Understanding PMI Policy Renewals and Annual Reviews
Your private medical insurance (PMI) renewal letter has just landed on your doormat, and the new premium has made you raise an eyebrow. You're not alone. At WeCovr, an FCA-authorised broker that has helped arrange over 900,000 policies of various kinds, we know that understanding your renewal is the key to managing your health cover effectively in the UK.
Staying on top of price changes, benefits, and optimal switching strategies
An annual PMI renewal is more than just a price update; it’s your yearly opportunity to ensure your policy still offers the best possible value and protection for you and your family. With NHS waiting lists remaining a significant concern—with millions of treatment pathways incomplete according to recent NHS England data—having the right private health cover is more important than ever.
This guide will walk you through everything you need to know about your renewal, from decoding price hikes to mastering the art of switching providers without losing crucial cover.
Why Do PMI Premiums Increase Every Year?
It's the most common question we hear: "I haven't even claimed, so why has my premium gone up?" Several factors, often working together, contribute to annual price increases. Understanding them is the first step to taking control.
Key Factors Influencing Your Renewal Premium
| Factor | Description | Why It Increases Your Premium |
|---|---|---|
| Age | As we get older, the statistical likelihood of needing medical treatment increases. | Insurers adjust prices based on age bands. Moving into a new band (e.g., turning 40, 50, 65) often triggers a significant price rise. |
| Medical Inflation | The cost of private medical care—new drugs, advanced diagnostic scans, hospital fees, and specialist consultants—rises faster than general inflation. | Insurers pass these rising operational costs onto customers. Medical inflation in the UK typically runs between 5% and 10% annually. |
| Your Claims History | Making a claim can impact your No Claims Discount (NCD). | Similar to car insurance, a claim will usually reduce or reset your NCD, leading to a higher premium the following year. |
| Insurer's Portfolio Performance | If the insurer's overall pool of customers claimed more than expected in the previous year, they may adjust prices for everyone to balance their books. | This is a general risk adjustment across the board, affecting even those who did not claim. |
| Insurance Premium Tax (IPT) | This is a tax levied by the UK government on all general insurance premiums, including PMI. The standard rate is currently 12%. | Any increase in the IPT rate by the government is passed directly on to you. |
Real-Life Example:
Meet Sarah, a 49-year-old marketing manager. Her premium last year was £75 per month. This year, her renewal quote is £95 per month. Here's a possible breakdown:
- Age-related increase: She is approaching 50, a key age bracket. (+£8)
- Medical inflation: The insurer applies a 7% increase to cover rising hospital costs. (+£5.25)
- Claim impact: She had a small claim for physiotherapy, which reduced her NCD level. (+£6.75)
Total increase: £20 per month. By understanding these components, Sarah is better equipped to discuss her policy with a broker and explore her options.
A Crucial Reminder: Pre-existing and Chronic Conditions
Before we go any further, it's vital to understand a fundamental principle of standard UK private medical insurance.
PMI is designed to cover acute conditions that arise after you take out your policy. An acute condition is one that is curable with treatment, such as a cataract removal or a joint replacement.
Standard PMI policies do not cover:
- Pre-existing Conditions: Any illness, injury, or symptom you had before the policy start date.
- Chronic Conditions: Long-term illnesses that cannot be cured, only managed. Examples include diabetes, asthma, arthritis, and high blood pressure.
This is the single most important concept to grasp, especially when considering switching insurers. We will cover how this affects your switching strategy later in the article.
Your Annual Review: A Step-by-Step Checklist
Don't just glance at the price on your renewal notice and file it away. Use it as a prompt to conduct a full health-check on your policy.
Here’s a simple checklist to follow:
-
Scrutinise the Premium: Is the increase in line with what you expected? Does it feel justifiable based on the factors we've discussed? An increase of 5-10% might be normal, but a 30-40% jump warrants a serious review.
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Review Your Benefits and Cover Levels: Have your needs changed?
- Hospital List: Does your policy still include the hospitals you would want to use? Some insurers update their lists, occasionally moving a preferred local hospital to a more expensive tier or removing it.
- Outpatient Cover: Is your limit for specialist consultations and diagnostic tests (£500, £1,000, or unlimited) still appropriate? If you haven't used it, could you reduce it to save money?
- Excess Level: Your excess is the amount you pay towards a claim. Increasing your excess (e.g., from £100 to £250 or £500) is one of the quickest ways to lower your premium.
- Therapies Cover: Does your policy include cover for physiotherapy, osteopathy, or chiropractic treatment? Is this still important to you?
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Check for Policy Wording Changes: Insurers can and do change the terms and conditions of their policies at renewal. These are usually detailed in the document pack. Look out for new exclusions or changes to how benefits are paid.
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Assess Your Lifestyle and Future Needs: Are you planning a family? Thinking about retirement? Your health insurance should adapt with you. Perhaps you now want a policy with more comprehensive mental health support or access to virtual GP services.
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Consider Wellness Programmes: Many of the best PMI providers (like Vitality, Bupa, and Aviva) offer wellness programmes that reward healthy living. They might offer cinema tickets, coffee, or even discounts on your renewal premium for tracking your activity, getting health checks, and maintaining a good diet.
The Power of Proactive Health Management
Taking charge of your health isn't just good for you—it can be good for your wallet. Insurers are increasingly focused on prevention. By engaging with their wellness apps and programmes, you demonstrate that you are a lower-risk customer.
Simple Tips for a Healthier Lifestyle:
- Balanced Diet: Focus on whole foods, fruits, vegetables, and lean proteins. Using a calorie and macro tracking app can be incredibly insightful. As a WeCovr client, you get complimentary access to our premium AI-powered app, CalorieHero, to make tracking your nutrition simple and effective.
- Regular Activity: The NHS recommends at least 150 minutes of moderate-intensity activity a week. This could be brisk walking, cycling, or swimming. Find something you enjoy to make it a sustainable habit.
- Prioritise Sleep: Aim for 7-9 hours of quality sleep per night. Poor sleep is linked to a host of health issues, including a weakened immune system and poor mental health.
- Manage Stress: Incorporate mindfulness, meditation, or simple breathing exercises into your day. Even 5-10 minutes can make a difference.
Engaging in these activities can directly link to rewards and potential premium savings with certain private health cover providers.
To Stay or To Switch? The £1,000,000 Question
After reviewing your renewal, you have two main choices: stay with your current insurer or switch to a new one. This decision requires careful consideration, especially regarding your medical history.
The Case for Staying
It can be tempting to stick with what you know. This might be the right choice if:
- You've recently claimed or are undergoing treatment: Switching insurers mid-treatment is generally not possible or advisable. Your new insurer will not cover an ongoing condition.
- You've developed new medical conditions: If you've developed conditions since you first took out your policy, they are covered by your current insurer. A new insurer would classify them as pre-existing and exclude them.
- The renewal increase is reasonable: If the price rise is modest and you are happy with the service and cover, staying put offers continuity and peace of mind.
- Your insurer offers loyalty benefits: Some insurers may have benefits or underwriting terms that improve the longer you stay with them.
The Case for Switching
Brand loyalty in insurance rarely pays. Insurers often reserve their most competitive prices for new customers. You should seriously consider switching if:
- The premium increase is substantial: If your premium has jumped by 20% or more without a clear reason (like a major claim), the market will almost certainly have a better-value option for you.
- Your needs have changed: You might find another insurer offers a better hospital list, more flexible outpatient cover, or superior mental health support for a similar or lower price.
- You have a clean bill of health: If you and your family have had no new diagnoses since your policy began, you are in a prime position to switch and take advantage of new business discounts.
Comparing Switching Options: A Pros and Cons Analysis
| Decision | Pros | Cons |
|---|---|---|
| Staying with your current insurer | - Continuity of cover for existing conditions. - No need for new medical underwriting. - Familiarity with the provider and process. | - Likely paying more than a new customer. - May miss out on better benefits or innovations from other insurers. |
| Switching to a new insurer | - Potential for significant premium savings. - Access to better or more relevant benefits. - Opportunity to choose a policy that better fits your current needs. | - Crucially, any conditions developed under your old policy will now be 'pre-existing' and excluded by the new one. - Requires a new underwriting process. |
Understanding Underwriting: The Key to a Successful Switch
When you switch, your new insurer needs to assess your health risk. This is done through underwriting. The two main types for people switching are 'Moratorium' and 'Full Medical Underwriting'.
A specialist PMI broker can help you navigate this, but here’s a simple breakdown:
| Underwriting Type | How It Works | Best For... |
|---|---|---|
| Moratorium (MORI) | You don't declare your full medical history upfront. Instead, the insurer automatically excludes any condition you've had symptoms, advice, or treatment for in the last 5 years. This exclusion can be lifted if you remain completely symptom, advice, and treatment-free for that condition for a continuous 2-year period after your policy starts. | People who are generally healthy and haven't had any significant medical issues in the past 5 years. It's quicker and less intrusive. |
| Full Medical Underwriting (FMU) | You complete a detailed health questionnaire, disclosing your entire medical history. The insurer then reviews this and states upfront exactly what will and will not be covered. These exclusions are typically permanent. | People who have had health issues more than 5 years ago, or who want absolute certainty from day one about what is covered. |
Switching with Continued Underwriting:
Some insurers offer special terms for switchers, known as 'Continued/No Further Underwriting' or 'CPME' (Continued Personal Medical Exclusions).
- How it works: The new insurer agrees to match the underwriting terms of your old policy. They will continue to cover the conditions your old insurer was covering, and maintain the same exclusions you already had.
- Why it's great: This is the "gold standard" for switching. It allows you to move to a cheaper policy without losing cover for conditions you've developed.
- The catch: It's not always available and depends on your claims history and the insurers involved. An expert broker is essential for finding these opportunities.
The Role of a Specialist PMI Broker
You can spend hours calling individual insurers and trying to compare complex policies yourself. Or, you can use a specialist independent broker.
A good broker does more than just find the cheapest price. They act as your expert advisor.
Why use a broker like WeCovr?
- Market Access: We have access to a wide range of policies and insurers, including deals not available to the public. We can compare the entire private medical insurance UK market in minutes.
- Expert Advice: We understand the fine print. We can explain the differences between policies and help you choose the cover that’s right for your specific needs and medical history. Our team can advise on the best underwriting method for your situation.
- No Cost to You: Our service is free. We are paid a commission by the insurer you choose, which is already built into the premium. You pay the same price (or often less) than going direct.
- Hassle-Free Switching: If you decide to switch, we handle all the paperwork for you. We can manage the complex process of securing continued underwriting terms, ensuring you don't lose any important cover.
- Annual Review Service: We don’t just help you once. Every year, we will proactively contact you before your renewal to review the market again, ensuring you are always on the best possible policy. Our high customer satisfaction ratings reflect our commitment to long-term client support.
- Additional Benefits: When you arrange a policy through WeCovr, you also get complimentary access to the CalorieHero AI nutrition app and may be eligible for discounts on other insurance products like life or income protection cover.
An independent broker works for you, not the insurance company. Our goal is to ensure you have the right protection at the fairest price, year after year.
Final Checklist: Your Renewal Action Plan
Your renewal letter has arrived. What now?
- Don't Panic, Don't Ignore: Open it immediately. Note the renewal date—you typically have up to this date to make a change.
- Analyse the Offer: Use our checklist from earlier to review the new premium, your benefits, and any policy changes.
- Assess Your Health: Have you or your family members developed any new conditions since you first bought the policy? This is the most critical factor in your decision.
- Contact an Expert Broker: Get in touch with the team at WeCovr. Provide us with your current policy details and renewal offer.
- Review Your Options: We will conduct a full market review and present you with clear, easy-to-understand options: your renewal price vs. quotes from other leading PMI providers. We will explain the pros and cons of each, including the underwriting basis.
- Make an Informed Decision: With all the facts at your disposal, you can confidently decide whether to stick or switch.
- Relax: If you switch, we handle the entire process. If you stay, you do so with the confidence of knowing you've explored the alternatives and are still on the right plan.
Your annual health insurance renewal is the perfect moment to take control of your cover and costs. By being proactive and seeking expert advice, you can ensure your policy continues to provide the security and peace of mind you and your family deserve.
Frequently Asked Questions (FAQs)
Will my PMI premium always go up every year?
Can I switch my private health cover if I've developed a new condition?
What is the difference between moratorium and full medical underwriting?
Do I have to use a PMI broker to switch insurers?
Ready to see if you could get better value on your private medical insurance? Get a free, no-obligation quote from our expert team at WeCovr today and let us do the hard work for you.
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.
By tapping the button below, you can book a free call with them in less than 30 seconds right now:
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Who Are WeCovr?
WeCovr is an insurance specialist for people valuing their peace of mind and a great service.👍 WeCovr will help you get your private medical insurance, life insurance, critical illness insurance and others in no time thanks to our wonderful super-friendly experts ready to assist you every step of the way.
Just a quick and simple form and an easy conversation with one of our experts and your valuable insurance policy is in place for that needed peace of mind!