Private Medical Insurance Glossary All Terms Explained
Navigating the world of private medical insurance in the UK can feel like learning a new language. At WeCovr, an FCA-authorised broker that has helped arrange over 900,000 policies of various types, we believe in making health cover simple and transparent. This guide deciphers all the essential PMI jargon.
Quick-reference for technical, clinical, and policy lingo in the PMI world
Welcome to your definitive A-to-Z guide for understanding Private Medical Insurance (PMI). We've broken down every term you're likely to encounter, from the basics of your policy to the clinical details of your treatment. Our goal is to empower you with knowledge so you can choose the right private health cover with confidence.
Core Policy & Premium Terms
These are the fundamental building blocks of any private medical insurance policy. Understanding them is the first step to mastering your cover.
Policyholder The person who owns the insurance policy. This can be an individual, a family, or a company for a group scheme.
Premium The regular amount you pay (usually monthly or annually) to keep your insurance policy active. Your premium is calculated based on factors like your age, location, lifestyle (e.g., smoking status), and the level of cover you choose.
Excess (or Deductible) A fixed amount you agree to pay towards the cost of your treatment each policy year. For example, if you have a £250 excess and your eligible treatment costs £2,000, you pay the first £250, and your insurer pays the remaining £1,750. Choosing a higher excess can often lower your premium.
Dependant A person added to your policy who is not the main policyholder, typically a spouse, partner, or child. Adding dependants will increase your premium.
Policy Year The 12-month period your policy is active, starting from your policy's inception or renewal date. Your benefit limits and excess usually reset at the beginning of each policy year.
Renewal The point at which your 12-month policy term ends. Your insurer will offer you a new premium for the next year based on your age, your claims history, and medical inflation. This is a great opportunity to review your cover with a broker to ensure it still offers the best value.
Insurance Premium Tax (IPT) A tax levied by the UK government on general insurance premiums, including PMI. As of 2025, the standard rate is 12%. This is automatically included in the premium quoted by your insurer.
Underwriting: The Gatekeeper of Your Cover
Underwriting is the process an insurer uses to assess your medical history and decide the terms of your policy. This is where the crucial rules about pre-existing conditions come into play.
A Critical Rule: Acute vs. Chronic and Pre-existing Conditions It is vital to understand this distinction: Standard UK private medical insurance is designed to cover acute conditions that arise after you take out your policy. It does not cover pre-existing conditions or chronic conditions.
- Acute Condition: A disease, illness, or injury that is likely to respond quickly to treatment and lead to a full recovery. Examples include a broken bone, appendicitis, or a cataract. PMI is for this.
- Chronic Condition: A disease, illness, or injury that has one or more of the following characteristics: it needs ongoing or long-term monitoring, has no known cure, requires palliative care, or is likely to recur. Examples include diabetes, asthma, arthritis, and high blood pressure. PMI does not cover the management of chronic conditions.
- Pre-existing Condition: Any illness, disease, or injury for which you have experienced symptoms, received medication, advice, or treatment before your policy start date. These are typically excluded from cover, at least initially.
There are two main ways insurers underwrite your application:
1. Moratorium Underwriting (MORI) This is the most common type of underwriting. You don't need to declare your full medical history upfront. Instead, the insurer applies a "waiting period" (the moratorium).
- How it works: Any pre-existing condition you've had in the 5 years before your policy starts is automatically excluded. However, if you go for a set period (usually 2 years) without any symptoms, treatment, or advice for that condition, it may become eligible for cover.
- Example: You had knee pain 3 years before starting your policy. It's excluded. If you remain symptom-free and treatment-free for that knee for the first 2 years of your policy, it will likely be covered thereafter.
- Pros: Quick and easy application process.
- Cons: Lack of certainty. You may not know if a condition is covered until you make a claim.
2. Full Medical Underwriting (FMU) With FMU, you provide your complete medical history on the application form. The insurer then assesses this information and tells you exactly what is and isn't covered from day one.
- How it works: The insurer may apply specific exclusions to your policy based on your declared history.
- Example: You declare you had treatment for back pain 4 years ago. The insurer might place a permanent exclusion on any back-related conditions.
- Pros: Complete clarity from the start. You know exactly where you stand.
- Cons: A longer, more detailed application process.
An expert PMI broker like WeCovr can be invaluable in helping you understand which underwriting option best suits your personal medical history and preferences.
| Underwriting Type | Application Process | Certainty of Cover | Best For |
|---|---|---|---|
| Moratorium (MORI) | Fast and simple. No medical forms. | Less certain. Cover for past conditions is decided at the point of claim. | People with a clean bill of health or those who want a quick start. |
| Full Medical (FMU) | Longer. Requires a full medical questionnaire. | Fully certain. Exclusions are clearly stated from day one. | People with a complex medical history who want absolute clarity on their cover. |
Levels of Cover: What's Included?
PMI policies are not one-size-fits-all. They are built in layers, allowing you to tailor the cover to your needs and budget.
In-patient Cover This is the core of all PMI policies. It covers costs when you are admitted to a hospital and occupy a bed overnight. This includes surgery, accommodation, nursing care, and specialist fees.
Day-patient Cover This covers you when you are admitted to a hospital for a planned procedure but do not need to stay overnight. Examples include an endoscopy or minor surgery where you go home the same day. This is also a standard feature of most policies.
Out-patient Cover This is a crucial add-on that covers consultations, diagnostic tests, and scans that do not require hospital admission.
- Why it matters: Out-patient cover is essential for getting a fast diagnosis. Without it, you would still rely on the NHS for your initial consultations and tests, which can involve long waits.
- Levels: Insurers often offer different levels of out-patient cover, from a limited monetary value (e.g., £500 per year) to full cover with no yearly limit.
Cancer Cover A cornerstone of modern PMI, this benefit provides funding for the diagnosis and treatment of cancer. This often includes access to specialist drugs and treatments not yet available on the NHS. Most comprehensive policies offer extensive cancer cover as standard.
Six-Week Option A popular way to reduce your premium. With this option, if the NHS can provide the in-patient treatment you need within six weeks of it being recommended, you agree to use the NHS. If the NHS wait is longer than six weeks, your private cover kicks in. According to NHS England data, the median waiting time for consultant-led elective care was around 14 weeks in mid-2024, making this a calculated risk.
Clinical & Treatment Terms
When you start a claim, you'll encounter a new set of medical and procedural terms.
Consultant / Specialist A senior doctor who has completed specialist training in a particular area of medicine (e.g., a Cardiologist, Orthopaedic Surgeon, or Oncologist). Your GP will refer you to a consultant for a specialist opinion.
General Practitioner (GP) Your family doctor. In most PMI journeys, a GP referral is the first step to accessing your private health cover. Many policies now include a digital GP service, allowing you to have a video consultation within hours.
Diagnosis / Diagnostics The process of identifying a medical condition. Diagnostic tests can include blood tests, X-rays, MRI scans, and CT scans. Your out-patient cover level determines how these are paid for.
Palliative Care Treatment focused on relieving symptoms and improving the quality of life for a patient with a life-limiting illness. This is generally not covered by PMI, as it falls under the umbrella of chronic care management.
Therapies Treatments such as physiotherapy, osteopathy, and chiropractic care. These are often included as an add-on or within a comprehensive out-patient benefit. They are crucial for recovery from musculoskeletal injuries.
Wellness Tip: Staying active is key to preventing many musculoskeletal issues. Even 30 minutes of brisk walking each day can strengthen your joints and improve your posture. And if you have a PMI policy with WeCovr, you get complimentary access to our AI calorie tracking app, CalorieHero, to help manage your diet and overall health.
Making a Claim: The Process Explained
Knowing these terms will make the claims process smooth and stress-free.
Pre-authorisation This is the most important step in making a claim. Before you have any treatment, you must contact your insurer with the details from your specialist. The insurer will check that the condition and treatment are covered by your policy and provide you with an authorisation number. Without pre-authorisation, your claim may be rejected.
Open Referral This is when your GP refers you to a type of specialist (e.g., "a dermatologist") rather than a named individual. This gives your insurer the flexibility to guide you to a consultant within their approved network.
Guided Option / Hospital Network Most insurers have a list or network of approved hospitals and specialists.
- Hospital List: A list of hospitals where you can receive treatment. These are often tiered (e.g., a standard list and a more expensive extended list including central London hospitals). Choosing a more limited list can reduce your premium.
- Guided Option: Some insurers offer a "guided" journey where they will select a few appropriate specialists for you to choose from. This can result in a significant premium discount (often 15-20%).
Fee Guidelines Insurers set limits on how much they will pay for a particular procedure or consultation. Most consultants charge within these guidelines, but a small number may charge more. If a consultant's fee exceeds the guideline, this is known as a shortfall, and you would be liable for the difference.
Extra Benefits & Add-ons
These optional extras allow you to build a policy that reflects your priorities.
Mental Health Cover An increasingly popular add-on that provides cover for psychiatric treatment, counselling, and therapy. Given that around 1 in 4 people in the UK experience a mental health problem each year, this is a valuable benefit. It typically covers a set number of therapy sessions or provides in-patient/day-patient care for acute mental health conditions.
Dental & Optical Cover This can be added to your policy to help cover the costs of routine dental check-ups, hygienist visits, and new glasses or contact lenses. It usually works on a cashback basis up to an annual limit.
Wellness Programmes Many leading UK PMI providers now offer rewards for healthy living. By tracking your activity, getting health checks, or buying healthy food, you can earn points towards rewards like cinema tickets, coffee, or even discounts on your renewal premium.
The 'Small Print': Exclusions & Limitations
Every policy has exclusions. It's crucial to know what isn't covered to avoid surprises.
Common General Exclusions
| Category | Examples of Excluded Treatments | Reason for Exclusion |
|---|---|---|
| Chronic Conditions | Management of diabetes, asthma, high blood pressure. | PMI is for acute, short-term conditions. |
| Pre-existing Conditions | A knee injury you had before the policy started. | Insurance is for unforeseen future events. |
| Lifestyle Choices | Cosmetic surgery, treatment for alcoholism or drug abuse. | Not considered medically necessary treatment. |
| Routine & Preventative | Routine pregnancy/childbirth, health screenings without symptoms. | PMI covers treatment for illness, not routine care. |
| High-Risk Activities | Injuries from professional sports or hazardous pursuits (e.g., rock climbing). | These carry a higher, predictable risk of injury. |
| Emergencies | A&E visits, initial treatment for a heart attack or stroke. | These are always handled by the NHS emergency services. |
Regulatory & Market Terms
These terms relate to the wider private medical insurance UK market and its regulation.
Financial Conduct Authority (FCA) The UK's financial services regulator. All reputable insurers and brokers, including WeCovr, are authorised and regulated by the FCA. This ensures they meet strict standards for fairness, transparency, and competence.
No Claims Discount (NCD) Similar to car insurance, many PMI policies feature a No Claims Discount. For every year you don't make a claim, you receive a discount on your renewal premium, up to a maximum level (e.g., 70%). If you do claim, your NCD level will be reduced.
Medical Inflation The rate at which medical treatment costs are rising. This is typically much higher than general inflation, driven by new technologies, expensive drugs, and increasing demand. Medical inflation is a primary reason why PMI premiums tend to rise each year, even if you don't claim.
Frequently Asked Questions (FAQs)
Will my private medical insurance premium go up every year?
Can I switch my PMI provider if my renewal price is too high?
What is the difference between a broker and going direct to an insurer?
Take the Next Step with Confidence
Understanding the language of private medical insurance is the first step. The next is finding the policy that perfectly matches your health needs and budget. With the NHS facing record demand, securing fast access to high-quality care has never been more important.
Let the experts at WeCovr do the hard work for you. We compare policies from the UK's leading providers, explain all your options in plain English, and ensure you get the right cover at the best possible price. Our advice is impartial and comes at no cost to you.
Get your free, no-obligation PMI quote today and take control of your health.
Related guides
Why private medical insurance and how does it work?
What is Private Medical Insurance?
Private medical insurance (PMI) is a type of health insurance that provides access to private healthcare services in the UK. It covers the cost of private medical treatment, allowing you to bypass NHS waiting lists and receive faster, more convenient care.How does it work?
Private medical insurance works by paying for your private healthcare costs. When you need treatment, you can choose to go private and your insurance will cover the costs, subject to your policy terms and conditions. This can include:• Private consultations with specialists
• Private hospital treatment and surgery
• Diagnostic tests and scans
• Physiotherapy and rehabilitation
• Mental health treatment
Your premium depends on factors like your age, health, occupation, and the level of cover you choose. Most policies offer different levels of cover, from basic to comprehensive, allowing you to tailor the policy to your needs and budget.
Questions to ask yourself regarding private medical insurance
Just ask yourself:👉 Are you concerned about NHS waiting times for treatment?
👉 Would you prefer to choose your own consultant and hospital?
👉 Do you want faster access to diagnostic tests and scans?
👉 Would you like private hospital accommodation and better food?
👉 Do you want to avoid the stress of NHS waiting lists?
Many people don't realise that private medical insurance is more affordable than they think, especially when you consider the value of faster treatment and better facilities. A great insurance policy can provide peace of mind and ensure you receive the care you need when you need it.
Benefits offered by private medical insurance
Private medical insurance provides numerous benefits that can significantly improve your healthcare experience and outcomes:Faster Access to Treatment
One of the biggest advantages is avoiding NHS waiting lists. While the NHS provides excellent care, waiting times can be lengthy. With private medical insurance, you can often receive treatment within days or weeks rather than months.
Choice of Consultant and Hospital
You can choose your preferred consultant and hospital, giving you more control over your healthcare journey. This is particularly important for complex treatments where you want a specific specialist.
Better Facilities and Accommodation
Private hospitals typically offer superior facilities, including private rooms, better food, and more comfortable surroundings. This can make your recovery more pleasant and potentially faster.
Advanced Treatments
Private medical insurance often covers treatments and medications not available on the NHS, giving you access to the latest medical advances and technologies.
Mental Health Support
Many policies include comprehensive mental health coverage, providing faster access to therapy and psychiatric care when needed.
Tax Benefits for Business Owners
If you're self-employed or a business owner, private medical insurance premiums can be tax-deductible, making it a cost-effective way to protect your health and your business.
Peace of Mind
Knowing you have access to private healthcare when you need it provides invaluable peace of mind, especially for those with ongoing health conditions or concerns about NHS capacity.
Private medical insurance is particularly valuable for those who want to take control of their healthcare journey and ensure they receive the best possible treatment when they need it most.
Important Fact!
We can look at a more suitable option mid-term!
Why is it important to get private medical insurance early?
👉 Many people are very thankful that they had their private medical insurance cover in place before running into some serious health issues. Private medical insurance is as important as life insurance for protecting your family's finances.👉 We insure our cars, houses, and even our phones! Yet our health is the most precious thing we have.
Easily one of the most important insurance purchases an individual or family can make in their lifetime, the decision to buy private medical insurance can be made much simpler with the help of FCA-authorised advisers. They are the specialists who do the searching and analysis helping people choose between various types of private medical insurance policies available in the market, including different levels of cover and policy types most suitable to the client's individual circumstances.
It certainly won't do any harm if you speak with one of our experienced insurance experts who are passionate about advising people on financial matters related to private medical insurance and are keen to provide you with a free consultation.
You can discuss with them in detail what affordable private medical insurance plan for the necessary peace of mind they would recommend! WeCovr works with some of the best advisers in the market.
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