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Business health insurance

Thinking about getting PMI for businesses?

Download our free PDF guide

Business health insurance helps you to look after your employees when they need help most. It can be an important part of a recruitment and retention strategy, helping to attract and keep the right people and boost workplace morale. 

Policies are designed to provide cover to diagnose and treat acute conditions that are likely to respond quickly to treatment, leading to a full recovery and returning your employees to their previous state of health. 

Who do I cover?

  • You can include everybody in the business. However, you may choose to limit cover to:
  • Principals (such as owner, partner, managing director or CEO) only.
  • Paid directors and other senior employees.
  • Loyal employees who have been with you a while.

Some insurers will allow you to arrange cover on the number of employees, others may offer groupings by title, and others may want to specify names.

The need for business health insurance

Feeling unwell can be stressful enough, without having to wait for appointments or tests. NHS waiting lists mean that it is not always easy to be seen quickly. Private healthcare costs can mount up, so insurance is a cost effective way to get diagnosis and treatment promptly.

Why consider business health insurance? 

Going private has the advantage that employees can book appointments at a time that suits you and them. Health insurance offers choice, flexibility and speed of access to tests, scans and treatment. Rather than allowing the NHS to dictate when and where you and your employees are treated, private insurance offers flexibility, which suits everybody. Being able to get prompt access to treatment also means that people are not working while under par, or off work whilst waiting for treatment. 

Benefits for the business:

  • It controls health costs.
  • Offers private healthcare as a tangible employee benefit.
  • Helps attract and retain talented and skilled staff.
  • Treatment timing can fit around business needs.

Benefits for employees:

  • It's a useful and valuable employee benefit.
  • They can access the consultations and treatment they need quickly.
  • Offers peace of mind that they can access care at a comfortable private hospital.
  • Takes the hassle out of arranging treatment.
  • Free and reliable healthcare information online and on the phone.

Partners and children

Some insurers automatically include partners and children; others offer this as an extra, while some only offer business cover to those working in the business.

If workers are worrying about health problems of their partner or children, then their mind is not going to be fully on their work. Taking care of their families takes the pressure off.

Business health insurance 

Health insurance pays towards some of the medical bills on private treatment. It gives a choice in the level of care, plus how and when it is provided. The core cover usually includes in-patient treatment (tests, scans and surgery), day surgery, specialist referrals, a private room and physiotherapy. It may also include radiotherapy and chemotherapy.

Building your own policy

Most insurers allow you to add extra cover to build a policy to suit you.
Extras on offer or in the core cover can include:

  • Outpatient surgery.
  • Outpatient consultations and specialists.
  • Outpatient scans and tests.
  • Specialist diagnosis. 
  • Extra outpatient services. 
  • Alternative therapies and treatment.
  • Mental healthcare.
  • NHS cash benefit for each night in hospital.
  • Ambulance transfers.   
  • Treatment at home.
  • Homecare and nursing.
  • Travel cover.
  • Dental treatment.
  • Eye care.
  • Rehabilitation assistance.
  • Back to work assistance.

Help and assistance

Most insurers offer 24/7 online and/or telephone information. Other services may include:

  • Discounts on healthcare.
  • Discounts on healthy living and shopping.
  • No claim or healthy living discounts.
  • Appointment booking service

How business health insurance works

If the employee’s GP recommends tests to aid a diagnosis, a consultation or treatment, then they will give them a letter of referral. This is where health insurance steps in. Private cover can ensure that they are seen as quickly as possible by specialist therapists, doctors and consultants. This could either be in a private or NHS hospital. 

Insurers vary as to whether they allow free choice of hospital and/or consultant. Some limit choice to ones they want people to use. When arranging cover you may be offered a choice of a specific national network, London hospitals, specialist hospitals, or even a specific hospital or chain of hospitals. 

Treatment overseas

Most insurers do not cover planned treatment outside the UK.

What business health insurance offers for cancer

Many policies include or offer the option of including cancer cover for treatment, cancer drugs and support. This usually includes tests, scans and diagnosis, plus hospital treatment and outpatient therapies. It may include maintenance and monitoring. The NHS may not be able to provide an expensive licensed cancer drug recommended by the patient's specialist. Some policies cover the cost of such drugs and the costs of administering them. They may also pay for treatment at home, such as chemotherapy.

Cancer cover differs between policies

Insurers are widening what they offer on cancer and some even include stem cell and bone marrow transplants, bone scans, agreed experimental treatment, wigs, prostheses, rehabilitation, post treatment monitoring, specialist nursing, home care and end of life/hospice care. Insurers may also offer telephone support from cancer nurses.

You should check to see if there is an overall financial limit, limits for particular treatments, and what in-patient, daycare and outpatient cover is on offer. Some insurers offer various options of:

  • Allowing the NHS to treat but paying cash sums per day/night.
  • Limiting cover to any treatment not free under the NHS.
  • Letting the NHS cover initial diagnosis and then covering private treatment.

More comprehensive cancer cover

Insurers vary greatly as to what they cover or offer on cancer care. No two policies are the same and it is not always clear if the core cover includes more comprehensive cancer cover or just radiotherapy and chemotherapy.

Typical policies allow you to put together the package that suits you, and there are usually several options.

Chronic conditions

Health insurance does not usually cover any chronic condition, unless insurers agree that cover is specifically included. A chronic condition is a disease, illness or injury that needs ongoing or long-term monitoring through consultations, examinations, check-ups and/or tests; needs ongoing or long-term control or relief of symptoms, or it recurs or is likely to recur.

Pre-existing conditions

Health insurers will not automatically cover any pre-existing condition, but may agree to do so. A pre-existing condition is any disease, illness or injury for which a person has received or is receiving medication, advice or treatment; or has experienced symptoms.

What business health insurance does not cover

Every insurer is different, but key areas that are not covered may include:

  • Normal pregnancy and childbirth.
  • Transplants.
  • Cosmetic surgery.
  • Experimental treatment.
  • Dialysis.
  • GP charges and services.
  • Rehabilitation and convalescence.
  • Accident and emergency admission.
  • Accident and emergency outpatient treatment.
  • NHS prescriptions.

Saving money

Your choice of cover will affect what you pay. You may have the option of including or excluding specific covers. Other choices include:

  • A deductible where you pay an agreed amount of the bill.
  • Choosing a different grade of hospital accommodation.
  • Paying for a percentage of your treatment.
  • Receiving treatment under the NHS when it is available within 6 weeks.
  • Choosing to receive treatment at a specified hospital.
  • Excluding outpatient cover.
  • Capping limits on specific cover.
  • Paying the premium annually rather than monthly.

Children

Insurers may include free cover for children under 18. Some insurers will include children in further education up to 25. A few insurers offer special policies just for children. Most health insurance policies include cover for rooms when a parent has to accompany a child in hospital.

Age

Insurers vary as to whether they will cover people up to any age or whether they have restrictions on acceptance age, or even age at which cover ends; common ages are 60, 65 or 70. Some insurers charge more to older people, others do not, and some have very strict limitations on the age groups they will cover. 

The difference between a health cash plan and health insurance

A health cash plan offers money back on everyday healthcare bills, like trips to the optician, dentist or physiotherapist, up to agreed annual limits. Health insurance covers for tests and treatment for acute medical conditions.

Using a cash plan, the insured person arranges the treatment without asking the insurer, pays for it, and seeks a refund from the insurer for all or part of the cost. 

With health insurance, customers seeking tests or treatment have to ask the permission of the insurer in advance on the treatment and location. The cost is usually billed direct to the insurer who pays it less any agreed deductible, excess or co-pay for which the individual is responsible.

Underwriting the cover

This is one area where jargon cannot be avoided, but how insurers underwrite your policy is important to understand. When it comes to underwriting, different insurers offer different options-

Full medical underwriting 

Insurers ask you and your employees questions about past health. Any pre-existing medical conditions and related conditions will be excluded unless insurers agree to accept them.

Moratorium

This replaces filling out a health questionnaire. Instead, an automatic exclusion applies for any pre-existing conditions (see page 8) and in some cases, other specified conditions. This may be limited to conditions within a set period of time, before being insured. There may also be rules which allow cover for these conditions, if the person has been free of any treatment, including medication, investigations, special diets or any advice for the pre-existing condition(s).

Medical history disregarded

This means that insurers do not apply any medical exclusions, but this is usually only for schemes covering 20 or more people.

The cost

This depends on the number of people covered, how much cover is chosen, your type of business and location, whether people covered have existing or previous health problems, and the age range of those covered. It is always best to get two or three quotes from different sources, and ask each of them about anything that is unclear.

Asking employees to share the costs

Whilst many businesses offer insurance as an employee benefit, some do ask employees to contribute to the premium. Always ask your insurer if they allow this, then check the legal and tax position with your accountant. 

Helping you choose

There are many health insurers offering cover for smaller businesses, and often they have a range of products or options, and this can be confusing. You can go direct, or go via a specialist insurance intermediary. Some intermediaries charge fees as well as taking commission.  If using an intermediary it is possible to use a health insurance specialist, and to ensure that they have access to several insurers and are not just tied to one or two. As well as using their specialist knowledge, they often have access to insurers and plans that you cannot buy direct as a customer.

Thinking about getting PMI for businesses?

Download our free PDF guide

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A guide to health insurance for small and medium businesses

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