If you have medical insurance (perhaps as a business) you’ll know how frustrating it can be when premiums increase when you knowingly haven’t claimed. We feel your pain too! But like any insurance whether it be medical, car, house, commercial…it’s rare the premiums come down. In our world of private medical insurance broking, what can we do to help alleviate this? I’ll come to that in a bit. For now, let broker MME explain why private medical insurance premiums increase:
- Age – The older you get the more premiums increase. As we age we’re more likely to need fixing. Insurers safeguard against this by adapting the cost to the age of the person or the average age of the group policy. Per person it’s about 2-5% each year.
- IPT (Insurance Premium Tax) – Currently running at 12%. All private medical insurance includes IPT. It’s a tax on insurances like VAT. It only really increases the premium if it goes up which it last did in 2017 from 10%.
- Medical Inflation 5% – This is a percentage increase placed onto premiums by insurers based on the cost of medical procedures, overall claiming patterns and future claim trends.
The above three affect premiums every year no matter what. Insurers choose to set increases to around 8-12% as standard. If your increase is much higher then there is one other understandable factor effecting premium increases on a private medical insurance policy:
- Claims – Whilst you are paying your premium others within your company policy may be claiming. However, normally your premiums would not increase unless the loss ratio is particularly bad. If you are paying £5,000 in premium for the year and someone in your scheme claims £5,000 then that’s a 100% loss ratio. Your premiums will go up. From experience, premiums tend to go up in line with claims once we get to 70-80% loss ratio or more.
What can we do at MME to help?
There is a lot we can do to help and have you pay less! A review of your policy against similar policies is the first step. Can anyone offer you the same cover for less? Or perhaps less premium but more cover. At this stage as your broker we are having many conversations with the insurers to make it work for you.
If we can get an alternative then can your current insurer be fairer? How much can they move? Are you a scheme worth keeping to them?
If moving from one insurer to another we’ll make sure that can happen with no negative consequences for your members. We wouldn’t move you if we thought that ongoing claims would not be covered.
So call us at Medical Made Easy broker your existing private medical insurance policy, find a new policy if you are looking at this for the first time, and other forms of employee wellbeing and rewards including some of our secret freebies.
Ask for Stefan.
0800 999 2205, 07419 764565