You are here: Home - Uncategorized -

FEATURE: A private matter

Written by:

Kate O’Raghallaigh examines private medical insurance and the benefits it could provide

None of us welcome the thought of becoming ill or injured, however, the reality is that at some point in our lives, many of us will require professional healthcare of some sort. Whether we are willing to rely on the NHS for this care or would prefer to go privately, will determine the decision to take out private medical insurance (PMI).

According to Bupa, the main reason for taking out PMI is to have access to clean hospitals. The latest research from the health insurer shows that 65% of PMI holders took out their policy because they believed the private hospitals provided a cleaner environment. Bupa’s figures also show that 60% of PMI holders thought they would be in less pain because they would face no waiting time for treatment in a private facility.

Nuts and bolts

But what exactly does PMI entitle you to – does it replace the cover you would otherwise receive on the NHS? Dave Priestley, sales director at Prudential, says those who think it provides a complete alternative are mistaken. He explains: “PMI is not a total replacement for the NHS because it excludes all chronic illnesses and only covers treatment of acute illnesses in secondary [hospital] care.”

This is the main distinction between the care received on the NHS and that which you can receive privately: PMI is usually only designed to cover treatment for curable, short-term (or ‘acute’, as insurers call it) illness or injury. Chronic or long-term illnesses such as diabetes or asthma, for example, would normally be ineligible for PMI cover. However, Julian Ross, head of policy at Standard Life, says there are some long-term illnesses that may still be covered. He explains: “If, for example, someone developed diabetes after they had taken out a policy, they could be covered for the initial treatment, but after that, the policy would not pay out.”

Cover for cancer treatment, while certainly not guaranteed, is not always ruled out either, adds Ross. He continues: “There has been a lot of debate about what should be considered chronic and there has been some general agreement that cancer is not always seen as chronic and therefore ineligible for PMI cover.”

What kind of cover should I go for?

With more than seven million people in the UK having some form of PMI, according to the Association of British Insurers, it begs the question of what kind of cover you should go for. There are three basic levels of cover, says Priestley. “A fully comprehensive plan typically covers both in and out-patient care. Medium level cover, which may have an annual limit of around £800 per year and could cover all in-patient care but limited out-patient care, and an in-patient policy only covers any treatment you receive during an overnight (or longer) stay in hospital, but nothing outside of that,” he continues.

There are also two different ways in which PMI policies are underwritten: full medical underwriting and moratorium. The former refers to policies that require you to sign a healthcare declaration – which is a healthcare questionnaire detailing your medical history – before taking out the policy. You are normally required to state any pre-existing conditions or injuries, including those likely to return at a later date. Moratorium policies do not require you to give a medical history, but instead will not pay out for any claims made during the first two years of the policy that are related to any conditions or injuries you may have sustained for five years before taking out the policy.


Premiums for PMI increase with age and so, for example, someone over 50 years of age could expect to pay a lot more than someone in their 20’s. For those of you on the lookout for a policy, it could be worth looking at one with a no claims discount. “For every year you don’t make a claim, you receive a discount on the next year’s premium, and in some cases, can earn more than 50% off your premiums,” adds Ross.

As Priestley pointed out, PMI does not provide access to a five star NHS. Primary health care is not covered and as long-term conditions are also excluded in most cases, you need to assess whether or not you would feel at ease knowing that you would be treated privately if you fell ill or had an accident. If you do decide to take out a policy, make sure you are honest with your insurer about your medical history – if you are not, this could affect your ability to make claims in the future.

Related Posts


Tag Box

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

ISAs: your back-to-basics guide for 2018/19

Here’s everything you need to know to make the most of your unused ISA allowance ahead of the 5 April deadli...

A guide to Sharia savings accounts

A number of Sharia savings products have upped their game in recent months, beating more familiar competitors ...

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
Retirement finances remain a worry

People facing retirement are more concerned than ever about their financial security and income, according to LV=.