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Group Private Medical Insurance: The Good, The Bad and The Pricing

Group Private Medical Insurance: The Good, The Bad And The Pricing

Group Private Medical Insurance is the most commonly used term for this product, but like other products goes by alternative names such as business health insurance, employee medical cover, company health insurance or company healthcare insurance.

Today, we are going to have a look at why group private medical insurance is viewed as the most desired employee benefit by employees.

The Good

Business Health Insurance provides your employees with access to private healthcare which will ensure they are receiving the best treatment available, in a more timely manner than on the NHS and in return will help them be fit to return to work sooner.

  • Employees will have their medical bills covered if they receive private treatment for acute conditions or anything else covered in their policy.
  • The NHS is a wonderful thing, but is unfortunately underfunded, causing delays when receiving treatment. Employees that are covered by private medical will benefit from skipping lengthy waiting lists to receive the best care available.
  • If choosing ‘medical history disregarded’, your employees will benefit from having their pre-existing conditions ignored, so there are no exclusions for them to worry about for previous issues.
  • Premiums are treated as an allowable business expenses so as an employer you will benefit from tax relief against the premiums.

Personally, we feel the NHS is one of the things that makes us proud to be British and is something as a company, we are forever grateful for.

Unfortunately, there is no hiding the fact that it is massively underfunded and sadly abused by a small minority of people (the fact that up until May 2018 people could claim a 95p box of paracetamol costing the NHS £34, is mind boggling).

We totally understand with the NHS being as stretched as it is, when you’re in dire need of care, private cover is going to be the first choice for you and your loved ones.

Constantly, we see more and more reports from the health standards watchdog of the NHS, ‘straining at the seams’, it sees no sign of slowing down.

We are going to continue to see business health insurance maintain the number one spot on employees’ benefit Wishlist’s.

The Bad

Employees may be hoping that business medical insurance will be the next on the list for their employee benefit plan, but do they know the negatives of the product as these obviously aren’t promoted by employee benefits brokers, but need to be known when arranging staff benefits as this might be overlooked.

As we mentioned, a great part of being in the UK is the NHS. Employees tend to overlook the fact that they could potentially get much better care on the NHS.

If we consider the fact that the three biggest killers in the UK are Cancer, Heart disease and strokes which are also the three main illnesses that will get you priority NHS care and that NHS hospital can be better than private hospitals as they see the highest number of these cases.

That being said, is private the way to go? Especially as heart attacks and strokes will require more immediate care and you will be rushed to an NHS hospital, is something else staff likely forget.

Don’t get us wrong, we think private medical insurance is a fantastic benefit if your employees require specialist treatment, but companies need to educate their employees that chronic illnesses aren’t covered by most insurers. Conditions such as Alzheimer’s, dementia, asthma, diabetes, mood disorders or even potentially cancer may not be covered under the policy.

We understand insurers can’t cover every illness or disease otherwise the policies wouldn’t be sustainable, but we have a duty of care to ensure employees are aware of this when choosing what benefit is the most desirable.

The Pricing

Fortunately, our business specialises in the healthcare industry and have picked up a few helpful hints to consider when planning your budget for Group Private Medical Insurance:

How many employees: We see several companies just insuring the directors or senior staff. We understand budgets are tight and you may only want to reward the most long-term and loyal staff, but this might not always be the right thing to do.

If you look to open the benefit up to the entire work force it may decrease the average age of the group and the weighted premiums (high benefits for high earners) which can reduce the premiums for your company policy.

Underwriting requirements: Certain requirements for underwriting will of course impact the price. If we take ‘medical history disregarded’ for example, this will waive all of your staff’s prior health history.

Now this will of course impact the premium as the insurer could be taking on the risk of covering people with serious existing health conditions.

What industry you’re in: If we look at the UK workforce as a whole, we have lots of weird and wonderful companies and industries. Now of course certain industries are going to be more of a worry for insurers than others.

If we break this down to basics and look at the example of an office worker vs a construction worker who were both in identical serious road traffic accidents, and both requiring long term physiotherapy.

We can deduce that it would be very likely the office worker would be able to return to work before the construction worker as they do not have the physical aspect to their role, hence they would have a shorter recovery time, potentially paying out less benefit.

Our main tip would be to sit down with an employee benefits broker (obviously us as your first choice) and discuss your company. As always, it’s not one size fits all!

If your employees are asking about business health insurance, then why not call us on 01273 222805 or visit our group private medical insurance page for more helpful hints.

Charlie Cousins

Founder and Director of Hooray Health & Protection, Charlie Cousins has enjoyed a career in the insurance and financial services industry spanning over the last ten years.

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