What is private health insurance?
Millions of people in the UK are covered by some form of private health insurance - also known as private medical insurance, or PMI.
But what is it? And how does it work?
At its most basic, private health insurance pays out for private treatment if you fall ill.
However, private health insurance doesn’t cover you for everything and differs from provider to provider.
The product is designed to pay for private treatment of medical conditions that respond quickly to treatment (usually called ‘acute’ conditions), as well as elective surgery and medical tests.
This guide explains exactly what you need to know about private health insurance - from how it works
What does private health insurance include and exclude?
What you are covered for depends on your provider, but there are some elements usually included in most policies. Elements with a ✓ are covered as standard and those marked with a ✘ are usually excluded.
✓ Inpatient treatment
Most policies cover the costs of inpatient treatment (where you need a hospital bed for the day or overnight), including tests and surgery.
✓ Outpatient treatment
Outpatient treatment (where you see a consultant or have diagnosis tests) is covered under many policies but the amount you can claim for may be capped.
Cheaper policies cover fewer types of outpatient treatment and have lower caps.
✓ Hospital accommodation and nursing care
A stay in hospital and limited nursing care is included in most policies.
✓ Exclusive drugs
Some policies will include drugs unavailable on the NHS, but that have been approved by the National Institute for Health and Care Excellence.
✓ Extra cover
Cover for psychiatric treatment varies between insurers. This is a difficult area for providers as it blurs the line between curable illness (which is covered) and long-term care (which isn't). Comprehensive policies may include psychiatric treatment, but not all do.
Some policies also offer complementary therapies, a private ambulance, home nursing, a 24-hour advice line, and parental accommodation if your child is in hospital. Again, a comprehensive policy is more likely to cover these areas.
✘ Pre-existing medical conditions
Private health insurance is easier to buy if you're healthy. Many insurers exclude pre-existing medical conditions, instead focusing on essential conditions that respond quickly to treatment.
This doesn’t mean, however, that private health insurance is unsuitable for those with pre-existing conditions, it just might be difficult to get the cover you need.
✘ Longer-term conditions
Your policy won't pay for longer-term treatment such as kidney dialysis, or illnesses such as asthma.
✘ Other conditions
Other exclusions include drug abuse, normal pregnancy, organ transplants, infertility and non-essential cosmetic treatments.
What are the different types of cover?
There are two main types of private health insurance – fully underwritten or moratorium policies.
Fully underwritten policies
If you choose fully underwritten private health insurance, you will have to give your provider your full medical history.
With a moratorium plan, you will only need to give limited information to your insurer.
Purchasing a moratorium policy is more convenient than going through your extensive medical history with your insurer - but fully underwritten plans can actually be cheaper and you'll know from day one which conditions you're covered and not covered for.
Some insurers also have specialist policies. For example, some only cover you when you have to wait longer than six weeks for NHS treatment. Other policies are designed specifically for the over-55s, or have a special focus on one disease, such as cancer.
Modular, pick-and-mix style policies are becoming more common. These cover you for in-patient treatments but also allow you to add cover for different things so that you tailor-make your insurance package.
Do I really need to be treated privately?
Private health insurance is not without its merits. We're lucky enough in the UK to have the NHS, which provides free healthcare at the point of need.
When we surveyed Which? members who'd undergone medical procedures within the past few years, we found that those who'd used the NHS were almost as often satisfied with the experience as those who'd gone private.
With those who'd chosen to use private healthcare, the most common reason cited for doing so were the waiting times faced for having the procedure on the NHS.
Private hospitals - which face less demand - claim to be able to deliver treatment much more speedily and at a time of your convenience.
Accessing private healthcare is far from cheap, as the table below shows. Private health insurance is, therefore, one means of fast-tracking lengthy waits without needing to have tens of thousands of pounds handy.
|Treatment||Cost of private treatment||Average wait time on NHS|
|CT scan||Up to £870||2.2 weeks|
|MRI scan||Up to £1,298||2.6 weeks|
|Cataract surgery||£2,140||12.4 weeks|
|Skin lesion removal||£940||6.5 weeks|
|Knee replacement||£11,814||13.5 weeks|
|Hip replacement||£10,776||13.5 weeks|
Private treatment costs taken from Goprivate.com (LaingBuisson), Aug 2018.
Average wait times are for NHS patients in England whose treatment started in Dec 2018. The following wait times are for the hospital department, not the procedure: cataract surgery - ophthalmology; skin lesion removal - dermatology; knee/hip replacement - trauma & orthopaedics
Scan costs depend on the complexity of scan.
How much does private health cover cost?
Like many other types of insurance, the costs of private health insurance vary depending on your circumstances and the specifics of the cover bought.
Similarly, where you live can have a dramatic effect on costs of treatment - and consequently, on the premium you'll pay.
Premiums also inevitably rise with age. In January, we analysed the premiums of 553 Which? members owning policies covering one person.
On average, customers under 65 reported paying £1,200 yearly. Meanwhile, those aged 65 and over were paying £2,000 on average.
The table below shows some illustrative quotations of what two couples (aged 35 and 55) would potentially pay annuallu if they sought cover for surgery, comprehensive heart and cancer cover and also cover for therapies (such as physiotherapy).
Costs could be considerably more for those with pre-existing conditions and/or previous claims.
|Provider||Policy name||35 year-old couple||55 year-old couple|
Comes with a six-week wait for treatment
|Limited Cover with Other Treatments & therapies||£749||£1,226|
|AXA PPP |
Comes with a six-week wait for treatment
|Core Cover with Therapies option||£1,247||£2,143|
|BUPA||Treatment & Care with Full Cancer Cover||£1,054||£1,972|
|CS Healthcare||Essential with Heart & Cancer and Therapy & Care options||£1,736||£2,921|
|The Exeter||Health+ with Therapies Cover||£886||£1,740|
Comes with a four-week wait for treatment
|Saver Plus with Extended Cancer cover||n/a||£1,431|
Quotes obtained from the insurers' websites in April 2019. We selected the cheapest combination of cover providing full inpatient care, comprehensive heart and cancer cover, and cover for therapies.
Outpatient cover was removed where it was possible to do so. We selected no excess, but did select a waiting time where offered. The couple was from South London, but we selected hospital lists excluding London hospitals where a choice was available
The best private health insurers for customer satisfaction
No private health insurer is truly delivering if they're letting you down on service.
We’ve surveyed 830 private health insurance policyholders to find out their experiences of using different insurers. All respondents surveyed have made at least one claim with their insurer within the last five years.
We've scored six private health insurers - Aviva, Axa PPP, Bupa, CS Healthcare, The Exeter and Saga.
To generate our Customer Score, we ask private health insurance customers how satisfied they are with their provider and how likely they would be to recommend the firm.
Which? members can log in to see the results of our analysis. If you’re not already a member, you can sign up to a one month trial for Which? Money for just £1 to access this review and enjoy the benefits of a Which? membership.
|Provider||Value for money||Ease of making a claim||Informing you of costs||Keeping you updated|
Customer Score sample sizes - Aviva (64), AXA PPP Healthcare (135), Bupa (281), CS Healthcare (49), The Exeter (32), Saga (45).
What do different private health insurers offer?
Aviva offers a comprehensive Private Health Insurance policy and two 'Health Essentials' products.
Private Health Insurance - offers 'Limited' and 'Full' Cover levels which both pay out for inpatient surgery, hospital charges and cancer treatment as standard, as well as certain outpatient benefits like scans, radiotherapy, and chemotherapy.
'Full' cover provides a wider range of additional benefits as standard, such as full outpatient cover, psychiatric cover, and physiotherapy - though both 'Full' and 'Limited' levels can be tweaked to include additional optional cover.
Health Essentials - Cancer Essentials pays a £5,000 benefit upon a diagnosis of cancer, and also up to £100,000 for drug costs not covered by the NHS. Physio Essentials, meanwhile, funds prompt access to private physiotherapists - in either a remote of face-to-face setting.
AXA PPP Healthcare is the second largest health insurer in the UK.
Its Personal Health Policy offers as standard inpatient treatment, including comprehensive cancer care - alongside outpatient surgery, tests, and scans.
You can tailor to increase the range of outpatient cover available and other extras, and add in a six week waiting period.
You can also scale back the cancer cover to 'NHS Cancer Support' to reduce the premium. With 'NHS Cancer Support', AXA doesn't pay for cancer treatment unless it's for licensed cancer drugs that aren't available through the NHS.
The largest health insurer in the UK, Bupa runs a wide network of private hospitals as well as offering insurance.
You can choose between its 'Treatment and Care' and more expensive 'Comprehensive' levels of cover. The core difference between the two is that the latter covers a wider range of outpatient tests and consultations than the former.
One area in which Bupa stands out is in offering a month's worth of treatment for mental health conditions as standard.
Within both Bupa's cover tiers, you can further adjust cover levels and excesses.
This includes a choice between full cancer cover and the more restrictive 'cancer cover plus' - which comes into play specifically to cover required cancer treatment not available through the NHS.
CS Healthcare is a mutual, friendly society which was established in 1929 to protect the health of civil and public servants.
You can take out a policy if you or a member of your immediate family work or have worked in the Civil Service, public sector or for a voluntary, charitable or not for profit organisation.
CS Healthcare is one of a minority of insurers to not offer no-claims discounts. Instead, its pricing is 'community rated', which means that your premium won't be directly affected if you make a claim.
The insurer offers two main insurance products - 'Your choice' and 'HealthBridge'.
Your choice - CS' comprehensive policy. Its core offering chiefly covers in-patient, day-patient and outpatient surgery and consultations. You can add extra modules to widen the range of investigations and tests, additional therapy and also heart and cancer treatment.
HealthBridge - Designed as an 'affordable' alternative to 'Your Choice', this mainly covers medical investigations, treatment and surgery with a benefit limit of £15,000, per person, per year, with treatment for heart or cancer conditions excluded.
Formerly known as Exeter Friendly, The Exeter offers one policy - Health+
As standard, you receive unlimited cancer cover, in-patient & day-patient treatment and outpatient surgery and scans.
However, you can add extra outpatient cover, include or exclude therapies, and include mental health cover.
You can also choose the pricing structure that will apply to you: no claims discount or 'community rated'. No claims discount is the cheaper of the two to begin with, but your premium will be directly impacted by your claims.
With a 'community rated' structure, the insurer adjusts your premium based on the overall number of claims made by a wider pool of customers.
Therefore individual claims you make will have a less pronounced effect on how your premium changes.
Saga provides insurance exclusively to customers over 50.
Saga offers five plans - ranging from 'Super' (the most comprehensive option) to 'Saver' and 'Support' - which are the most streamlined and only available by phone.
Super, Secure and Saver Plus all cover inpatient and outpatient surgery, chemotherapy, radiotherapy, and surgical cancer treatment, and scans and therapies - although benefit limits in some areas (such as scans) vary between the three.
Super adds elements such as mental health treatment and dental injuries benefit.
You can tailor and improve your policy so as to cover hypertension, add cash benefits for everyday health costs, and also extend the level of cancer cover so as to fund treatment of drugs not available on the NHS.
How do I buy cheap private health insurance?
Speak to a broker for help
Private health insurance is a complicated product so it's best to speak to a broker, especially if you have had medical problems or need specialist cover for certain illnesses.
To find a broker, check out the Association of Medical Insurers and Intermediaries (AMII). Comparison sites are a good starting point to find out how much coverage may cost.
Cut your costs by tweaking your policy
Once you have picked a policy, you can start to cut costs by tweaking the cover.
Start by considering your choice of hospitals. Most providers will give you a list to choose from and you may be able to cut costs if you opt for a shorter list.
Decide which parts of the cover are really important to you - as many insurers allow you to pick and choose from modules. For instance, dispensing with - or reducing - outpatient cover (for the most part, consultations with doctors and scans), can take hundreds off the annual premium.
Some insurers also provide an option of scaling back on fully comprehensive cancer cover - providing cover, for instance, that only kicks in if you need treatments or drugs that aren't available through the NHS.
Excesses, co-payments and wait periods
Next, think about adding an excess to your policy. If you're content to contribute to the cost of treatment yourself your premiums will fall, just make sure you can afford to pay the excess.
'Co-payments' are a variation on the excess theme. With a co-payment, you commit to paying a percentage of a claim's cost (say 10% or 15%) up to a maximum amount (say £1,000).
You'll receive a discount on the premium because you'll be leaning less on the insurer - but the maximum amount means you won't find yourself facing unaffordable amounts.
Also consider whether you'd be willing to have some treatment on the NHS. Many policies allow you to choose discounted cover that kicks in only where the NHS can't provide it quickly (usually six weeks). So, if speed of treatment is your main reason for going private, this can be a good compromise.
Beware ditching and switching
Private health insurance is nothing like car and home insurance where switching each year brings you savings. Trying to ditch your current provider to get a better deal can be tricky.
Any conditions you've developed over the life of your current policy are unlikely to be covered by your new provider as they'll be considered as pre-existing conditions.
Meanwhile, as you get older, and are considered more of a health risk by the insurance industry, your premiums will rise – making it tougher to find a cheaper deal.
If you're considering ditching and switching always check your potential new policy against your existing one to make sure it has everything you need.
Stay as healthy as you can
Some insurers will give you discounts if you stay healthy. Aviva's MyHealthCounts scheme, for example, rewards you with up to 15% off your renewal premium if you're fit and healthy.
What are the alternatives to private health insurance?
Private health insurance from your employer
This is more of an alternative way to pay for private health insurance, but many employers offer it as a perk of the job, and it's usually much cheaper than it would be if you paid yourself.
Employer private health insurance schemes are often more generous - for example, they may cover pre-existing conditions. And most insurers allow you to switch to a personal policy without losing your extras.
Healthcare cashplans are generally much cheaper than private health insurance - but are only designed to cover everyday health expenses such as dental work, glasses, contact lenses, and physiotherapy.
The cover you get is unlikely to extend towards the costs of serious medical treatment - such as an operation.
You pay a monthly premium, and the cashplan provider will reimburse you for medical expenses covered in the plan. There's an annual limit on how much you can claim, with more comprehensive policies having higher limits.
Critical illness cover
Critical illness insurance cover is often sold with life insurance and pays out a cash lump sum if you're diagnosed with one of a number of listed critical illnesses, including some types of cancer, a heart attack or stroke, multiple sclerosis or the loss of limbs.
A critical illness policy can be used to pay for anything - and so might include medical treatment costs, adaptations for your home (such as mobility aids, special equipment or structural changes required due to a disability), or to pay off your mortgage.
The one thing it doesn't do is provide a regular income, which income protection does.
The illnesses covered vary between insurers, so get advice before buying a policy and check the policy document. Pre-existing conditions tend to be excluded, but some insurers will base cover on your medical history
Find out more in our full guide to critical illness insurance explained.
How to claim on your private health insurance policy
Step one: Read your policy document
Different health insurers have different claims processes. If you're planning to seek private treatment, read the small print of your policy or check your insurer's website to see whether there's specific guidance.
Step two: Speak to your GP
Start by speaking to your GP about your condition as you normally would. Your GP can refer you for private treatment. There are two main types of referral; an open referral, where your GP doesn't address the letter to a specific consultant, or named referral, where a specialist is listed on the letter.
Read the terms and conditions of your policy to check which one your provider will want.
Step three: Call your private health insurance provider
Next, call your provider and explain the situation. What you'll need when you call will differ from provider to provider, but consider the following:
- Your policy number
- Details of what your GP told you
- Details about your condition
- Details of your referral.
Step four: Call your private health insurance provider (again) once you have seen a specialist
Once you have seen a specialist, call you provider again to let them know what steps will be taken next. Also, make sure you understand how you'll pay for any consultations or treatment – either you'll have to pay and claim the money back, or you'll provider will pay directly.
Step five: Don’t be afraid to complain
If your claim doesn’t pan out as you expect, or you feel that your insurer has treated you unfairly, don’t be afraid to complain.
Speak to your provider first, but if it isn't proving helpful (and you have exhausted their complaints process) take the matter up with the Financial Ombudsman Service by calling 0300 123 9123.