How to choose the right UK health insurance

HHealthcare is available free of charge on the NHS to most UK residents, but the number of people choosing to turn to private insurance for health problems has risen sharply, with 44% more people using insurer-provided insurance in 2021 healthcare services than in 2019 before the pandemic, the Association of British Insurers (ABI) said.

Part of this will have to do with the fact that NHS waiting lists are at a record high. Earlier this month it emerged that the number of people waiting longer than 18 months for NHS treatment in England is growing, despite ministers previously promising to eliminate such long waits.

If you’re interested in getting health insurance, make sure you get the right policy at the right price.

Know why you want it

What you need it for will determine what type of coverage you need.

“Some people are looking for quick access to healthcare, whether it’s a GP appointment or consular care, others want access to the latest innovations and treatments, and some want support to live healthier lives and reduce the chance of getting sick to reduce. Many are looking for all three,” says Dr. Keith Klintworth, director of VitalityHealth.

Sarah Coles, head of personal finance at investment platform Hargreaves Lansdown, says people will often use health insurance to avoid having to wait for treatment on the NHS or to get treatment or medication that isn’t available from the state.

Health insurance often covers medicines or treatments that people cannot access through the NHS because they are too new to be approved or because they are too expensive.

“Having quicker access to services and treatments often prevents health problems from worsening and is an important part of health insurance,” said a spokesperson for the Association of British Insurers.

One area that is becoming increasingly popular is the use of virtual GPs. The ABI says access to online GP appointments through health insurance increased by 440% between 2019 and 2021.

See what your employer offers

Health insurance as a condition of employment is likely to be a cheaper option, not only for you, but also for your family members – if the scheme allows it.

Because the schemes operate at scale, risks are dealt with differently. “There is typically less medical underwriting, meaning you are unlikely to need to declare pre-existing conditions,” says Gemma Milford, head of healthcare at IHC Employee Benefits.

Don’t just watch at the expense of

If you buy it yourself, the choice is huge: there are at least 500 private health insurers in Britain. Broadly speaking, Vitality’s premiums start at £38 per month, while Aviva says the average annual premium is around £1,000 to £1,100 – or roughly between £83 and £92 per month.

However, it doesn’t make sense to consider cost as the only factor when choosing a policy. After all, if it doesn’t do what you want, there’s no point in paying for it, so comparing policy details and premiums is crucial.

“As with all insurance, the premium is priced to reflect the risk. While it is up to individual insurers to set prices, a number of factors can be used to calculate a premium, including age, pre-existing health conditions and a person’s current health,” the ABI says.

Insurers often have different levels of coverage. “The more you pay, the more comprehensive the coverage,” says Coles.

“Always look for modular options,” says Milford. “In most cases, you can add and remove different coverage elements to get what suits you best and reduce costs.”

For example, you can often choose whether or not to include cancer. Or you can choose a policy that requires you to receive a diagnosis from the NHS but can then be treated privately. Some insurers will also offer a shortened list of treatment centers, which can also mean lower costs.

Increase your deductible

According to comparison site HealthWindow, adding a £200 excess to a policy could reduce premiums by 10%.

“Agreeing to pay a £500 excess means you are making a claim when you really need to,” says Milford. “You probably won’t use it for a series of physio appointments, but you will have it if you have a serious health problem.”

Don’t buy when you need it

“If you’re considering getting coverage because you have a bad knee and think you need treatment, for example, then it’s almost certainly a waste of money,” says Milford. “It is very unlikely that your policy will cover a problem you already have.”

Follow procedure – or you may not be covered

If you need to make a claim, it is essential that you know what to do every step of the way. This can be challenging if you are also dealing with health issues and facing a difficult diagnosis.

“You will probably need approval at each stage before treatment is arranged. For example, if you have been referred by a GP, you should call your insurer. If the private specialist then sees you and decides that you need treatment, you will need to call your insurer again. Don’t miss a single step or you may not be covered,” says Coles.

Take advantage of the daily discounts

Many insurers offer a range of frequently varying discounts to commercial partners. If they match things you normally use, they can partially offset your premium costs.

For example, Bupa offers 25% off an annual membership to English Heritage (usual cost: £69 per year for a family with one adult, or £120 for a family with two adults) and money off gym memberships.

Vitality has a range of discounts for all customers and other incentives based on their activity level. The more active you are, the more points you earn. You can use points to get discounts on smaller items, like movie tickets and coffee, all the way to Apple Watch and Fitbit products.

Vitality says it paid out more than £60 million in rewards and rebates last year, with committed members receiving more than 20% of their monthly premiums back in value. It also has a positive impact on members’ health: Vitality’s data shows that physically active members are up to 29% less likely to be hospitalized (and therefore less likely to make claims on their policy).

Weigh the ethics

The easiest way to save money on health insurance is not to buy it.

Muireann Quigley, professor of law, medicine and technology at the University of Birmingham, says that while “people should have the freedom to choose private care if they wish (through insurance, if they can afford it), and absolutely should to not have to wait for care in a system that is falling apart,” there is also an argument that increased use of private care could result in less pressure on the government to provide adequate, state-supported services.

“While everyone suffers in this scenario, like all similar cases, it affects those who can least afford it, exacerbating existing health and other inequities.”

Coles says health insurance is a choice. “Some people will be against it because they believe healthcare should be the same for everyone. Others will believe that if there is anything worth spending money on, it is their health.”