My health insurance premiums have shot up; what can I do?

Why do premiums increase on renewal?

Health insurance renewal premiums can rise because of inflation, increasing treatment costs, your age and claims that affect your no-claims discount.

Here are the main factors that contribute to health insurance premium increases.

How general inflation affects health insurance premiums

Rising prices affect more than household bills; they also affect health insurance premiums. Higher inflation rates mean getting less for your money and paying more if you want your health insurance coverage to stay the same.

Inflation also impacts private health insurers as they may pay more for rent, utility bills and staff wages.

How medical inflation affects health insurance premiums

Medical inflation differs from general inflation as it focuses on the cost increases associated with medical treatments. The cost of medicines, hospital and consultant fees, and investment into cutting-edge treatments all contribute to medical inflation.

New equipment, medicines and treatments can increase the cost of providing healthcare. Those costs can contribute to higher health insurance premiums.

Why health insurance premiums rise with age

Your age can increase your health insurance renewal premium because the likelihood of needing treatment rises as you get older. Insurers reflect that risk in their prices.

Health insurance providers tend to group policyholders into age groups, meaning you can face a significant price hike when you move up a band. This isn’t always the case, as insurance providers differ in how they calculate premiums. Some adjust age-related premiums every year, giving a more gradual increase.

How claims can affect your health insurance renewal price

When you take out a health insurance policy, you’ll often start with a significant no-claims discount of 65-70%. If you don’t claim, your discount may increase until you reach your policy’s maximum. For example, Saga HealthPlan’s maximum is 60%, Aviva Healthier Solutions’ is 75%, and AXA Personal Health’s is 80%. A claim that affects your no-claims discount can reduce it and increase your renewal premium. The effect depends on your policy: some claims are exempt, and insurers use different thresholds and discount scales.

• Read our guide to how health insurance claims affect no-claims discounts here.

Chris Steele, founder of myTribe, explains:

“Many people take out health insurance thinking it works like car insurance, where you start with a 0% no-claims discount and build it up. It’s the opposite with private medical insurance. You start with a significant discount and then lose some of it when you claim, which can see premiums rise sharply.

When it comes to renewing your policy I would always recommend comparing providers to ensure you get the best cover at the best price.”

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What can you do if your health insurance premium has increased?

You can review your cover, compare quotes and negotiate with your current insurer to see whether you can reduce your renewal premium. If the increase is small, you may prefer to keep your existing cover and absorb the extra cost.

Adjust your cover level

Removing optional extras, lowering selected limits or increasing your excess may reduce your premium, but each change affects what you can claim. Check the practical effect before choosing a cheaper cover level.

Here are some of the main ways you could adjust your policy to reduce your premium.

Remove optional health insurance extras

Review the benefits you chose when you bought your policy and check which extras you still want to pay for. Inpatient treatment and cancer cover are included differently across policies, so check what you would lose before removing an option.

However, consider whether removing cover will also remove some of the benefits you get from your health insurance. For example, optional therapies cover can provide quick access to physical therapies that help you avoid NHS waiting lists and may prevent the need for surgery.

Reduce selected health insurance benefit limits

Some benefits have a monetary limit or a limit on treatment sessions, while others may have no yearly limit. Where your insurer offers a choice, a lower limit may reduce your premium.

Check which limits you can change and what the lower level would cover, rather than assuming that every benefit can be reduced separately.

Increase your health insurance excess

A health insurance policy excess works like a car insurance excess. You pay for the first part of your treatment, and your insurer pays the rest. Some insurers apply an annual excess so you only pay once, while others apply an excess for each claim.

A higher excess lowers your premiums, but check the small print to see how much you could end up paying. If you can’t afford the excess, you may be paying for health insurance you can’t use.

Choose a guided consultant option

Guided consultant choice can reduce your premium by limiting which specialists you can use. Depending on the plan, your insurer may select a specialist or offer a limited choice of recognised specialists. Check the referral process and whether you must use the insurer’s booking service before arranging treatment.

These are just a few ways to cut the cost of your health insurance. For the full list, including what each one means for your cover and how much it could save you, read our guide to reducing your private health insurance premium.

See what a different cover level would cost

Compare quotes from the UK’s leading insurers with the excess, limits and extras you choose.

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Switch to a new insurer

Switching health insurer may help you find a lower premium, but check the new cover and underwriting terms before deciding. If you are receiving treatment, the new insurer may exclude it. Continued underwriting can sometimes preserve cover for an existing condition, subject to the insurer’s acceptance and the new policy terms.

Health insurance excludes pre-existing conditions from cover, usually meaning any conditions you had symptoms of, or sought advice or treatment for, in the five years before buying a policy. This can make switching complicated. A new insurer will likely apply exclusions if you have had treatment on your previous policy, meaning your new policy may not cover the same treatment as the old one.

What should you check before switching health insurer?

Before switching health insurer, compare the price, benefits, exclusions and underwriting terms with your existing policy. A lower premium is only useful if you understand what the new cover includes and leaves out.

If you haven’t claimed and haven’t had symptoms, treatment or advice for any condition since your cover started, you should be able to switch without new exclusions being added. If you have, you’ll likely need to consider continued underwriting, known as CMORI or CPME, which we explain below.

Compare quotes before you renew

Comparing quotes once a year, or at least every other year, helps make sure your cover still suits you. Tell us what you’re looking for and we’ll get you comparison quotes from leading UK insurers.

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Switching with continued moratorium underwriting (CMORI)

Continued moratorium (CMORI) underwriting may let you switch while keeping your original moratorium start date, rather than starting a new moratorium. The new insurer must accept the transfer and may ask health questions or add exclusions.

Check the new policy’s requirements for bringing a previously excluded condition into cover. These may include a period without symptoms, medication, treatment or advice, rather than simply being symptom-free.

Switching with continued personal medical exclusions (CPME)

Continued personal medical exclusions (CPME) underwriting may let you switch from an existing fully medically underwritten policy while carrying its exclusions forward. The new insurer can ask health questions and may impose additional exclusions.

Cover for a condition you have already claimed for depends on the insurer’s acceptance and the new policy’s terms, limits and exclusions. CPME does not guarantee that later surgery, such as a hip replacement, will be covered.

Haggle with your current insurer

It’s worth shopping around and reviewing your health insurance coverage yearly to ensure you get the best coverage for your budget. However, you may not have to switch if you find a better deal elsewhere. You can haggle with your current insurance provider to see what they can offer.

Here’s how to get started.

Compare health insurance quotes before negotiating

It’s a good idea to get comparison quotes first to see what else is available. If you find a policy with equal (or better) coverage and terms at a lower price, you can use the evidence to start a conversation with your insurer. They’re much more likely to offer a better deal if they risk losing you to a competitor whose quote is already in your hand.

Ask your current insurer to review your renewal price

When insurance companies increase prices yearly, they often rely on the fact that most people won’t ever question the increases. We lead busy lives, and sticking with the insurer we know is far easier than shopping around.

Insurers often don’t give you their best prices when sending your renewal. Challenging the increase encourages them to offer you a lower premium, better coverage or additional perks for your money.

Looking for affordable health insurance?

Request a free comparison quote, and we’ll connect you with an experienced health insurance specialist to help you find the best policy at the best price.

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Consider self-insurance

If you’ve taken all these steps but still have an unaffordable insurance premium, self-insurance may be worth considering. When you choose self-insurance, you act as your own insurer, putting the money you would have spent on premiums into a savings account. Then, if you need treatment, withdraw the funds from your account instead of contacting your insurer. Most private hospitals will give you a fixed-price quote for surgery if you contact them directly.

This approach avoids the risk of spending hundreds of pounds on health insurance without ever claiming. You can also use the funds for another purpose if you wish. However, you run the risk that the fund you create isn’t enough to pay for your care. You may have enough to cover the cost of an operation but not ongoing cancer treatment.

Get help comparing your options

The steps above, apart from self-insurance, are easier with expert help. Compare quotes through myTribe, and one of our FCA-regulated partner brokers, who we vet and monitor, can help you compare cover and underwriting and talk to insurers for you.

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Contact us for a comparison quote to see what the UK’s leading insurers would charge for the cover you need. myTribe guides help you understand your private healthcare and health insurance options but aren’t a substitute for professional advice.