always there if you need it.

“If you manage to go up to 5 years without making a claim,” says Nadeem, “then you’re in a position to switch between providers, which could also significantly reduce your Medical Insurance premiums.”

This means that securing PMI cover in later life can often be a two-stage process: the first stage is to secure affordable cover; the second stage is to review your cover options at each renewal. With luck, if you’ve avoided making a claim, you’ll be in a position to reduce your premiums by switching providers, or increase your cover.

Compare Top 10 UK Insurers
Takes approx. 60 seconds

Tricks of The Health Insurance Trade

Tailor Your Policy to Reduce Individual Health Insurance Cost

Nadeem points out that: “A large proportion of our individual PMI business is with older people who are often seeking out PMI cover for the first time. The best advice for Britons at this stage of their lives is to start thinking like an insurer.

“Apart from the small minority of clients to whom price is no object, at this stage in your life, it all comes down to managing your health on a holistic basis where PMI cover is just one of the solutions.

“For most people, this means the best approach will be to look at private health insurance options like adding an excess to your Medical Insurance policy. This can help reduce premiums by up to 20%. Adding a 6-week NHS deferment option will also bring you individual health insurance cost down, as will removing non-core options such as therapy or outpatient benefits.

Often, securing appropriate private medical cover in retirement is a lot like car insurance: it all comes down to protecting your ‘no claims bonus’. There are plenty of options for older people, but it means deciding what’s most important, setting a ceiling for your individual health insurance cost and managing your claims appropriately.

Why Speak to Us…

We started Drewberry because we were tired of being treated like a number and not getting the service we all deserve when it comes to things as important as protecting our health and our finances. Below are just a few reasons why it makes sense to let us help.

  • There is no fee for our service
  • We are independent and impartial
    Drewberry isn’t tied to any insurance company, so we can provide completely impartial advice to make sure you get the most appropriate policy based solely on your needs.
  • We’ve got bargaining power on our side
    This allows us to negotiate better premiums for you than you going direct yourself.
  • You’ll speak to a dedicated expert from start to finish
    You will speak to a named expert with a direct telephone and email. No more automated machines and no more being sent from pillar to post – you’ll have someone to speak to who knows you.
  • Benefit from our 5-star service
    We pride ourselves on providing a 5-star service, as can be seen from our 3083 and growing independent client reviews rating us at 4.92 / 5.
  • Gain the protection of regulated advice
    You are protected. Where we provide a regulated advice service we are responsible for the policy we set-up for you. Doing it yourself or going direct to an insurer won’t provide this protection, so you won’t benefit from these securities.
  • Claims support when you need it the most
    You have support should you need to make a claim. The most important thing when it comes to insurance is that claims are paid and quickly. We are here to support you during the claims process and make sure it’s as smooth and stress free as possible.

Very helpful from start to finish. Talked through all the points and gave great advice.

Darren Comer
16/05/2021
Reviews.co.uk Logo
Compare Top 10 UK Insurers
Takes approx. 60 seconds

Or call us on 0208 432 7333

Compare Top UK Health Insurer Quotes Logos
Contact Us
Head Office & Pensions and Investments
Senator House
85 Queen Victoria Street
London
EC4V 4AB
Personal Insurance & Accounts Payable
Telecom House
125-135 Preston Road
Brighton
BN1 6AF
Drewberry London Office MapDrewberry Brighton Office Map
Our Core Principles
  • 1You Come FirstWe are a client focused business who always aim to put you first.
  • 2We are ExpertsTo provide you with the best advice, we need to know our stuff!
  • 3We are HumanWe are real people with feelings who are here to help you.
  • 4We are ProfessionalProviding a 5-star service requires a professional approach to everything we do.
  • 5We are here to EducateWe don't believe in sales, we are here to educate so you can make informed decisions.
Finalist - Moneyfacts AwardsFinalist - Cover Excellence AwardsHighly Commended - Protection Review Awards
Proud member of AMII (Association of Medical Insurers & Intermediaries)Proud member of Money Advice ServiceProud member of UnbiasedProud member of BIBA (British Insurance Brokers' Association)

If you are unhappy with our service, we have a complaints procedure, details of which are available upon request. If you are unhappy with how your complaint has been dealt with, you may be able to refer your complaint to the Financial Ombudsman Service (FOS). The FOS website is www.financial-ombudsman.org.uk.

Drewberry Ltd is registered in England and Wales. Companies House No. 06675912

Drewberry Ltd registered office: Telecom House, Preston Road, Brighton, England, BN1 6AF. Telephone 0208 432 7333

Drewberry Ltd (Financial Conduct Authority No. 505473) is an Appointed Representative of Quilter Wealth Limited and Quilter Mortgage Planning

Limited, which are authorised and regulated by the Financial Conduct Authority.

Drewberry™ uses cookies to offer you the best experience online. By continuing to use our website you agree to the use of cookies. If you would like to know more about cookies and how to manage them please view our privacycookie policy.