UK Health Insurance: Excess & Co-Pay Guide

Mastering Your UK Private Health Insurance: Navigate Excess & Co-Payments for Optimal Value & Affordability

UK Private Health Insurance: Navigating Excess & Co-Payment for Optimal Value & Affordability

In an increasingly unpredictable world, the peace of mind offered by private health insurance (PMI) has become invaluable for many in the UK. With NHS waiting lists stretching and demand for healthcare services at an all-time high, the appeal of faster access to specialists, choice of hospitals, and comfortable private facilities is undeniable. However, the perceived cost of private medical cover often deters individuals and families. This comprehensive guide aims to demystify two critical mechanisms – excess and co-payment – that can significantly influence the affordability and value of your UK private health insurance policy.

Understanding how these elements work isn't just about saving money; it's about tailoring a policy that genuinely meets your needs without compromising your financial well-being. From fixed sums to percentage contributions, we'll delve into the intricacies of these cost-sharing features, providing you with the knowledge to make an informed decision for optimal health coverage.

Understanding the Landscape of UK Private Health Insurance (PMI)

Private health insurance in the UK is designed to cover the costs of private medical treatment for acute conditions that arise after your policy begins. This means conditions that are sudden, severe, and curable. PMI offers a valuable alternative to relying solely on the National Health Service (NHS), providing benefits such as:

• Faster Access: Reduced waiting times for consultations, diagnostic tests, and treatments.
• Choice of Care: The ability to choose your consultant, hospital, and often the timing of your treatment.
• Comfort and Privacy: Private rooms, flexible visiting hours, and a generally more comfortable hospital environment.
• Specialist Referrals: Direct access to a wide network of specialists for diagnosis and treatment.

While PMI offers significant advantages, it's crucial to understand its limitations. It does not typically cover chronic conditions (long-term, incurable conditions like diabetes, asthma, or hypertension), pre-existing medical conditions (any illness, injury, or symptom you had before taking out your policy), or routine maternity care, emergency services, or cosmetic surgery. These exclusions are standard across the industry, and it's vital not to misinterpret the scope of cover.

The demand for PMI has seen a notable increase in recent years. According to LaingBuisson's UK Health & Protection Market Report 2023, the number of individuals covered by PMI in the UK reached 7.35 million in 2022, the highest level on record. This growth is testament to growing awareness and the desire for greater control over healthcare, often driven by the immense pressures facing the NHS. For instance, NHS England data consistently shows millions of people on waiting lists for elective care, highlighting the urgency for many to seek private alternatives.

The Core Components of PMI Costs

When you consider a private health insurance policy, several factors determine the premium you pay:

• Your Age: Premiums generally increase with age, reflecting the higher likelihood of needing medical treatment.
• Your Location: Healthcare costs can vary significantly across the UK, with urban areas often being more expensive.
• Your Chosen Level of Cover: The more comprehensive your policy (e.g., covering out-patient treatment, mental health support, therapies), the higher the premium.
• Your Lifestyle: Habits like smoking can increase premiums.
• Underwriting Method: The way your medical history is assessed.
  • Moratorium Underwriting: Common for speed and simplicity. The insurer doesn't ask for a full medical history upfront. Instead, they apply a waiting period (e.g., 2 years) during which pre-existing conditions may not be covered. If you go 2 years without symptoms, the condition may then be covered.
  • Full Medical Underwriting (FMU): Requires you to disclose your full medical history at the application stage. The insurer then applies specific exclusions for any declared pre-existing conditions. This provides certainty from the outset about what is and isn't covered.
  • Continued Personal Medical Exclusions (CPME): Used when transferring from one insurer to another, allowing you to maintain the same underwriting terms and exclusions.

Beyond the premium, private health insurance policies often incorporate cost-sharing mechanisms to help manage affordability and reduce monthly outgoings. These are primarily excess and co-payment. Understanding these elements is crucial for balancing cost and comprehensive coverage.

Demystifying Excess in UK Private Health Insurance

An 'excess' in private health insurance is a fixed monetary amount that you agree to pay towards the cost of your treatment before your insurer contributes. Think of it as the initial portion of a claim that comes directly from your pocket. By accepting an excess, you take on a small portion of the financial risk, and in return, the insurer typically offers a lower annual premium.

How Does Excess Work?

The application of an excess can vary:

• Per Claim Basis: This is the most common approach. You pay the excess each time you make a new claim for a different condition or a recurrence of a previous condition. For example, if you claim for knee surgery in March and then for a gallstone removal in October, you'd pay the excess twice.
• Per Policy Year Basis: Less common, but some policies may apply the excess only once per policy year, regardless of the number of claims you make within that period. This offers more predictability if you anticipate multiple claims.

Common Excess Levels

In the UK, common excess levels offered by insurers typically range from:

• £0 (no excess)
• £100
• £250
• £500
• £1,000
• Sometimes even higher, such as £2,500 or £5,000 for those seeking significant premium reductions.

Benefits of Choosing a Higher Excess

The primary benefit of opting for a higher excess is a lower monthly or annual premium. This makes private health insurance more accessible and affordable, especially for those on a tighter budget. For individuals who are generally healthy and only expect to make a claim infrequently, a higher excess can be a very cost-effective choice. It means you're covered for significant, unexpected medical events without paying a premium that reflects coverage for every minor ailment.

Drawbacks of a Higher Excess

The main drawback is the out-of-pocket expense you incur when you do need to claim. If you choose a £1,000 excess and then need an operation costing £5,000, you will be responsible for the first £1,000, and your insurer will cover the remaining £4,000. It's essential to ensure you have readily available funds to cover your chosen excess should the need arise.

When a Higher Excess Makes Sense

• You're generally healthy: If you rarely visit a doctor and don't anticipate frequent claims for acute conditions.
• You have an emergency fund: You have savings put aside that can comfortably cover your chosen excess amount.
• You prioritise lower monthly premiums: You want the peace of mind of cover for major health events, but affordability is your primary concern.

When a Lower (or No) Excess is Preferable

• You anticipate frequent claims: If you have certain acute, but not chronic, conditions that may require occasional treatment, a lower excess might save you money in the long run.
• You prefer budget certainty: Knowing that most of your medical costs will be covered by the insurer offers greater peace of mind.
• You have limited emergency funds: You might struggle to cover a large out-of-pocket sum if a claim arises unexpectedly.

Illustrative Table: Premium Savings with Higher Excess

Let's look at a hypothetical example of how choosing a higher excess can impact your annual premium. (Please note these figures are illustrative and will vary significantly based on age, location, insurer, and cover level).

Scenario Example: The Impact of Excess

Imagine Sarah, 45, is considering PMI.

• Option A: No excess, premium £1,500 annually.
• Option B: £500 excess, premium £1,150 annually.

If Sarah chooses Option B, she saves £350 on her premium. However, if she needs a knee operation costing £6,000:

• Under Option A: Insurer pays £6,000. Sarah pays £0 out of pocket for the claim.
• Under Option B: Sarah pays the £500 excess, insurer pays £5,500. Sarah's total out-of-pocket cost for the year would be the £1,150 premium + £500 excess = £1,650. Compared to Option A's total cost of £1,500, Option B would cost her £150 more in total that year, but she had the benefit of lower premiums until a claim arose. If she makes no claim, she saves £350. This highlights the balance between premium savings and potential out-of-pocket costs.

Unpacking Co-Payment (or Co-Insurance) in UK Private Health Insurance

While excess is a fixed sum, co-payment (sometimes referred to as co-insurance in a UK context, though less common than in the US) is a percentage of the claim cost that you, the policyholder, agree to pay. It’s a mechanism that shares the financial burden of treatment between you and your insurer.

How Does Co-Payment Work?

Co-payment typically applies after any excess has been met. This means you pay your fixed excess first, and then a percentage of the remaining eligible treatment costs.

For example, if you have a £250 excess and a 20% co-payment, and your treatment costs £5,000:

1. You pay the £250 excess.
2. The remaining cost is £5,000 - £250 = £4,750.
3. Your 20% co-payment on £4,750 is £950.
4. Your total out-of-pocket cost for this claim would be £250 (excess) + £950 (co-payment) = £1,200.
5. The insurer pays the remaining £3,800.

Common co-payment percentages range from 10% to 30%, though some insurers may offer different options.

Benefits of Co-Payment

The most significant advantage of opting for a co-payment clause is the substantial reduction in your premium. By taking on a percentage of the risk for large claims, you signal to the insurer that you're willing to share responsibility, which significantly lowers their potential payout for any single claim. This can make otherwise unaffordable comprehensive policies accessible.

Drawbacks of Co-Payment

The primary drawback of co-payment is the uncertainty of your total out-of-pocket expense. Unlike a fixed excess, a co-payment amount can escalate quickly with high-value treatments. If you face a claim for a complex surgery costing £20,000, a 20% co-payment would mean you pay £4,000 (after any excess), which could be a significant unexpected expense.

It's also worth noting that in the UK, unlike some US health insurance plans, policies typically do not include an "out-of-pocket maximum" that caps your annual co-payment liability. Each claim's co-payment is generally calculated independently, meaning there's no ceiling on the total co-payment you might incur over a policy year if you make multiple large claims.

When Co-Payment Makes Sense

• You prioritise the lowest possible premium: If your budget for monthly premiums is extremely tight, co-payment can unlock access to private cover.
• You have substantial emergency savings: You are financially prepared to cover a potentially large percentage of a significant medical bill.
• You have a low perceived risk of major claims: You believe you are unlikely to need very expensive treatments.

When to Avoid Co-Payment

• You desire predictability and budget certainty: You prefer knowing your maximum out-of-pocket cost upfront.
• You have limited emergency funds: An unexpected large medical bill could cause significant financial strain.
• You anticipate potentially high-cost treatments: If you are concerned about needing expensive interventions for acute conditions, the co-payment could become very costly.

Illustrative Table: Premium Savings with Co-Payment

(Again, these figures are illustrative and will vary significantly based on individual circumstances.)

Scenario Example: The Impact of Co-Payment

John, 55, is healthy but wants peace of mind.

• Option A: No co-payment, premium £1,500 annually.
• Option B: 20% co-payment, premium £1,100 annually.

John chooses Option B, saving £400 on his premium. Six months later, he needs an acute appendectomy costing £4,000.

• Under Option A: Insurer pays £4,000. John pays £0 out of pocket for the claim.
• Under Option B: John pays 20% of £4,000 = £800. Insurer pays £3,200. John's total out-of-pocket cost for the year would be the £1,100 premium + £800 co-payment = £1,900. In this case, Option B costs him £400 more in total that year, but had he not claimed, he would have saved £400. This starkly shows the trade-off.

Strategic Combination: Excess and Co-Payment Together

Some insurers allow you to combine both an excess and a co-payment on your policy. This approach offers the maximum potential for premium reduction but also carries the highest potential out-of-pocket costs when a claim is made.

How They Interact

When both are applied, the process typically follows this order:

1. Excess is paid first: You contribute the fixed excess amount.
2. Co-payment is calculated on the remainder: The agreed percentage co-payment is then applied to the remaining cost of the eligible treatment.

Example: £500 Excess + 20% Co-payment on a £10,000 Claim

Let's break down a larger claim scenario:

• Total treatment cost: £10,000
• Your agreed excess: £500
• Your agreed co-payment: 20%

1. You pay the £500 excess.
2. Remaining cost for co-payment calculation: £10,000 - £500 = £9,500.
3. Your 20% co-payment on £9,500: 0.20 * £9,500 = £1,900.
4. Your total out-of-pocket cost for this claim: £500 (excess) + £1,900 (co-payment) = £2,400.
5. The insurer covers the remaining: £10,000 - £2,400 = £7,600.

Advantages of Combining

• Maximum Premium Reduction: This combination typically results in the lowest possible premium for a given level of cover, making comprehensive PMI much more affordable on a monthly basis.
• Accessibility for Budget-Conscious Individuals: It opens up private healthcare to those who might otherwise deem it too expensive.

Disadvantages of Combining

• Highest Potential Out-of-Pocket Costs: Should you need significant or multiple treatments, your financial contribution can become substantial and unpredictable.
• Complexity: Understanding the total cost can be more challenging than with just a fixed excess.

Who Benefits Most from This Combination?

This approach is best suited for individuals or families who:

• Are young and generally in excellent health: They anticipate very few claims for acute conditions.
• Have substantial savings or an emergency fund: They are financially robust enough to absorb potentially large out-of-pocket costs without distress.
• Have a high risk tolerance: They are comfortable with the uncertainty of future medical expenses in exchange for lower regular payments.
• Prioritise the lowest possible monthly premium above all else.

Table: Comparing Different Cost-Sharing Combinations

This table illustrates the varying impacts on premiums and potential out-of-pocket costs for a hypothetical £5,000 claim, assuming a base premium of £1,500 with no excess or co-payment.

Note: In scenarios where you do not claim, the 'Total Annual Cost' would simply be the 'Indicative Annual Premium'. This table highlights the trade-off when a claim occurs. The combined option always offers the lowest premium but potentially the highest out-of-pocket cost during a claim.

Making the Right Choice: Factors to Consider for Optimal Value

Deciding on the ideal excess and co-payment structure for your UK private health insurance isn't a one-size-fits-all solution. It requires a thoughtful evaluation of your personal circumstances, financial health, and attitude towards risk. Here are the key factors to consider:

1. Your Budget and Financial Health

• What can you realistically afford for premiums? Be honest about your disposable income for monthly or annual payments.
• How much cash do you have readily available? Can you comfortably cover a £500, £1,000, or even £2,000+ excess or co-payment if an acute condition requires treatment tomorrow? Access to an emergency fund is crucial if you opt for higher cost-sharing.

2. Your Current Health Status and History

• How often do you visit a doctor for acute, new conditions? If you rarely need medical intervention beyond routine check-ups (which aren't covered by PMI anyway), a higher excess might be suitable.
• Family Medical History: While pre-existing conditions are generally excluded, understanding your family's history might give you an indication of potential future acute health concerns you may develop (e.g., if certain acute conditions run in your family).

3. Frequency of Expected Claims

• If you anticipate needing to make multiple small claims for various acute conditions within a policy year, a policy with a "per policy year" excess might be more economical than a "per claim" excess, or a lower excess overall.
• If you're only concerned about covering major, one-off acute medical emergencies, a higher excess or co-payment could be more cost-effective.

4. Your Risk Tolerance

• Are you comfortable with financial uncertainty? If you're highly risk-averse and prefer to know your exact out-of-pocket expenses for any medical event, a lower excess and no co-payment are preferable, even if it means higher premiums.
• Are you willing to take a calculated risk for lower premiums? If you're comfortable paying a larger sum only if you claim, then higher cost-sharing options could be a good fit.

5. Your Age and Life Stage

• Younger individuals often benefit most from higher excess/co-payment options as their premiums are generally lower, and they are statistically less likely to make large claims.
• As you age, premiums increase significantly. Opting for a higher excess or co-payment might be the only way to keep PMI affordable, even if your likelihood of claiming increases.
• Families with young children might want to balance lower premiums with a manageable excess, as children can have unpredictable acute health needs.

6. NHS Pressures in Your Area

• While PMI offers private treatment, the urgency to use it can be influenced by local NHS waiting times. If NHS waits in your region are exceptionally long, you might place a higher value on immediate private access, potentially influencing your willingness to accept higher cost-sharing for the premium savings.

7. The 'What if' Scenario Exercise

It's incredibly helpful to run through hypothetical situations:

• "What if I need a £5,000 operation?"
• "What if I have two separate acute conditions in one year, each costing £3,000?"

Calculate your total out-of-pocket cost (premium + excess + co-payment) for different scenarios with various excess and co-payment configurations. This practical exercise can clearly highlight the financial implications of your choices.

Beyond Excess and Co-Payment: Other Ways to Control PMI Costs

While excess and co-payment are powerful tools for managing your premium, several other factors influence the cost of your UK private health insurance. Being aware of these can help you further tailor your policy for optimal value.

1. Level of Cover

This is perhaps the most significant determinant of your premium after age. Policies typically offer various tiers:

• In-patient Only: Covers treatment requiring an overnight stay in hospital. This is the most basic and cheapest option.
• In-patient and Out-patient: Adds cover for consultations, diagnostic tests (e.g., MRI scans, blood tests), and day-case treatments where you don't stay overnight. This is more comprehensive but also more expensive.
• Comprehensive: May include therapies (physiotherapy, chiropractic), mental health support, cancer care, home nursing, and sometimes even dental and optical cover (though these are often optional add-ons).

Cost-Saving Strategy: Consider if you genuinely need the most comprehensive cover. If you're comfortable using the NHS for out-patient diagnostics or therapy, an in-patient only policy will be considerably cheaper.

2. Hospital Lists

Insurers often offer different hospital lists:

• Full National List: Access to virtually all private hospitals and facilities across the UK. This is the most expensive option.
• Restricted List/Guided Options: A smaller network of hospitals, often excluding those in central London or more expensive facilities. This is a cheaper option.

Cost-Saving Strategy: If you're comfortable with a more limited choice of hospitals, especially outside major city centres, choosing a restricted list can reduce your premium.

3. The 6-Week Option (or NHS Pledge)

Many insurers offer a "6-week option" or "NHS pledge" discount. This means that if the NHS can provide the required acute treatment within six weeks, you agree to have it on the NHS. If the wait is longer than six weeks, your private cover kicks in.

Cost-Saving Strategy: This option can significantly reduce your premium, often by 10-20%. It's a good choice if you're willing to wait a short period for non-urgent treatment but want the assurance of private care if NHS waits are excessive.

4. Underwriting Choices

As mentioned earlier, your underwriting method impacts premium and exclusions:

• Moratorium Underwriting: Often slightly cheaper initially but carries the uncertainty of potential non-cover for conditions linked to past symptoms until the moratorium period is cleared.
• Full Medical Underwriting (FMU): Can be more expensive if you have a complex medical history that leads to specific exclusions, but it provides clarity on what's covered from day one.

Cost-Saving Strategy: If you have a very clean medical history, FMU can sometimes result in a clearer, potentially more stable premium by setting out clear exclusions upfront. Moratorium offers upfront simplicity. Always remember that pre-existing conditions are not covered, regardless of the underwriting method, but FMU provides greater certainty on what specific past issues might be excluded.

5. No Claims Discount (NCD)

Similar to car insurance, many PMI policies offer a No Claims Discount. If you don't make a claim in a policy year, your NCD level increases, leading to a discount on your next year's premium. Conversely, making a claim can reduce your NCD.

Cost-Saving Strategy: Being mindful of your NCD can influence whether you make smaller claims or pay for them out of pocket, to preserve a higher discount.

6. Policy Features and Limits

Beyond the main cover level, policies have various sub-limits and optional extras:

• Out-patient limits: Caps on the number of consultations or tests.
• Therapy limits: Number of physiotherapy sessions.
• Cancer care options: Basic vs. comprehensive.
• Mental health limits: Amount covered for counselling or psychiatric treatment.
• Optional add-ons: Dental, optical, travel, wellbeing benefits.

Cost-Saving Strategy: Review each of these features carefully. Do you need unlimited out-patient consultations, or would a capped amount suffice? Are the optional add-ons truly necessary for you, or could you save money by removing them?

7. Corporate Schemes

If your employer offers private health insurance as a benefit, this is often the most cost-effective way to get cover. Group schemes typically have significantly lower premiums than individual policies, offer better benefits, and often have more favourable underwriting terms.

Cost-Saving Strategy: If available, take advantage of employer-sponsored schemes.

The Role of a Specialist Broker Like WeCovr

Navigating the myriad of options, understanding the subtle differences between policies, and finding the perfect balance between cost and comprehensive cover can be a daunting task. This is where a specialist, independent broker like WeCovr becomes invaluable.

Why Use a Broker?

• Impartial Advice: Unlike direct insurers who will only promote their own products, we offer unbiased advice, helping you compare policies across the entire market. Our loyalty is to you, the client.
• Market Comparison: The UK private health insurance market is diverse, with major players like Axa Health, Bupa, Vitality, WPA, National Friendly, Freedom Health Insurance, Saga, and many more. Each has its strengths, weaknesses, and unique policy wordings. Comparing them all yourself would be a full-time job.
• Expert Knowledge: We live and breathe health insurance. We understand the jargon, the subtle clauses, and the critical differences that can impact a claim.

How WeCovr Helps You

At WeCovr, we pride ourselves on making private health insurance accessible, understandable, and perfectly tailored to your needs. Here’s how we do it:

• Understanding Your Needs and Budget: We take the time to listen to your specific requirements, your health concerns (remembering pre-existing conditions are generally excluded), and your financial parameters. We help you explore your risk tolerance and comfort level with different excess and co-payment options.
• Explaining Complexities Clearly: We break down complex terms like excess, co-payment, underwriting, and policy exclusions into simple, actionable insights. We ensure you fully grasp what you're buying.
• Comparing Across All Major UK Insurers: Using our extensive market access and expertise, we compare policies from all leading UK health insurance providers. This ensures you see the full spectrum of options, not just one insurer's offering.
• Securing the Best Deal and Tailored Coverage: We don't just find the cheapest premium; we find the policy that offers the optimal blend of value, coverage, and affordability for your circumstances. This includes advising on the most suitable excess and co-payment levels for your specific situation.
• No Cost to You: Our services are completely free for you. We are paid a commission by the insurer when you take out a policy, meaning you get expert, personalised advice without adding a penny to your premium.
• Ongoing Support: Our relationship doesn't end once your policy is in place. We're here to assist with renewals, questions, or if your circumstances change, providing continuity and peace of mind.

Working with us at WeCovr means you benefit from deep industry knowledge, a comprehensive market view, and a commitment to securing the most advantageous private health insurance policy for you, without any hidden costs.

Real-World Scenarios and Case Studies

Let's illustrate how different choices regarding excess and co-payment might play out for various individuals and families.

Scenario 1: The Young, Healthy Professional (Prioritising Low Premiums)

• Client: Liam, 30, lives in Manchester, no significant medical history, plays sports, generally very healthy. He wants private health insurance primarily for peace of mind in case of a serious accident or unexpected acute illness, but budget is a key concern.
• WeCovr Recommendation: We explore options with a high excess and potentially a co-payment.
  • Chosen Policy: £1,000 excess (per claim) and a 10% co-payment. In-patient only cover with a restricted hospital list and the 6-week option.
  • Indicative Premium: £40-£50 per month.
• Outcome: Liam enjoys a very low monthly premium. If he needs a £8,000 acute knee surgery (e.g., from a sports injury):
  • He pays the £1,000 excess.
  • Remaining cost: £7,000.
  • 10% co-payment on £7,000 = £700.
  • His total out-of-pocket for the claim = £1,700. Insurer pays £6,300.
  • If no claim is made, he saves significantly each year. This suits his risk tolerance and financial situation.

Scenario 2: The Middle-Aged Professional (Balance of Cost and Access)

• Client: Maria, 50, based in Bristol, works a demanding job. She has no chronic conditions but values faster access to specialists for any acute issues that arise and wants good out-patient cover. She has some savings but prefers not to deplete them for medical bills.
• WeCovr Recommendation: A moderate excess with comprehensive out-patient cover.
  • Chosen Policy: £250 excess (per claim), no co-payment. Comprehensive out-patient cover (e.g., up to £1,000 for consultations/diagnostics). Full national hospital list.
  • Indicative Premium: £80-£100 per month.
• Outcome: Maria has excellent access to diagnostics and specialist consultations without paying an excess for every small visit. If she needs an acute hernia operation costing £4,000:
  • She pays the £250 excess.
  • Insurer pays £3,750.
  • Her total out-of-pocket for the claim = £250. This balances her desire for lower premiums with predictability and limited out-of-pocket costs.

Scenario 3: The Family with Young Children (Needs Some Protection on a Budget)

• Client: The Roberts family (parents aged 38 & 40, children aged 5 & 8), living in Leeds. They want to ensure their children have fast access to care for common acute childhood issues (e.g., tonsillitis, ear infections needing grommets) and cover for the parents for more significant, acute problems. Budget is tight.
• WeCovr Recommendation: A moderate family-wide excess, possibly with some limitations on out-patient.
  • Chosen Policy: £500 excess (per policy year for the whole family, if available, or per claim per person), no co-payment. Good in-patient cover, limited out-patient cover (e.g., 6 consultations per year). Restricted hospital list.
  • Indicative Premium: £120-£150 per month for the family.
• Outcome: The Roberts family has private cover at a manageable cost. If their son needs grommets, costing £2,500:
  • They pay the £500 excess.
  • Insurer pays £2,000.
  • Their total out-of-pocket for the claim = £500.
  • If their daughter then needs an acute appendectomy later in the year, and the excess is "per policy year", they pay no further excess. If it's "per claim", they'd pay another £500. This highlights the importance of understanding the excess application. This plan allows them to protect their family's health without financial distress.

Frequently Asked Questions (FAQs)

Q1: Is excess/co-payment applied to every claim?

A: This depends on your policy terms. Most commonly, an excess is applied "per claim," meaning you pay it each time you make a new claim for a different condition or a recurrence. Some policies offer a "per policy year" excess, where you only pay it once within the policy year, regardless of the number of claims. Co-payment is generally applied per eligible claim after the excess is met.

Q2: Can I change my excess/co-payment mid-policy?

A: Generally, no. Most insurers allow you to adjust your excess or co-payment levels only at your annual policy renewal date. This is because these choices directly impact your premium and the insurer's risk assessment.

Q3: Do I pay excess/co-payment for GP visits?

A: Typically, private health insurance does not cover routine GP visits, and therefore, no excess or co-payment would apply. PMI policies usually cover specialist consultations, diagnostic tests, and treatments, which are initiated by a GP referral. Some policies may include virtual GP services, which are usually a free benefit.

Q4: What happens if my claim is less than the excess?

A: If the total cost of your eligible treatment is less than your chosen excess, you will be responsible for paying the full amount of that treatment yourself. The insurer will not contribute, as the cost did not exceed your agreed excess.

Q5: Does co-payment apply to the entire cost or just certain elements?

A: Co-payment generally applies to the entire eligible cost of your treatment after the excess has been met. For example, if you have a 20% co-payment, you pay 20% of the covered hospital fees, consultant fees, and diagnostic costs for that particular claim.

Q6: How do pre-existing conditions factor in with excess/co-payment?

A: Pre-existing conditions are typically excluded from private health insurance coverage regardless of your chosen excess or co-payment. These cost-sharing mechanisms only apply to claims for acute conditions that arise after your policy has begun and are not subject to any exclusions. You will not pay an excess or co-payment for treatment of a pre-existing condition, because the treatment itself would not be covered by the policy at all.

Conclusion

Navigating the world of UK private health insurance can feel complex, but by understanding the critical roles of excess and co-payment, you gain significant control over your policy's cost and value. These cost-sharing mechanisms are not merely deductions; they are strategic choices that allow you to tailor your premium, balancing immediate affordability with potential out-of-pocket expenses should you need to claim.

Whether you opt for a high excess to dramatically reduce your monthly payments, choose a co-payment to share the risk of larger claims, or combine both for maximum savings, the "best" option is uniquely personal. It hinges on your financial situation, health status, and comfort with risk.

The key is to make an informed decision, rather than simply accepting the first quote. This means analysing your needs, considering the "what if" scenarios, and understanding the fine print. And you don't have to do it alone. At WeCovr, we are committed to providing clear, impartial advice, comparing options from all major UK insurers, and helping you build a private health insurance policy that delivers optimal value and peace of mind. Our expertise is at your disposal, at no cost to you, ensuring you find the right cover that protects your health and your finances. Take control of your healthcare future today.