A Guide to Private Medical (Health) Insurance

1. Why take out Private Medical Insurance?

Private Medical Insurance or Private Health Insurance, as it is more commonly referred to, is designed to allow you to get the treatment you need, when you need it and at the hospital of your choice. With reports of longer operation waiting times, a lack of funding within the NHS and concerns over MRSA and similar hospital "superbugs", many people are turning towards Private Health Insurance, as with many other forms of insurance, as a way of protecting and safeguarding the health and wellbeing of themselves and their family. Generally, patients will be able to choose from a wide range of Private Hospitals, pick their preferred specialist consultant and benefit from immediate admission and treatment, if required.

2. Types of cover available

There are a large range of schemes offered from a variety of Insurance providers but in most cases each plan offers cover for in-patient and day-patient treatment as standard. Thereafter, you can choose to include cover for outpatient treatments, physiotherapy, alternative medicine, dental benefits, chiropody, home nursing and even private maternity care. Most plans will also allow you the option to be treated under the NHS and receive a cash payment per day.

3. Cost of cover

Premiums will depend on the age and medical history of the policyholder and children are normally covered for free or at a fraction of the adult price, providing they are being included on an adult’s policy. You will also have the option of taking an excess to reduce the amount of premium, but remember this is the amount you will pay in the event of a claim. Many insurers offer a No Claims Bonus system, which will reward you if you don’t claim, but should you claim, be prepared for the premium to increase.

4. Arranging cover

Once you have chosen the type and level of cover you require, the insurance company will usually offer you the option of a Medical History declaration (or full medical underwriting) or a Moratorium.

Medical History declaration is where you will be asked a series of medical questions about your medical history, which will be used to form the basis of the contract between you and the insurers. In some cases the answers you give may result in an increased premium being charged, special terms being imposed including restricted cover or exclusions, or the insurers refusing to offer cover at all. Failure to disclose and medical information may result in the insurer refusing to pay a claim.

Moratorium is where you will not be asked any medical questions but instead, the insurer will automatically exclude and pre-existing medical condition. You may subsequently become eligible for cover for these conditions, if after a specified period of time you have received no further treatment, medication, advice or taken any tests in relation to the conditions.

5. Take advice

This guide is published for information only and no part of it should be construed as financial advice or recommendation. Before taking out any form of insurance or protection cover, we suggest that you speak to an FSA Authorised and Regulated financial advisor who can explain the cover in more detail and recommend the most suitable product for your requirements.