PMI - what do you need to know about Private Medical Insurance?

Do you have public health insurance with the NHS but want to improve your standard of treatment? Or is PMI the only form of insurance you may be entitled to? Whatever your answer, it is definitely worth finding out as much as you can about Private Medical Insurance.

PMI- Private Medical Insurance

What is PMI and why is it provided?

PMI, or private medical insurance, is a product offered by many companies on the UK market. In return for the premiums you pay, the insurer agrees to cover the costs associated with your treatment outside of the public medical system (NHS) . Private Medical Insurance can complement the services of the NHS by providing cover for the cost of prompt access to private treatment, and access to some drugs and services not always available on the NHS. If you don’t want to use the NHS, it can be very expensive to use private treatment without it – especially for serious conditions.

You can read more about PMI itself in theMoney helper article.

What does a PMI policy cover?

As with any insurance, the coverage and premium depends on a variety of factors, including the insurer itself.

Cheaper variants of PMI insurance cover the cost of in-patient treatments, for example operations and longer stays in the ward. If you plan to buy the extended insurance option, you will usually get access to consultations with specialists in offices.

Unfortunately, PMI usually does not cover:

• organ transplantations

• treatment of chronic illnesses that you had before purchasing the policy

• treatments related to a normal pregnancy and childbirth without complications

• aesthetic medicine treatments to improve your appearance

• treatment of injuries resulting from extreme sports

• treatment of injuries arising from war or similar conditions

• chronic diseases, such as HIV, AIDS, diabetes, epilepsy, hypertension and related illnesses.

Some packages do not cover mental health treatment or sports-related injuries, so when choosing PMI for yourself, it is worth checking the scope of the policy carefully.

How to get private insurance?

There are two ways to obtain PMI. The first is to get insurance through employee benefits. Some companies in the UK fund it completely, while others offer a subsidy. Since you’ve come across our blog, you’re probably planning to obtain insurance yourself. Where can you buy a policy?

• Directly from your insurer

• From a broker

• From a financial advisor

• At your bank

• At a building society

As a broker, we sincerely encourage you to use our services. A distinct advantage of this is the responsibility we take for any advice we give. If you are not yet sure how to choose an insurance broker, be sure to check out our article on this topic.

Which insurers offer PMI?

Competition in the insurance market is really high. Below you will find a list of the companies that offer Private Medical Insurance:

• BUPA

• CS healthcare

• AXA Healthcare

• Aviva

• The Exeter

• Vitality

• Freedom

• Guardian (dental insurance only)

• IMG

• National Friendly

• AIG

• WPA

Some people are under the illusion that because they are already using an offer from some insurer, such as Aviva, the offer on PMI will be just as good for them. If you’re deciding on a policy to protect your health, it’s worth going to a broker for an advice - the price differences between these products can run into hundreds of pounds a year.

Is PMI the same as critical illness insurance?

Some people may wonder whether Private Medical Insurance is the same as critical illness cover. While both products are concerned with human health, they are not substitutes, but rather supplements to each other. Critical illness insurance addresses those events that Private Medical Insurance very often does not cover, while the benefit payment is much more advantageous. The injured person gets cash and can use it for any purpose, whereas PMI money is only used to pay for private medical treatment.

How much does private health insurance cost?

For both insurance and mortgages, the universal answer is “it depends”. However, this does not mean that it is impossible to give at least approximate values. Below you will find sample amounts calculated for a 30-year-old single male non-smoker:

• Vitality: the insurer boasts that private medical care costs £1.25 a day with them, or £37.5 monthly. The basic package includes access to medical consultations within 48 hours of enrolment, psychotherapy, cancer treatment and physiotherapy. For more details, visit theVitality website.

• Aviva: according to an early January 2023 report, the most reduced package with this company costs £34 per month. For this price you will receive, among other things, treatment for cancers diagnosed after you have bought your policy, treatment in over 100 hospitals and emergency care. For more details, visit theAviva website.

• BUPA: according to the same report, BUPA offers a policy for £32 per month. The package includes, among other things: psychiatric care, post-hospital diagnostic tests, cancer therapies and stays at 3 networks of medical facilities. You can find a comparison of the basic and extended package on theinsurer’s website.

What affects the price of medical insurance?

Since you already know the sample costs of insurance policies, it is useful to know what is responsible for them. According to the late 2021 report, insurers pay attention to:

• Your age - the lower it is, the more favourable the premium for you

• Where you live. If you live in or near a city, your premium will be higher

• Smoking - if you are addicted to cigarettes, the insurer will claim a higher amount

• Your medical history

• Your claims history

• The way you pay your premiums - you can make transfers monthly or annually.

You could say that insurers create algorithms similar to a credit score. By analysing your risk of serious illness, they determine the amount they will agree to cover you for.

Is it possible to save money on PMI?

We have already mentioned that private health insurance is often offered as part of employee benefits. If you are a business and plan to purchase PMI, be sure to ask your accountant about the possibility of recognising this expense as a tax-deductible expense. You are likely to pay less tax as a result.

We hope you found our article helpful. Health insurance in the UK is important as the queues to see doctors are really long and premiums for private policies can be surprisingly low. We encourage you to read our other articles, e.g. how to choose an insurance broker.