TL;DR
As an FCA-authorised broker that has helped arrange over 900,000 policies, WeCovr understands that the key to great private medical insurance in the UK is not just finding the right cover, but keeping it affordable year after year. This guide provides expert strategies for managing your premiums effectively long-term. WeCovr's strategies for avoiding steep renewal price rises Private medical insurance (PMI) is an invaluable asset, offering peace of mind and swift access to high-quality medical care.
Key takeaways
- New Treatments and Drugs: Ground-breaking but expensive new therapies, drugs, and surgical procedures become available.
- Advanced Technology: The cost of state-of-the-art diagnostic equipment like MRI and CT scanners rises.
- Specialist Fees: The fees charged by top consultants and surgeons increase.
- Increased Demand: An ageing population and pressures on the NHS lead more people to use private healthcare, driving up operational costs for private hospitals.
- Local/Regional: Restricts you to a list of hospitals within a specific geographic area. The most affordable option.
As an FCA-authorised broker that has helped arrange over 900,000 policies, WeCovr understands that the key to great private medical insurance in the UK is not just finding the right cover, but keeping it affordable year after year. This guide provides expert strategies for managing your premiums effectively long-term.
WeCovr's strategies for avoiding steep renewal price rises
Private medical insurance (PMI) is an invaluable asset, offering peace of mind and swift access to high-quality medical care. However, many policyholders feel a sense of dread when their annual renewal notice arrives, often carrying a significant price increase.
The good news is that you are not powerless. While some factors driving premium rises are beyond your control, there are numerous proactive steps you can take to manage costs without sacrificing the quality of your cover. This article will walk you through the reasons for premium increases and provide actionable strategies to ensure your health cover remains a sustainable part of your financial planning.
Understanding Why Your PMI Premiums Increase
Before we explore how to control costs, it's crucial to understand why they rise in the first place. Several factors combine to influence the price you pay at renewal.
Age-Related Increases: The Primary Driver
This is the most significant and unavoidable factor. As we get older, the statistical likelihood of needing medical treatment increases. Insurers adjust their prices based on age bands (e.g., 30-34, 35-39, 40-44). Moving into a new age band at your renewal date will almost always trigger a premium increase, reflecting this higher level of risk.
Medical Inflation: The Rising Cost of Care
Medical inflation is a key reason for industry-wide price hikes. It is distinct from general inflation (the Consumer Price Index) and consistently runs at a much higher rate. In recent years, medical inflation has often been in the region of 8-12% annually.
What contributes to medical inflation?
- New Treatments and Drugs: Ground-breaking but expensive new therapies, drugs, and surgical procedures become available.
- Advanced Technology: The cost of state-of-the-art diagnostic equipment like MRI and CT scanners rises.
- Specialist Fees: The fees charged by top consultants and surgeons increase.
- Increased Demand: An ageing population and pressures on the NHS lead more people to use private healthcare, driving up operational costs for private hospitals.
Your Claims History and No-Claims Discount (NCD)
Most UK PMI policies feature a No-Claims Discount. It works similarly to car insurance: for every year you don't make a claim, you get a discount on your premium, up to a maximum level (often 65-75%).
When you make a claim, your NCD level is typically reduced at the next renewal, leading to a higher premium. For example, making a claim might reduce your NCD from 70% down to 50%, causing a noticeable price jump. Some smaller claims, like for physiotherapy, may not affect your NCD, but it's vital to check your policy documents.
Insurance Premium Tax (IPT)
This is a tax levied by the UK government on all general insurance policies, including PMI. The current rate is 12%. This tax is applied to your gross premium, so if the base cost of your insurance rises, the amount you pay in tax also increases. Any future changes to the IPT rate by the government will directly affect your final premium.
Provider-Specific Adjustments
Insurers periodically review their overall claims experience and financial performance. If a provider has paid out more in claims than anticipated across its customer base, it may implement an across-the-board price increase to rebalance its books.
Proactive Strategies to Manage Your Premiums from Day One
The decisions you make when you first take out a policy have the most significant long-term impact on its affordability. Rushing this stage can lock you into a costly plan that isn't right for you.
Choose the Right Level of Cover
Not all private health cover is the same. Policies are typically tiered, and choosing the appropriate level is your first line of defence against high costs.
| Cover Level | Description | Best For |
|---|---|---|
| Basic / Treatment Only | Covers essential in-patient and day-patient treatment (e.g., surgery requiring a hospital bed). Out-patient consultations and diagnostics are usually not included or are capped at a low limit. | Those seeking a safety net for major medical events at the lowest possible cost. |
| Mid-Range / Standard | Includes everything in a basic plan, plus a reasonable level of out-patient cover (e.g., up to £1,000 for specialist consultations and diagnostic tests). | A good balance of comprehensive cover and affordability for most people. |
| Comprehensive | Offers extensive in-patient and day-patient cover, plus high or unlimited out-patient cover. Often includes therapies (physio, osteopathy) and mental health support as standard. | Individuals who want the highest level of reassurance and minimal financial limits. |
Top Tip: Be realistic about your needs. A comprehensive plan is excellent, but if your budget is tight, a mid-range policy with solid out-patient cover often provides the perfect balance of security and value.
The Power of the Excess
An excess is the amount you agree to pay towards the cost of a claim. For instance, if you have a £250 excess and receive treatment costing £3,000, you pay the first £250, and the insurer pays the remaining £2,750. (illustrative estimate)
The higher your excess, the lower your monthly premium. Insurers reward you for sharing a small part of the risk.
Illustrative Impact of Excess on Premiums: (Example for a 45-year-old, non-smoker)
| Excess Level | Illustrative Monthly Premium | Annual Saving vs. £0 Excess |
|---|---|---|
| £0 | £95 | £0 |
| £250 | £80 | £180 |
| £500 | £72 | £276 |
| £1,000 | £60 | £420 |
When choosing an excess, pick an amount you could comfortably afford to pay without causing financial hardship. For many, a £250 or £500 excess is the sweet spot. (illustrative estimate)
Select a Suitable Hospital List
Insurers group private hospitals into bands based on their costs. Central London hospitals, for example, are the most expensive in the country. Opting for a policy that excludes these high-cost hospitals can significantly reduce your premium.
Common Hospital List Options:
- Local/Regional: Restricts you to a list of hospitals within a specific geographic area. The most affordable option.
- Nationwide: Gives you access to a broad network of private hospitals across the UK, but typically excludes the most expensive Central London facilities.
- Nationwide with London: The most comprehensive and expensive list, including top private hospitals in Central London.
Unless you live or work in Central London and are adamant about being treated there, choosing a nationwide list that excludes the priciest options is a very effective cost-saving measure.
Consider a "Guided" or "Expert Select" Option
A growing number of insurers, including major players like AXA and Aviva, offer "guided" plans. With these, instead of choosing your own specialist, the insurer provides you with a shortlist of 2-3 recognised consultants for your condition.
Because the insurer can direct you to specialists with whom they have fee agreements and a record of excellent, cost-effective outcomes, they pass the savings on to you in the form of a lower premium (often a 15-20% reduction). This is a superb way to save money without compromising on the quality of care.
Key Strategies for Your Annual Renewal
Receiving your renewal invitation is a critical moment. This is your annual opportunity to reassess your cover and take action to control costs.
Don't Just Auto-Renew: Review Your Policy Annually
This is the single most important piece of advice. Insurers often save their most competitive rates for new customers. Allowing your policy to auto-renew year after year without shopping around is the surest way to end up overpaying, a phenomenon known as the "loyalty penalty" which the Financial Conduct Authority (FCA) has been working to address.
At renewal, ask yourself:
- Have my circumstances changed? (e.g., children left home, moved house)
- Is my current level of cover still appropriate?
- Can I afford to increase my excess?
- Could a different hospital list work for me?
An expert PMI broker like WeCovr can conduct a full market review for you at no cost, comparing your renewal offer against the latest products from all the best PMI providers.
Re-broking: The Most Effective Way to Find a Better Deal
Re-broking simply means switching your policy to a new insurer. This often unlocks new-customer pricing and can save you hundreds, or even thousands, of pounds per year. However, it's crucial to switch on the correct underwriting terms to protect your continuity of cover.
Understanding Switching Underwriting:
- Moratorium Underwriting: You don't declare your medical history upfront. The new insurer automatically excludes treatment for any conditions you've had symptoms of, or sought advice for, in the 5 years before the policy start date.
- Full Medical Underwriting (FMU): You complete a full health questionnaire. The insurer assesses your history and applies specific exclusions to your policy from day one.
- Continued Personal Medical Exclusions (CPME): This is the gold standard for switching. CPME allows you to move to a new insurer on the same underwriting terms you had with your old one. Any exclusions on your original policy are carried over, but crucially, any new conditions that developed while you were covered by your old policy will be covered by the new one. This is a complex process and is the primary reason to use a specialist broker. WeCovr specialises in CPME transfers to ensure clients can switch providers without losing valuable cover.
Negotiating with Your Current Insurer
Before you switch, it can be worthwhile speaking to your existing provider.
- Inform them you are considering leaving and that you have received cheaper quotes elsewhere. They may be able to offer a discount to retain your business.
- Ask to adjust your cover. You can request to increase your excess, downgrade your hospital list, or add a six-week option (where you use the NHS if treatment is available within six weeks). These changes can make your existing policy more affordable.
The Crucial Role of Health and Wellbeing in Managing Premiums
A healthier lifestyle not only improves your quality of life but can also have a direct, positive impact on your insurance costs.
Embrace Insurer Wellness Programmes
Many leading providers of private medical insurance in the UK, such as Vitality and Aviva, have integrated wellness programmes into their policies. These programmes incentivise healthy behaviour with tangible rewards.
- Activity Tracking: Earn points for tracking your daily steps, workouts, or gym visits, which can translate into weekly cinema tickets, free coffee, or even direct discounts on your renewal premium.
- Health Checks: Get rewarded for completing online health reviews or in-person health checks.
- Healthy Food Purchases: Some programmes offer discounts on healthy food ranges at partner supermarkets.
Engaging with these schemes can make your policy more affordable and motivate you to maintain a healthier lifestyle.
WeCovr's Added Value: The CalorieHero App and Policy Discounts
At WeCovr, we believe in empowering our clients to take control of their health. That's why all clients who purchase a PMI or Life Insurance policy with us receive complimentary access to CalorieHero, our proprietary AI-powered calorie and nutrition tracking app. This tool makes it easy to monitor your diet and make healthier choices, aligning perfectly with a long-term strategy to stay well.
Furthermore, we offer our clients discounts on other types of cover. If you arrange your private medical insurance through us, you may be eligible for a preferential rate on policies like life insurance or income protection, creating even more value.
Simple Lifestyle Changes with a Big Impact
According to NHS guidance, small, consistent changes can dramatically reduce your risk of developing many acute and chronic conditions.
- Balanced Diet: Following the principles of the NHS Eatwell Guide can help maintain a healthy weight and reduce the risk of heart disease, type 2 diabetes, and some cancers.
- Regular Exercise: The NHS recommends adults aim for at least 150 minutes of moderate-intensity activity (like brisk walking or cycling) or 75 minutes of vigorous-intensity activity (like running) per week.
- Quality Sleep: Consistent, high-quality sleep is essential for physical and mental recovery, helping to regulate everything from your immune system to your appetite.
- Stress Management: Chronic stress can contribute to a range of health issues. Incorporating mindfulness, hobbies, and relaxation techniques can have a profound effect on your overall wellbeing.
A Note on Pre-existing and Chronic Conditions
It is a fundamental principle of the UK PMI market that must be understood: standard private medical insurance is designed to cover acute conditions that arise after you take out your policy.
- Acute Condition: A disease, illness, or injury that is likely to respond quickly to treatment and lead to a full recovery (e.g., joint replacement, cataract surgery, hernia repair).
- Chronic Condition: A condition that is long-lasting and often has no known cure. It requires ongoing management rather than a curative treatment (e.g., diabetes, asthma, hypertension, Crohn's disease).
Standard PMI policies do not cover the management of chronic conditions. They also exclude pre-existing conditions—any ailment for which you have experienced symptoms, received medication, or sought advice in the years leading up to your policy start date (typically the last 5 years).
Comparing Private Medical Insurance UK Providers
The market is competitive, and costs can vary significantly. The table below provides an illustrative comparison.
Illustrative Monthly Premiums (Based on a 40-year-old, non-smoker, on a mid-range plan with a £250 excess and a nationwide hospital list)
| Provider | Illustrative Monthly Premium | Key Features |
|---|---|---|
| AXA Health | £75 | Strong core cover, guided specialist options available for a discount. |
| Aviva | £72 | Excellent digital GP service, comprehensive mental health support. |
| Bupa | £80 | Extensive network of hospitals and clinics, direct access to cancer care. |
| Vitality | £68 | Lower initial premium, heavily focused on wellness rewards and engagement. |
Disclaimer: These prices are for illustrative purposes only and are subject to change. Your actual premium will depend on your age, location, medical history, and chosen cover options. Contact WeCovr for a precise, personalised quote.
The WeCovr Advantage: Why Use an Expert PMI Broker?
Navigating the private health cover market can be complex and time-consuming. Using an independent, expert broker like WeCovr simplifies the process and ensures you get the best possible outcome.
- Whole-of-Market Advice: We are not tied to any single insurer. We compare policies from all the leading UK providers to find the one that best suits your needs and budget.
- Unmatched Expertise: We live and breathe PMI. We understand the nuances of policy wordings and are experts in complex areas like CPME switching, ensuring your continuity of cover is always protected.
- No Cost to You: Our service is completely free. We are paid a commission by the insurer you choose, which is already built into the premium, so you pay the same price or less than going direct.
- Ongoing Support: Our relationship doesn't end once your policy is live. We are here to help with claims queries and, most importantly, will proactively manage your renewal each year to keep your cover competitive.
- Trust and Reliability: WeCovr is fully authorised and regulated by the Financial Conduct Authority (FCA) and has earned high customer satisfaction ratings for our transparent, client-focused approach.
Frequently Asked Questions (FAQ)
Q1: Can I still get private medical insurance if I have a pre-existing condition? A: Yes, you can still get a policy, but it will not cover your pre-existing conditions or any related ailments. UK PMI is designed to cover new, acute medical conditions that arise after your policy begins. The management of long-term chronic conditions is also excluded.
Q2: Will my premium definitely go up if I make a claim? A: Making a claim will typically lead to a reduction in your No-Claims Discount (NCD) at your next renewal, which increases the premium. However, the overall increase also depends on other factors like your age and general medical inflation. Some minor claims, depending on the insurer, might not affect your NCD.
Q3: Is it better to switch insurers or stay with my current one at renewal? A: It is almost always better to review the market rather than auto-renew. Often, a new insurer will offer a more competitive price. However, it's vital to switch on the correct terms (ideally CPME) to protect your cover for conditions that have developed. An expert broker can advise whether switching or negotiating with your current provider is the best strategy for your specific circumstances.
Q4: What is the average cost of private health cover in the UK? A: There is no single "average" cost, as it varies dramatically based on age, location, smoking status, and the level of cover chosen. A basic policy for a 30-year-old might start from £35 per month, while comprehensive cover for a 55-year-old could be £150 per month or more. The best way to find out the cost for you is to get a personalised quote.
Don't let rising premiums put your peace of mind at risk. Take control of your private medical insurance costs with expert, independent advice.
Contact WeCovr today for a free, no-obligation quote and let our specialists find the perfect, affordable cover for you.
Sources
- Department for Transport (DfT): Road safety and transport statistics.
- DVLA / DVSA: UK vehicle and driving regulatory guidance.
- Association of British Insurers (ABI): Motor insurance market and claims publications.
- Financial Conduct Authority (FCA): Insurance conduct and consumer information guidance.
