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insurance: Health Insurance

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Health Insurance

Health insurance (more formally known as Private Medical Insurance or PMI) is designed to cover the cost of having private medical treatment. Taking out a policy can provide peace of mind that in the event of needing consultations, surgery or hospital care, it won't be necessary to rely on the NHS, and the appropriate treatment can be sourced quickly and comfortably.

Types of Health Insurance

There are two types of plan - full medical underwriting and moratorium underwriting, and both have their own advantages and disadvantages.

Full Medical Underwriting

In this sort of plan you would need to complete a detailed health questionnaire as part of the application process. This questionnaire is reviewed by the insurer who then decides whether to exclude you from claiming for certain medical conditions.

The disadvantage is that if you have suffered from a serious medical condition, such as cancer, it is likely that you would be excluded from claiming for this condition as part of that policy, even if you recovered over five years ago and have shown no signs of a relapse.

Where full medical underwriting has the edge is when you have only ever had minor health problems. They are likely to be overlooked, and will be covered under the policy from the start.

Moratorium underwriting.

This type of policy is more commonly chosen. With moratorium underwriting there is no need to provide any medical information up front. However, if you had to seek medical advice for a condition in the five years prior to taking out a policy, this condition would not be covered during the moratorium period.

With no need to provide medical information it's much quicker to set up, and if you've been in good health in the five years leading up to taking out the policy there will be no excluded conditions. Moratoriums are normally cheaper too.

However, even minor conditions suffered in the five years before the policy starts are excluded if they reappear within two years.

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Do I need Health Insurance?

With universal free health care in the UK, health insurance isn't a necessity. However, it can help avoid long NHS waiting lists and enable you to exert an element of control over the treatment you have and where you have it.

Having said that, accident and emergency treatment is not covered by health insurance, and with serious conditions you might not receive treatment any quicker. It's also possible that you'll end upon in an NHS ward in any case.

Things to Consider

  • Cost - Health insurance can be expensive, and should not be a priority unless all your other finances are in order;
  • Premiums tend to rise annually, although some have a no claims bonus;
  • If your employer offers PMI and you retire or change jobs you might be able to switch to a personal policy without losing benefits.

How Much Does Private Health Insurance Cost?

The prices of PMI vary considerably with the type of policy; such factors influencing the cost of health insurance include the following:

  • Treatments covered by the policy
  • Age
  • State of health, past and present
  • Whether you are a smoker.

In addition, you should take note that premiums increase every year in line with medical costs and the increasing number of older people using the system. There are premium discounts if you pay an upfront lump sum or choose to accept an excess on amounts claimed

Top Providers


BUPA is the best known health insurer in the UK and provides a wide range of services to cater for a variety of needs.


Aviva is a general insurer which provides health insurance as part of its product range. As a large company they also offer a variety of options.


AXA PPP Healthcare is the division of the French multi-national investment bank that provides PMI. They provide insurance for individuals and businesses.


WPA is a not-for-profit provider of health insurance that prides itself in providing a fair and transparent service.

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