Private medical insurance… am I really getting the best deal from my insurer?

Oct 31, 2018 | Tony Byrne's View

Private medical insurance. One of those things you’re relieved you’ve got when you need it, and regularly re-consider when you don’t. I have had private medical insurance for the last 25 years but have only made a serious claim under a policy twice; once for a torn Achilles’ tendon last year, and once for skin tags about 15 years ago. In each case it was a godsend at the time, but I was seriously unhappy when my insurer, AXA, decided to increase my premium by nearly 100% on renewal last year! What on earth was going on?

The thing is, I had always thought that insurance premiums were calculated on a pooled risk basis; that the premium calculations were based on claims made by the collective group of policyholders rather than by each individual. To my frustration, however, I discovered that with some companies this isn’t the case. And it was at that moment I decided to re-broke my policy to another insurer. I chose Alpha UK, which does operate on a pooled risk basis, and to my delight I saw my premiums return to their pre-claim level with my previous insurer, AXA.

But overall is it worth it?

We all have a different attitude to risk, and gambling on our health is no different. It’s true that you may never need private medical insurance, however, when you do… it matters. The NHS is an amazing system, I have no wish to knock it, but you do get treated far more quickly when you opt to go privately than with the NHS; it’s just one of those things. I made the decision to have private medical insurance all those years ago for precisely that reason. As a business owner I felt it was imperative to be able to return to work as quickly as possible after an illness or injury. And though I’ve only made two claims to date, I have never once regretted having private medical insurance. It’s given me great peace of mind knowing I have a policy to cover me in the event of ill health. And, I confess, on each occasion it was like staying in a hotel. The patient service was excellent, the equipment and environment were top class, and the staff were second to none.

Can it work for a small business?

There is only one way I can answer that… absolutely! I attended a Chamber of Commerce event recently that focused on the benefits the Chamber offers to members. Interestingly, one of the speakers presented specifically on private medical insurance. She explained that member businesses are entitled to a 50% discount on their premiums for the first 3 years. And on top of that, the premiums are initially discounted for Chamber members anyway; including those for small firms. How could this be so? Because the Chamber membership is treated as one large group, much like a large company scheme. The pooling effect kicks in.

You can imagine how pleased I was to discover that the cost of insuring my entire team of 8 staff, including me, would actually only be 3 times the cost of insuring myself individually. And you can imagine my increased delight when I then also discovered that I can reduce my premiums even further by using a specialist private medical broker; who in addition would find me the best cover and policy terms for my circumstances. It will come as no surprise to you that I wasted no time in agreeing to proceed, and I now have an EVEN happier team working with me.

Overall, therefore, there are a number of ways in which you personally can, or your business can, benefit from private medical insurance, plus potentially enjoy a reduction in cost. If you would like further advice on the subject or any other financial matter do contact us. You know it makes sense.

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