Fit­ness check for in­surance

The Jewish Chronicle - - FEATURES - BY DAN PARKER

COST IS a vi­tal con­sid­er­a­tion when de­cid­ing whether to take out — or con­tinue with — pri­vate med­i­cal in­surance. As prices con­tinue to rise well above the rate of in­fla­tion, how can you save money while main­tain­ing the com­pre­hen­sive cover you need?

Th­ese price hikes are due to the twin pres­sures of an age­ing pop­u­la­tion and ex­pen­sive new treat­ments, cou­pled with the fact in­surance pre­mium tax has risen from six per cent to 10 per cent since Novem­ber 2015 and will rise again, to 12 per cent, on June 1. Th­ese fac­tors com­bined have led to an av­er­age an­nual in­crease in pre­mi­ums of more than

£50 per per­son, ac­cord­ing to the As­so­ci­a­tion of Bri­tish In­sur­ers. This, in turn, has re­sulted in a re­duc­tion in the num­ber of in­di­vid­u­als pay­ing for pri­vate med­i­cal in­surance by one third since 1997.

But it is not all bad news: there are plenty of ways to re­duce your PMI pre­mium with­out com­pro­mis­ing your ben­e­fits or los­ing cover for pre-ex­ist­ing con­di­tions.

“So many peo­ple pay for op­tional ex­tras on their plan that they sim­ply don’t need,” says Mark Un­der­wood from Switch Health. “An independent, spe­cial­ist bro­ker can ac­cess all PMI providers to find you the best cover for the best price.”

As well as sav­ing you money, an ex­pert bro­ker will save you valu­able time you would other­wise spend scour­ing the mar­ket for the best deal. And they will not charge for this.

Many peo­ple see pri­vate med­i­cal in­surance as an un­af­ford­able lux­ury and are happy to rely on the in­con­ve­nience and long wait­ing times pro­vided by an ever-stretched NHS.

Un­for­tu­nately, the gov­ern­ment seems in­tent on pe­nal­is­ing the pri­vate health­care sec­tor, not ap­pre­ci­at­ing the value it adds to the UK econ­omy, as well as the sup­port it pro­vides to the NHS. A pre­dicted fur­ther in­crease in in­surance pre­mium tax, to 20 per cent by 2020, is just one ex­am­ple, while lack of com­pe­ti­tion in the mar­ket al­lows some hos­pi­tals to charge as­tro­nom­i­cal fees.

It does not help that treat­ment costs vary greatly across the coun­try. For ex­am­ple, an MRI scan can cost over £1,000 more in some hos­pi­tals than in oth­ers, while a hip re­place­ment ranges from £8,000 to £16,000, de­pend­ing on your lo­ca­tion. Th­ese vari­a­tions have led many in­sur­ers to in­tro­duce post­code band­ing to their PMI poli­cies, with cen­tral Lon­don — per­haps pre­dictably — the most ex­pen­sive re­gion. Cus­tomers who live in that area can find them­selves be­ing pe­nalised on price, whether or not they need to use the most ex­pen­sive hos­pi­tals.

In sum­mary, the best way to avoid in­creas­ing pre­mi­ums is to find a knowl­edge­able bro­ker who will re­view your ar­range­ments for you at no charge each year.

New reg­u­la­tions this month from the Fi­nan­cial Con­duct Author­ity put in­sur­ers and in­ter­me­di­aries un­der an obli­ga­tion to tell you there might be a bet­ter deal avail­able — even if sav­ing money re­quires shift­ing in­sur­ers. Ap­point­ing an ex­pert bro­ker means you will al­ways be ahead of the mar­ket and in con­trol of your costs.

Dan Parker is di­rec­tor of Switch Health, 01242 371300, switch­health.co.uk

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