Are you one of the many people in the UK looking towards private health insurance but don’t know where to start or what you should be looking for? You are not alone! Many people are now turning towards private health insurance brokers who can offer advice and guidance to ensure that you get the best cover for your situation.
In the early days, the private health insurance sector was relatively straightforward, with a small number of major providers. The situation has changed dramatically in recent years, and there are now general insurers and specialist insurers.
The role of private health insurance brokers is often misunderstood, and we will now cover the more common frequently asked questions.
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The role of a private health insurance broker is relatively simple; they will find the best health insurance cover for your situation and your budget. The situation becomes a little more complex when you consider independent brokers and tied brokers, but ultimately a broker is charged with finding you the best deal.
As the term suggests, an independent private health insurance broker is not tied to a relatively small number of insurance companies and can deal with anybody in the market. This can be especially useful when new entrants arrive in the market, often offering complimentary rates to attract new business.
In theory, but not always in practice, you would expect an independent private health insurance broker to negotiate better terms than a tied broker.
A tied private health insurance broker is only able to deal with a relatively small number of insurance companies with which they will likely have a strong relationship. While many people automatically assume that tied insurance brokers have less scope to find the best deal for you when compared to independent brokers, this is not always the case.
As they are pushing potentially large volumes of business to a small number of insurance companies, they may have scope to negotiate significant discounts. As a consequence, they may be able to match or even better quotes provided by an independent broker.
Yes. It is all good and well looking through the Internet, checking hundreds of different policies, but what about the terms and conditions, what about the small print? On occasion, you will find health insurance policies which look “too good to be true” only to find that the small print is restrictive and limits your access to cover.
Private health insurance brokers have experience, contacts and know exactly what to look for both with the headline figures and small print. Can you imagine taking out a policy only to find that there are restrictions that you were not aware of?
There are three basic ways in which insurance brokers earn income which are:-
In years gone by the commission earned by insurance, brokers were often shrouded in mystery, but now they have a legal obligation to be transparent about their relationships and income from third parties.
As health insurance is a relatively competitive area of the market, you will find that some health insurance companies will pay double-digit commission to brokers who channel business their way. There is very often a renewal commission, which is much less than the initial commission rate, which is paid annually as and when policies are renewed.
It is very important to mention commission/charges when discussing your requirements with your health insurance broker. You need to know where you stand!
It is only natural to wonder whether health insurance brokers are influenced by the rates of commission paid by health insurance providers. In reality, if a broker was simply funnelling business to insurance companies paying a high commission, not putting the client first, they would be found out. It is worth remembering that there may be situations where the highest commission rates come from those providing the best health insurance services.
The Internet has assisted with many areas of business, one of which is feedback which can have a very positive or a detrimental impact on individual businesses.
As we touched on above, whether using an independent broker or a tied broker, there is every chance they will be able to arrange a significant discount on publicly listed premium rates. Therefore, it is not inconceivable that even taking into account charges/commission; you may be able to find a cheaper and often much better deal through an insurance broker.
That said it is not always about the price because it is just as important/more important than the policy itself is structured around your exact requirements. Sometimes you may end up comparing apples and pears with regard to different policies offering different levels/types of service.
There are some health insurance companies who will consider limited/restricted cover for pre-existing conditions, but they can be few and far between. Therefore, using the services of a health insurance broker could prove very fruitful.
Not only will they have contacts in the marketplace, but they will also be able to explain the small print and any limited/restricted cover. This kind of advice can be priceless!
If you work with a private health insurance broker, they will check the market as your renewal date approaches to see whether there are any better offers available. It is not advisable to just automatically renew your health insurance policy each year.
Whether a private health insurance broker receives a commission from an insurance company, clients or a mixture of the two, they certainly have a very important role to play. Very often, they will be able to negotiate discounted rates due to their close relations with various health insurance companies.
As the market becomes more and more competitive, the role of health insurance brokers will become more important.
Here at Money Savings Advice, we have partnered with some of the UK’s leading Private Medical Insurance companies. They have already helped thousands of people get the best PMI cover, and, they can do the same for you.
Choosing an independent adviser means they won’t recommend a policy unless they are sure it is in your best interests. Their advice is also regulated by the FCA, which gives you an additional layer of protection.
If you would like to speak to one of these brokers, then click on the below and answer the very simple questions.
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