Our Guide to Private Health Insurance and How It Works?


Ignatius Uirab

Money Savings Advice Private health insurance

Are you one of the many people looking towards private health insurance but not sure what you get and what it costs? The industry is huge, and there are so many different options; it can be difficult to know where to start. We will now take a look at what health insurance has to offer and what you need to be aware of.

In the early days of private health insurance, the policies were much simpler. As the cost of medical treatment continues to rise, and medical advances have led to improvements in life expectancy, private health insurance will only become more popular.

However, what do you get with your private health insurance cover?

Continue reading and get all the nitty-gritty details.

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What Is Private Health Insurance?

The best way to think of private health insurance is in a similar fashion to any other type of insurance you hold. You can either make monthly or annual premium payments which provide cover for private medical expenses while the policy is active.

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How Much Does Private Health Insurance Cost?

The cost of your private health insurance will depend upon your age, lifestyle, medical history and various other factors. It will also depend on the level of cover you require as there are various enhancements available.

As a ballpark figure, although every application would be different, some experts believe average private health insurance now costs anywhere between £1000 and £1500 per year.

Does Private Health Insurance Cover All Medical Conditions?

No. Basic private health insurance will cover short-term illnesses and injuries but not long-term/terminal conditions. There may be additions you can add to your policy that take into account other types of illness, but this is something you need to discuss when arranging your policy. In simple terms, the greater the level of cover required the higher your premiums.

Is It More Expensive to Pay Premiums Each Month?

As with traditional car insurance, it can be up to 30% cheaper to pay the cost of your annual cover in one payment. The exact figure will vary between different private health insurance companies, but you should expect to pay more if you pay monthly.

Will I Be Seen Immediately With Private Health Insurance?

Your first port of call will be your GP who will refer you to a consultant if required. At this point, you should contact your private health insurance company to check that they will cover the cost of the consultation and any potential medical treatment.

While it will depend upon the availability of the consultant in question, you should expect to be seen much quicker compared to NHS based treatment. It is worth noting that many private sector consultants also have NHS obligations so they may not be available at the drop of a hat.

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How Long Does Private Health Insurance Last?

Traditionally private health insurance is renewed every year - this also gives you the opportunity to shop around if you are able to find comparable cover at a cheaper price. It is, therefore, in the best interests of your private health insurer to work with you on the annual renewal date to offer the best terms possible.

If you find comparable cover at a cheaper rate, then it may be worth mentioning this to your existing insurer to see if they can match or better the terms.

Do Employers Offer Private Health Insurance?

Many employers now offer private health insurance as part of your employment package to attract and retain the best employees. The cover available will vary from employer to employer and the right to different types of health packages which are:-

Company Funded

Many companies will fund healthcare insurance premiums for their employees. Unfortunately, for tax purposes, these are treated as a “benefit in kind” and may attract a tax liability you will need to pay.

Voluntary Scheme

Some employers offer voluntary schemes which are funded by employees. However, due to the volume of business passed to insurers, they are often able to negotiate a significant discount on traditional rates. As you would be paying the premiums, there is no additional tax to pay.

Can I Arrange Family Private Health Insurance?

Yes. It is very simple to arrange private health insurance which is shaped around your individual family requirements. In general, the more members on your policy, the greater the discount, although the actual premiums would depend upon the level of cover required.

Family private health insurance offers peace of mind to parents and is a very competitive and active area of the market. It certainly pays to shop around!

Is There an Age Limit on Private Health Insurance?

The majority of private health insurance companies will have an age limit at which a new policy can begin. This can be as low as 65 years of age and as high as 75 years of age. Indeed, there are some specialist insurance companies out there who have no age limits.

It is worth bearing in mind, the older you are, the more chance of requiring medical attention and therefore you should expect higher premiums.

What Factors Impact Private Health Insurance Premiums?

There are many different factors to take into consideration, such as age, lifestyle, smoking habits, BMI and any pre-existing medical conditions. The cost of your insurance cover might also be impacted by your postcode with insurance companies often taking into account lifestyle and common medical conditions in your area.

Can I Extend the Term of My Private Health Insurance?

It is unlikely you would be able to extend your private health insurance cover beyond the 12-month renewal date. This ensures that your annual premiums going forward will reflect the real cost of medical treatment which has increased significantly in recent years.

Is Private Health Insurance Worth the Money?

In recent times we have seen an extension in some waiting times and restrictions on the range of treatments offered by the publicly funded NHS service. As a consequence, more and more people prefer the peace of mind which comes with private health insurance although there are obviously costs to take into account.


As the name suggests, private health insurance offers access to private healthcare facilities which can often help you to avoid long waiting times with the NHS. The cost and level of cover will depend upon your individual circumstances and budget. The industry is very flexible, very competitive and able to accommodate the vast majority of client requirements.

Quick Private Medical Insurance FAQs

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How Can Money Savings Advice Help You With Private Medical Insurance?

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.


Ignatius Uirab

Ignatius is one of our leading financial specialists. With over eight years of financial experience, he has vast experience and knowledge of the financial sector. When he is not writing about how to make your money go further, he is a true family man.

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