Every insurer works out the price of health insurance premiums a different way. In general, four things tend to drive prices up at renewal. Inflation, age, claims, and something that’s known as medical inflation. Here, we explain all four.
Inflation
Inflation is the rate at which the general cost of things goes up and, as a result, it’s not possible to buy as much for the same amount.
Unfortunately, this affects health insurance premiums too. So, to some extent, it’s ‘natural’ for your policy’s premiums to increase in price over time.
Medical inflation
Medical inflation is something that we cannot control. But in a way, it’s not all bad news.
Some of the price increases in private medical insurance reflect advances being made in medical technology. New treatments, new drugs, new facilities – they all come at a price, and some of that price is passed on to customers.
The cost of medical inflation changes from year to year, depending on how costs vary. We only recommend insurers who offer 5-star Defaqto-rated products – and we know that they monitor all of those costs, regularly.
The leading insurers we work with have teams looking at the prices for all kinds of medical treatments, making sure you’re getting value for money and appropriate care.
Age
We’re all getting older. It’s a sad fact of life that, as we age, we’re more likely to injure ourselves or suffer from an illness. In turn, that means it’s also more likely we’ll make a claim on a health insurance policy.
Each insurer takes a slightly different approach to the way they account for a policyholder’s age. Some insurers use age bands – from 60 to 70, for example, or from 85 to 90. When you move from one age band to the next, the price of your premiums is likely to go up.
Other insurers prefer to increase the age-related element of their premiums more gradually, year on year.
Claims
If you need to make a claim, there’s a great deal of peace of mind in knowing that a health insurance policy is there to help you. As with most insurance, if you don’t make a claim on your policy then you may get a discount when it’s time to renew.
Fortunately, much like car insurance, many private medical insurance policies now offer a No Claims Discount option. Some policies offer a protected No Claims Discount too, although, in itself, that may increase the policy’s premiums by a small amount.
Every insurer takes a different approach to No Claims Discounts. We’re happy to talk through your existing policy and explain how or why your premiums might have gone up.
Contact us now, and our expert Healthcare Consultants will be happy to compare health insurance policies from the leading UK insurers. We only recommend insurers who offer 5-star Defaqto-rated policies. We’ll only recommend a policy that’s right for your needs.
