TL;DR
Understanding the difference between 'per claim' and 'per year' excess on UK private medical insurance is crucial; a mistake can double your costs. WeCovr's expert brokers, who have assisted in the issuance of over 900,000 policies, can help you navigate the fine print.
Key takeaways
- A 'per claim' excess is paid for each new, unrelated medical condition you claim for within a policy year.
- A 'per year' excess is paid only once per policy year, regardless of how many unrelated claims you make.
- Choosing 'per claim' can lead to multiple excess payments in one year, significantly increasing your out-of-pocket costs.
- Your policy schedule and IPID document will specify whether your excess is per claim or per year.
- An expert PMI broker can compare policies to find an excess structure that suits your potential needs and budget.
Navigating the world of private medical insurance (PMI) can feel like learning a new language. At WeCovr, where our experienced team has helped arrange over 900,000 policies of various kinds for UK clients, we know one of the most misunderstood and costly terms is the 'excess'. Getting this small detail wrong could mean paying double, or even triple, what you expected.
Why misunderstanding your policy excess structure can cost you double
You've chosen a private health insurance policy, confident you're covered. You see a £250 excess on your documents and think, "That's manageable." But what happens if you need to claim for a knee problem in February, a skin condition in June, and a separate back issue in October?
If your policy has a per claim excess, you could be paying that £250 three times, totalling £750. If it has a per year excess, you would only pay it once, for a total of £250. This is the trap. The seemingly small print on your excess structure is one of the most critical financial details of your entire policy.
This guide will demystify the difference, show you real-world examples, and explain how to choose a structure that is a strong fit for your personal circumstances and budget.
What is a Health Insurance Excess?
In simple terms, a policy excess (also known as a deductible) is the amount you agree to pay towards the cost of your treatment when you make a claim. The insurer then pays the remaining covered costs, up to your policy limits.
For example, if you have a £200 excess and your initial consultation and scans cost £800, you would pay the first £200. Your insurer would then cover the remaining £600.
Insurers use an excess for two main reasons:
- To reduce small claims: It discourages claims for very minor costs that you could pay out-of-pocket.
- To share the risk: It makes you a partner in the cost of your care, which helps keep overall premiums down.
The crucial detail, however, is how often you have to pay this amount. This is determined by whether your excess is applied 'per claim' or 'per year'.
Excess Per Claim: Explained in Plain English
An excess per claim (or per condition) means you must pay your chosen excess amount for each separate medical condition you claim for within your policy year.
Let's break this down. Once you pay the excess for a specific condition, you won't have to pay it again for any further treatment related to that same condition during that policy year. However, if a new, unrelated health issue arises, a new claim is started and you will have to pay the excess again.
Real-Life Example: Sarah's 'Per Claim' Policy
- Policy: Sarah has a PMI policy with a £250 excess per claim.
- January: She develops persistent shoulder pain. She sees a specialist and has an MRI. The total cost is £1,200.
- Sarah pays the first £250.
- Her insurer pays the remaining £950.
- May: Sarah needs follow-up physiotherapy for the same shoulder. The cost is £400.
- Sarah pays £0. The excess for this condition has already been met for the year.
- Her insurer pays the full £400.
- September: She develops a new, unrelated skin problem and needs to see a dermatologist. The consultation costs £300.
- This is a new claim for a new condition.
- Sarah must pay the £250 excess again.
- Her insurer pays the remaining £50.
Total Cost to Sarah in one year: £500 (£250 for the shoulder + £250 for the skin issue).
| Scenario | Treatment Cost | Excess Paid by Sarah | Insurer Pays |
|---|---|---|---|
| Claim 1: Shoulder | £1,200 | £250 | £950 |
| Follow-up: Shoulder | £400 | £0 | £400 |
| Claim 2: Skin | £300 | £250 | £50 |
| Total | £1,900 | £500 | £1,400 |
Pros of 'Per Claim' Excess:
- Often results in a slightly lower monthly premium.
Cons of 'Per Claim' Excess:
- Can become very expensive if you are unlucky and have multiple, unrelated health issues in one year.
- Less budget certainty – your total out-of-pocket costs are unpredictable.
Excess Per Year: Explained in Plain English
An excess per year (or per policy period) means you only have to pay your chosen excess amount once during your policy year, regardless of how many different, unrelated claims you make.
Once you have paid your total excess amount through one or more claims, you will have nothing more to pay towards any subsequent covered claims for the rest of that policy year. This is often the preferred and simpler structure for many policyholders.
Real-Life Example: Mark's 'Per Year' Policy
- Policy: Mark has a PMI policy with a £250 excess per year.
- January: He develops persistent shoulder pain. He sees a specialist and has an MRI. The total cost is £1,200.
- Mark pays the first £250.
- His insurer pays the remaining £950. His annual excess is now fully paid.
- May: Mark needs follow-up physiotherapy for the same shoulder. The cost is £400.
- Mark pays £0. His annual excess is already met.
- His insurer pays the full £400.
- September: He develops a new, unrelated skin problem and needs to see a dermatologist. The consultation costs £300.
- This is a new claim, but his annual excess is already paid.
- Mark pays £0.
- His insurer pays the full £300.
Total Cost to Mark in one year: £250 (paid once at the start of his first claim).
| Scenario | Treatment Cost | Excess Paid by Mark | Insurer Pays |
|---|---|---|---|
| Claim 1: Shoulder | £1,200 | £250 | £950 |
| Follow-up: Shoulder | £400 | £0 | £400 |
| Claim 2: Skin | £300 | £0 | £300 |
| Total | £1,900 | £250 | £1,650 |
Pros of 'Per Year' Excess:
- Excellent budget certainty. You know your maximum out-of-pocket cost for the year.
- Simpler and easier to understand.
- More cost-effective if you make multiple claims.
Cons of 'Per Year' Excess:
- May result in a slightly higher monthly premium compared to a 'per claim' policy with the same excess level.
The 'Per Claim' vs 'Per Year' Trap: A Direct Comparison
The true financial impact becomes crystal clear when you compare the two structures side-by-side in a multi-claim year.
Let's assume a £500 excess and a policyholder who has three separate, unrelated claims in one year.
| Scenario | Per Claim Excess (£500) | Per Year Excess (£500) |
|---|---|---|
| Claim 1: Knee Injury (£1,500) | You pay £500 | You pay £500 |
| Claim 2: Gastroscopy (£1,000) | You pay £500 | You pay £0 (annual excess met) |
| Claim 3: ENT Consult (£600) | You pay £500 | You pay £0 (annual excess met) |
| Total Out-of-Pocket Cost | £1,500 | £500 |
In this common scenario, the 'per claim' policyholder pays three times more than the 'per year' policyholder. This is the trap. A lower premium on a 'per claim' policy can be a false economy, quickly wiped out by the cost of just one additional claim.
Which UK Insurers Offer Which Excess Structure?
The excess structure is a core product feature that varies by insurer. While options can change, here is a general guide to what major UK PMI providers typically offer on their individual policies.
| Provider | Typical Excess Structure | Key Insight |
|---|---|---|
| Bupa | Per Year | Bupa's core offering, Bupa By You, operates on a per-year basis, providing cost certainty. |
| AXA Health | Per Year | AXA's Personal Health plan defaults to a per-year excess, a key feature they promote. |
| Vitality | Per Claim or Per Year | Vitality often provides the choice, allowing you to decide. This flexibility requires careful consideration. |
| Aviva | Per Year | Aviva's Healthier Solutions policy uses a per-year excess structure for simplicity. |
| The Exeter | Per Year | The Exeter's Health+ policy is built around a per-year excess model. |
Note: This information is based on standard individual policy offerings as of late 2025/early 2026 and is subject to change. Always check the specific policy documents before purchase.
As you can see, most major insurers have moved towards the simpler and more predictable per year model for their flagship individual plans. However, some insurers, especially on older or more basic plans, may still use a 'per claim' structure. This is why comparing the market with an expert broker like WeCovr is so vital. We can instantly check the fine print across dozens of policies for you.
How to Choose the Right Excess Level for You
Beyond the structure, you must also choose the amount of your excess. This typically ranges from £0 to £1,000 or more.
The rule is simple: A higher excess leads to a lower monthly premium.
- £0 or £100 Excess: You'll pay a higher premium, but your out-of-pocket costs will be minimal when you claim. This might be a suitable option if you prefer maximum financial predictability.
- £250 or £500 Excess: This is the most common range. It offers a good balance between a manageable premium and a reasonable amount to pay when claiming.
- £1,000+ Excess: This will significantly reduce your premium. It's effectively a way to self-insure for smaller issues while retaining cover for major, expensive treatments like surgery or cancer care. You are accepting more of the initial financial risk.
An adviser can model these different scenarios for you, showing you the precise premium saving for each excess level, helping you make an informed financial decision.
Critical PMI Reminders: What Your Policy Won't Cover
No discussion of PMI is complete without these essential reminders. UK private medical insurance is designed for a specific purpose.
- Pre-existing Conditions: Standard PMI policies do not cover medical conditions you had symptoms of, or sought advice for, before your policy began (typically in the last 5 years).
- Chronic Conditions: PMI is designed to treat acute conditions (those that are curable and short-term). It does not cover the long-term management of chronic conditions like diabetes, asthma, or high blood pressure.
- Emergency Services: A&E visits and emergency response are handled by the NHS. PMI is for planned, non-emergency diagnosis and treatment.
Understanding these core principles is as important as understanding your excess.
How WeCovr Can Help You Avoid the Trap
The PMI market is complex, and the 'per claim' vs 'per year' excess is just one of many details that can trip you up. As an FCA-regulated broking firm, WeCovr's role is to act as your expert guide.
- We Compare the Market: We have access to policies from across the UK's leading insurers and can instantly compare their features, including their excess structures.
- We Read the Fine Print: Our advisers are trained to spot these critical differences and explain them to you in Plain English.
- We Tailor to Your Needs: We take the time to understand your budget and health priorities to find a policy that is a strong fit for your circumstances.
- Our Service is at No Cost to You: We are paid by the insurer you choose, so you get expert, impartial guidance without an extra fee.
Furthermore, WeCovr customers gain access to added benefits, such as our AI-powered calorie and nutrition tracking app, CalorieHero, and can often secure discounts on other insurance products like life or income protection cover.
Your Final Checklist Before Buying
Before you sign on the dotted line for any PMI policy, make sure you can answer these questions:
- Is my excess applied per claim or per year?
- What is the exact amount of my excess (£)?
- Where is this stated? (Look for the Policy Schedule and the Insurance Product Information Document (IPID)).
- If I choose a higher excess, how much does my monthly premium decrease by?
- Have I fully disclosed my medical history according to the underwriting terms?
If you are unsure about any of these points, stop and ask. A quick call to an expert adviser can save you hundreds, if not thousands, of pounds down the line.
Don't fall into the excess trap. Let our team provide a clear, comprehensive comparison and a no-obligation quote to ensure your health insurance works for you when you need it most.
What happens if my treatment spans two policy years?
Can I change my health insurance excess?
Does my employer's PMI policy have an excess?
Is a higher excess always better for saving money?
Sources
NHS England Office for National Statistics (ONS) Financial Conduct Authority (FCA) gov.uk National Institute for Health and Care Excellence (NICE)
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