Why Have My Health Insurance Premiums Increased?

Why Private Medical Insurance Premiums Increase

As mentioned there are a number of reasons why your Health Insurance has increased in price, such as:

• Improved medical treatment – new drugs, operations and techniques are introduced all the time, but this comes at an increased cost
• Access to cutting-edge healthcare – often Private Medical Insurance will offer access to new and expensive treatments, particularly cancer drugs and therapries, that the NHS deems too expensive
• Ageing population – while it’s good news that we’re living longer than ever before, this is leading to a number of acute conditions of the type Medical Insurance is designed to fix, such as worn out joints requiring replacement
• General inflation – this pushes up the cost of everything from the electricity to light the operating theatre to the meals you may be served as an inpatient
• Insurance premium tax – this has increased three times since October 31 2015, from 9.5% to 12% today, and has had an impact on premiums despite widespread dissatisfaction at the move among most in the industry.

As you can see, there are a lot of factors working to increase the cost of Private Medical Insurance. It’s no wonder some people are seeing premium hikes at renewal as a result.

If this applies to you, then consulting with an expert adviser such as myself or one of my colleagues here at Drewberry may help. We could look to adjust your policy to lower Health Insurance premiums or even find a better deal elsewhere.

Matteo Mockler
Health & Wellbeing Expert at Drewberry

How Can I Get Cheaper Health Insurance?

If you’re not happy with your Private Medical Insurance renewal quote, there are ways to lower the cost of premiums without switching insurer if you don’t want to move.

Health Insurance is a policy with a wide range of variables that can be adjusted to suit your needs and circumstances, but also to reduce price if necessary.

What’s Covered by the Best Health Insurance?

The best Private Health Insurance will provide a wide range of coverage, including:

• Both inpatient and outpatient cover
• Access to all the best hospitals in the UK, no matter where they are or what they charge
• Full ‘therapies’ cover (e.g. physiotherapy, osteopathy)
• Low or no excess (so the insurer picks up the vast majority of the bill)

Other options you can add on to your private medical cover include:

• Additional dental cover – most Private Medical Insurance covers ‘accidental’ or ’emergency’ dental, so if you knock out a tooth, but doesn’t cover routine treatment, such as fillings, unless you pay extra for cover
• Additional optical cover – over and above surgeries such as cataract surgeries, additional optical cover will provide insurance for routine optical costs, such as glasses and eye tests
• Additional psychiatric cover – you may be able to pay more for additional psychiatric cover, which could provide more sessions with a counsellor, more money for treatment, longer inpatient stays etc. (all handled on a case-by-case basis by your insurer)
• Worldwide travel cover – can cover emergency medical situations that arise overseas.

Obviously in an ideal world we’d all have the best Health Insurance with all the bells and whistles. However, sometimes due to budget this is simply not possible.

Fortunately, Health Insurance is an inherently flexible product and there’s lots you can do to adjust cover and potentially see premiums come down significantly as a result.

Emma Wilson
Employee Benefits Consultant at Drewberry

How to Reduce the Cost of Private Health Insurance

One of the biggest things to check is that you’re actively using – or even need – every element of the cover on your policy. That’s why it’s important to review your Medical Insurance to make sure you aren’t paying for cover you may never use or simply don’t need.

For instance, sometimes people forget that they have travel insurance through a packaged bank account – would you need worldwide travel cover with your PMI as well?

Extra optical or dental cover might be a nice to have, but you could check to see if you were entitled to free or subsidised NHS dental treatment and eye tests.

Other tips to reduce your PMI premiums…

• Restrict your hospital access – the most expensive hospitals in the country (usually those in central London) are usually found on insurers’ ‘top tier’ of hospitals. Opting to restrict your access to a lower tier of – still private – hospitals rather than having access to these top ones can cut the price of cover.
• Six week NHS wait option – some insurers offer an option where the policy will only pay for treatment if the waiting list on the NHS in your area is over six weeks.
• Increase your excess – just as with car insurance, a low excess will increase the cost of cover as it increases the proportion of the bill the insurer will have to pick up.
• Cap/remove outpatient cover – outpatient cover is any healthcare that doesn’t require an overnight stay in a hospital bed, such as therapies cover, blood tests and x-rays. It’s possible to cap outpatient cover or remove it entirely, leaving cover just for operations and other treatment requiring an overnight hospital stay.
• Remove ‘extras’ – the best PMI will cover more than a mid-range or basic plan, so you may want to consider trading down if you have a plan with a high level of coverage with lots of additional extras, such as optical and dental cover
• Strip back certain cover (provider dependent) – some policies will offer reduced cover for a lower price in certain areas, e.g. in cancer cover where the insurer will only pay out if the treatment you need isn’t covered by the NHS.