TL;DR
As an FCA-authorised broker that has helped arrange over 900,000 policies, WeCovr offers expert guidance on private medical insurance in the UK. This article explores why providing health cover is a powerful tool for employee retention, backed by the latest data on what UK staff truly value in 2025. Survey data on why PMI is a top-rated staff benefit In today's competitive job market, salary is no longer the sole factor driving employee satisfaction and loyalty.
Key takeaways
- Referral to Treatment (RTT): The target is for 92% of patients to wait less than 18 weeks from referral for treatment. The current performance is significantly below this, with many thousands waiting over a year.
- Cancer Treatment: While urgent cancer referrals are prioritised, waiting time targets for starting treatment after diagnosis are frequently missed.
- Diagnostics: Long waits for key diagnostic tests like MRI and CT scans can delay diagnosis and cause prolonged anxiety.
- Fast access to therapy: Bypassing long NHS waits for talking therapies like CBT.
- Confidential support lines: 24/7 access to trained counsellors.
As an FCA-authorised broker that has helped arrange over 900,000 policies, WeCovr offers expert guidance on private medical insurance in the UK. This article explores why providing health cover is a powerful tool for employee retention, backed by the latest data on what UK staff truly value in 2025.
Survey data on why PMI is a top-rated staff benefit
In today's competitive job market, salary is no longer the sole factor driving employee satisfaction and loyalty. Workplace benefits have become a critical differentiator, and private medical insurance (PMI) consistently ranks among the most desired perks.
Recent survey data reveals a significant shift in employee priorities. The post-pandemic landscape, coupled with unprecedented pressures on the NHS, has pushed health and wellbeing to the forefront of people's minds. A 2024 survey by the Chartered Institute of Personnel and Development (CIPD) found that health and wellbeing benefits were a key consideration for over 60% of employees when choosing a new employer.
Furthermore, when asked to rank non-pension benefits, private health cover frequently appears in the top three, alongside flexible working and enhanced annual leave. This high valuation is not just about perceived luxury; it's a practical response to tangible concerns about healthcare access.
| Benefit Category | Percentage of Employees Rating as 'Important' or 'Very Important' |
|---|---|
| Flexible Working Hours | 71% |
| Private Medical Insurance | 65% |
| Generous Pension Contributions | 62% |
| Enhanced Annual Leave | 58% |
| Mental Health Support | 55% |
Source: Aggregated data from various 2024 UK employee benefits surveys.
This data underscores a clear message for employers: offering private medical insurance isn't just a perk; it's a strategic investment in attracting and retaining top talent. It demonstrates a genuine commitment to staff welfare that resonates deeply in the current climate.
Why Health and Wellbeing is a Priority for UK Employees
The strong demand for PMI is not happening in a vacuum. It is a direct result of several converging factors that have reshaped how we view health in the UK.
The Shadow of NHS Waiting Lists
The most significant driver is the current state of NHS services. While the NHS remains a cherished institution, it is facing immense strain. According to the latest NHS England data from early 2025, the number of people on waiting lists for routine hospital treatment remains stubbornly high, exceeding 7.5 million.
- Referral to Treatment (RTT): The target is for 92% of patients to wait less than 18 weeks from referral for treatment. The current performance is significantly below this, with many thousands waiting over a year.
- Cancer Treatment: While urgent cancer referrals are prioritised, waiting time targets for starting treatment after diagnosis are frequently missed.
- Diagnostics: Long waits for key diagnostic tests like MRI and CT scans can delay diagnosis and cause prolonged anxiety.
These delays have real-world consequences. For an employee, a long wait for a hip replacement or a diagnostic scan means extended periods of pain, reduced mobility, and an inability to perform their job effectively. This directly impacts their quality of life and financial stability. PMI is seen as a direct solution to this uncertainty.
A New Focus on Mental Health
The conversation around mental health has transformed over the last decade. It is no longer a taboo subject but a recognised and critical component of overall wellbeing.
The Office for National Statistics (ONS) reported that in 2024, stress, depression, or anxiety accounted for a significant portion of all work-related ill health. Employees are now actively seeking employers who provide robust mental health support. Most comprehensive private medical insurance UK policies include dedicated mental health pathways, offering:
- Fast access to therapy: Bypassing long NHS waits for talking therapies like CBT.
- Confidential support lines: 24/7 access to trained counsellors.
- In-patient psychiatric care: Cover for more severe conditions requiring hospitalisation.
Offering this level of support signals that an employer takes mental wellbeing as seriously as physical health.
The Rise of the 'Wellness' Culture
Beyond simply treating illness, there is a growing desire for proactive health management. Modern PMI plans cater to this by bundling in a wide array of wellness benefits. These often include:
- Discounted gym memberships.
- Access to digital GP services 24/7.
- Health screening and assessments.
- Nutrition and physiotherapy support.
- Access to wellness apps. For example, all WeCovr customers get complimentary access to CalorieHero, our AI-powered diet and calorie tracking app, to help them stay on top of their health goals.
These features empower employees to take control of their health, preventing minor issues from becoming major problems.
The Tangible Benefits of PMI for Your Staff
When an employee has access to a company PMI scheme, they unlock a range of benefits that provide peace of mind and practical help when it's needed most.
1. Swift Access to Diagnosis and Treatment
This is the cornerstone of private health cover. Instead of waiting weeks or months for an NHS consultation after a GP referral, an employee with PMI can typically see a specialist within days.
Real-Life Example: Sarah, a marketing manager, is experiencing persistent knee pain.
- Via the NHS: Her GP refers her to an orthopaedic specialist. The waiting list in her area is 28 weeks for an initial consultation, followed by another potential wait for an MRI scan, and then a further 40-week wait for surgery.
- With Company PMI: Her GP refers her to a specialist. She calls her PMI provider, who authorises the consultation. She sees a private specialist the following week, has an MRI scan three days later, and is booked for keyhole surgery within a fortnight.
Sarah is back at work and pain-free in a fraction of the time, avoiding months of discomfort and reduced productivity.
2. Choice, Control, and Comfort
PMI gives employees a level of control over their healthcare that is not possible through the NHS. This includes:
- Choice of Specialist: The ability to research and choose a leading consultant for their specific condition.
- Choice of Hospital: Access to a nationwide network of high-quality private hospitals.
- Convenient Appointments: Scheduling consultations and treatments at times that suit them, minimising disruption to work and family life.
- Private Facilities: The comfort of a private, en-suite room during a hospital stay, creating a more restful environment for recovery.
3. Access to Advanced Treatments
The private sector can sometimes offer access to new drugs, treatments, or surgical techniques that are not yet approved by the National Institute for Health and Care Excellence (NICE) for widespread NHS use due to cost or ongoing evaluation. This is particularly relevant in areas like oncology, where a specific drug could be a patient's best option but isn't standard NHS protocol.
4. Comprehensive Digital Health Tools
Modern PMI is not just for major medical events. The digital tools included are used far more frequently and provide daily value.
| Feature | Description | Benefit to Employee |
|---|---|---|
| Digital GP | 24/7 access to a GP via phone or video call. | Get medical advice, prescriptions, or referrals without leaving home or taking time off work. |
| Mental Health Apps | Access to platforms for mindfulness, meditation, and therapy. | Proactive and confidential support for managing stress and anxiety. |
| Wellness Programmes | Discounts on gyms, fitness trackers, and health foods. | Encourages a healthier lifestyle and can prevent future health issues. |
| Second Opinion Service | Access to a world-leading expert for a second opinion on a diagnosis. | Provides peace of mind and confidence in a proposed treatment plan. |
How Offering PMI Boosts Employee Retention
For a business, the benefits of providing PMI extend far beyond simply making staff happy. It has a direct and measurable impact on key business metrics, particularly retention and productivity.
Reducing Costly Sickness Absence
According to the ONS, an estimated 185.6 million working days were lost because of sickness or injury in the UK in 2022, the highest figure on record. Each of these days represents lost productivity and a direct cost to the business.
By providing PMI, you accelerate an employee's return to health.
- Faster diagnosis means less time off for initial appointments.
- Faster treatment means a significantly shorter recovery period.
- Effective mental health support can prevent burnout and reduce stress-related absence.
The cost of a PMI policy can often be offset by the savings made from reducing just a few days of sickness absence across the workforce.
Gaining a Competitive Edge in Recruitment
In a candidate-driven market, a strong benefits package can be the deciding factor between two otherwise similar job offers. Advertising that your company offers private health cover instantly elevates your proposition. It shows you are an employer that invests in its people's long-term wellbeing.
This is particularly crucial for small and medium-sized enterprises (SMEs) competing with larger corporations for talent. A comprehensive PMI scheme can be a powerful tool to level the playing field.
Fostering a Positive and Loyal Company Culture
When employees feel cared for, they are more engaged, more motivated, and more loyal. Offering PMI sends a powerful message: "We value you as a person, not just as an employee."
This fosters a culture of mutual respect and appreciation, which is the bedrock of high retention rates. Staff are less likely to look for opportunities elsewhere if they feel their employer is genuinely invested in their health and security. An expert PMI broker like WeCovr can help you design a plan that reinforces this culture.
A Critical Note: Understanding PMI's Limitations
It is crucial for both employers and employees to understand what standard private medical insurance in the UK does and does not cover. Transparency here is key to managing expectations.
PMI is designed to cover acute conditions that arise after you take out the policy.
- An 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).
- A Chronic Condition: A condition that is long-lasting and often has no known cure. It can be managed but not resolved (e.g., diabetes, asthma, high blood pressure, arthritis). PMI will typically not cover the ongoing management of chronic conditions. It may cover an acute flare-up, but not the day-to-day care.
- Pre-existing Conditions: Any medical condition you had symptoms of, or received advice or treatment for, in the years before your policy started. These are usually excluded from cover, either permanently or for a set period.
This is why PMI is considered complementary to the NHS, not a complete replacement. The NHS provides excellent emergency care and manages long-term chronic conditions, while PMI offers a fast track for treatable acute issues.
Designing the Right Group PMI Scheme for Your Business
Not all PMI policies are created equal. As an employer, you have a range of options to tailor a scheme that fits your budget and your employees' needs. Working with a specialist broker is the best way to navigate this complex market.
Key Policy Options to Consider
| Level of Cover | What It Typically Includes | Best For |
|---|---|---|
| Basic | In-patient and day-patient treatment only. Limited choice of hospitals. | Businesses on a tight budget wanting to provide core protection against major medical events. |
| Mid-Range | Adds cover for out-patient consultations, diagnostic scans, and sometimes limited therapies. | A good balance of cost and comprehensive cover, suitable for most SMEs. |
| Comprehensive | Full out-patient cover, mental health support, therapies (physio, osteo), dental, and optical options. | Businesses looking to offer a top-tier benefit to attract and retain senior talent. |
Understanding Underwriting
This is how an insurer assesses risk and decides what to cover.
- Moratorium (Most Common for SMEs): Pre-existing conditions from the last 5 years are automatically excluded. However, if an employee goes 2 continuous years without symptoms, advice, or treatment for that condition after joining, it may become eligible for cover. It's simple to set up with no medical forms.
- Full Medical Underwriting (FMU): Employees complete a detailed health questionnaire. The insurer then specifies exactly what is and isn't covered from the start. It's more admin-intensive but provides complete clarity.
- Medical History Disregarded (MHD): Usually only available for larger corporate schemes (e.g., 20+ employees). The insurer agrees to cover eligible pre-existing conditions. This is the most premium option.
An independent PMI broker like WeCovr can explain these options in plain English and advise which is most suitable for your company's size and goals. Furthermore, when you purchase PMI or life insurance through WeCovr, you may be eligible for discounts on other types of insurance, providing even greater value.
The Financial Case: Is PMI a Worthwhile Investment?
For any business, the cost is a primary consideration. It's important to view PMI not as an expense, but as an investment with a clear return.
- Tax Efficiency: The cost of the PMI premiums paid by the company is considered a legitimate business expense and is therefore allowable against Corporation Tax.
- Benefit-in-Kind (P11D): For the employee, the PMI premium is treated as a 'benefit-in-kind'. This means they will have to pay income tax on the value of the benefit. The company will also pay Class 1A National Insurance contributions on the premium amount. While this adds a small cost, it is often seen as a minor trade-off for the significant value the cover provides.
- Return on Investment (ROI): The true ROI comes from:
- Reduced Recruitment Costs: The average cost to recruit a new employee can run into thousands of pounds. Retaining just one key member of staff can pay for a significant portion of the annual PMI premium.
- Increased Productivity: A healthy, present, and focused workforce is a productive one. Reducing absence and 'presenteeism' (working while unwell) has a direct positive impact on your bottom line.
By working with an experienced broker, you can find the best PMI provider at a competitive price point, ensuring your investment delivers maximum value for both your business and your staff.
Is company health insurance a taxable benefit in the UK?
Does private medical insurance cover pre-existing conditions?
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To discover how a tailored private medical insurance plan can transform your employee retention strategy and boost productivity, speak to an expert today.
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