I want to understand the ways in which I can reduce my monthly premiums on my Private Medical Insurance plan. The only one I have thought of is adding an excess to the policy.
- Andrew Jenkinson
Thanks for your question. You are correct, adding an excess is a common way of reducing your health insurance premiums below are a number of other ways which can help you contain costs.
Level of Outpatient Cover
The vast majority of Private Medical Insurance (PMI) products will provide cover for inpatient treatment in full (i.e. where a stay in hospital is required).
It is in the level of outpatient treatment that the premiums can differ significantly as claims are more frequent.
Outpatient treatment includes any scans, tests or specialist consultations where a stay in hospital is not required.
The three options tend to be no outpatient treatment, a level of outpatient treatment capped at a monetary limit i.e. £1,000 per policy year or covering outpatient treatment in full.
Naturally the greater the level of outpatient cover provided the higher you monthly premiums.
Often an additional option which can be selected which covers treatments such as osteopathy and chiropody. Given the nature of these treatments claims can be quite common and including such cover can increase your premium by as much as 10%.
- Psychiatric Cover
An additional option which can often be included in a Private Health Insurance plan. However, the cost of treatment can be expensive and drawn out and thus can add another 5-10% to your monthly premiums.
6 Week Wait Option
The 6 week wait option was introduced into the PMI market to provide a more affordable option to individuals who were priced out of the market.
With the 6 week wait option the policyholder agrees to receive treatment via the NHS should the waiting list for treatment of their condition be less than 6 weeks.
Should the NHS waiting list be more than 6 weeks, the policyholder is eligible to receive treatment privately immediately. By opting for the 6 week wait option premiums can reduce by as much as a third.
The 6 week NHS wait only applies to inpatient care (i.e. all care requiring the use of a hospital bed), not outpatient care.
If you’ve opted for outpatient care on your policy, this will allow you to be seen privately as soon as possible for all outpatient diagnostic tests / scans. The 6 week NHS wait only kicks in after it becomes apparent you need inpatient care.
Most insurers offer a standard hospital list which covers a wide range of hospitals throughout the UK.
However, there are then options to either extend or reduce that hospital list depending on your requirements.
Options to reduce the hospital list can often include a local hospital list limiting the hospitals in which treatment can be receive. Some insurers go as far as offering hospital lists which limit you to private wings of NHS hospitals.
With all of these options it is important to understand the cover provided by each and the cost of that particular benefit before making any decisions on altering cover to reduce your monthly premiums.
For further information please see our page Options to reduce health cover premiums: Low Cost Health Insurance
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