Personal Finance and Healthcare Expert
If you're reading this post, you're likely already aware of the numerous benefits of private medical insurance, not least the speedy access to private treatment when you need it. However, one of the most significant drawbacks, especially for those approaching retirement and beyond, is that premiums sharply rise as you age. Read on to learn about the best ways to reduce the cost of your policy.
The first suggestion we make is to review your policy regularly, every year if possible. With the cost of policies rising on average 44% between your 50th and 60th birthdays and then another 59% between your 60th and 70th, the single most important thing you can do is regularly shop around.
Indeed, the FCA themselves recommend that this should be an annual exercise, as does Martin Lewis' team over at Money Saving Expert. While sticking with your current insurer is often the easiest option, it's usually not the most wallet-friendly.
Health insurance in the UK is a competitive market, and all of the best health insurers frequently run incentives to attract new customers. By comparing the market, you ensure that you always have the best policy for the best price available.
A knowledgeable and competent agent dealt with my health insurance needs. She saved me £600 per month by finding a quote more suited to my needs and budget than my previous company.
Often, your insurer's initial renewal price isn't the best they can do. If you don't haggle, you're missing the opportunity to save money. If this becomes a recurring theme, and you don't ever question the price, the increases will be compounded year after year.
To give yourself the best footing to haggle with your insurer, it's helpful to get a comparison quote first so that you can tell them the price you'd get elsewhere if you switched.
The next option to reduce the cost of your policy without significantly affecting your cover is to increase the amount you're willing to contribute towards treatments. Increasing your excess minimises the risk for your insurer and, therefore, the cost of the policy.
When we're all a bit younger, we typically go for most of the additional options a health insurance policy offers. So, for example, routine dental cover, mental health cover, and even travel cover. However, as you get older, each of these options adds to the overall cost of your policy. If you primarily have health insurance to protect you from severe medical conditions, you could remove some additional options to reduce your renewal premiums.
A relatively new concept for health insurance in the UK is called "guided consultants". You agree to use a specific pool of consultants that your insurer has pre-selected in return for reducing your premiums. We recently researched the cost of health insurance in the UK, and found that opting for a policy with guided consultants reduces your premium by 20% on average.
Of course, you need to bear in mind that you're effectively reducing your coverage, as you won't be able to access all specialists and consultants in the UK. However, if your policy is getting expensive and you need to find other ways to reduce the cost without sacrificing too much cover, it could be a good option.
The hospital list you've selected on your policy significantly affects the cost. If, for instance, you have hospitals in Central London included but can't see yourself ever needing to use them, switching to a national hospital list or even a local one could be an excellent way to save some additional money.
Having outpatient cover puts the cost of your health insurance policy up significantly, not least because it brings significant benefits. The thing with outpatient cover is that you're far more likely to claim for diagnostic tests, scans and physiotherapy than serious medical treatment where inpatient admission is required. Therefore, having unlimited outpatient cover comes at a high cost.
The first option is to reduce the amount of cover you have, which alone will bring your policy's cost down. In a worst-case scenario, and if you're keen to be covered for the most serious conditions but can't afford the policy, removing outpatient cover altogether could be an option. Again, this is something to carefully consider and discuss with your health insurance broker when you get a comparison quote, as you will be reducing your coverage.
The final suggestion we have is to add a 6-week NHS wait option to your policy. This isn't something we tend to recommend too frequently. Having it tends to undermine a significant number of health insurance benefits. However, it is a good way to reduce the cost of a policy. By adding a 6-week NHS wait option, you commit that if you can be treated within 6-weeks by the NHS, you'll go that route; however, if it's going to be longer than that, you'll receive treatment privately.
Disclaimer: This information is general and what is best for you will depend on your personal circumstances. Please speak with a financial adviser or do your own research before making a decision.
Kirsty is a personal finance and healthcare expert who enjoys demystifying legal and insurance topics for a wider audience. She’s a former solicitor with a personal injury and insurance background.
Based on extensive research carried out in 2024, the average price of health insurance for a 50-year-old in the UK is £60 per month for basic cover and £88 for comprehensive cover.
Based on extensive research carried out in 2024, the average price of health insurance for a 60-year-old in the UK is £87 per month for basic cover and £127 for comprehensive cover.
Based on extensive research carried out in February 2022, the average price of health insurance for a 60-year-old in the UK is £141 per month for basic cover and £203 for comprehensive cover.
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*Based on 461 quotes between 01/22-01/23
