Karen Woodley
|Head of Healthcare Distribution
The private health insurance landscape is shifting in the UK as the cost of living crisis pinches budgets and prompts consumers to consider cutting costs. This article explores the value of health insurance in this context.
The private health insurance landscape is shifting in the UK as the cost of living crisis pinches budgets and prompts consumers to consider cutting costs. Alongside ending monthly subscriptions and reducing food bills, some individuals are thinking about cutting back on insurance cover to save money, and this includes their private health insurance cover1. Yet, with the NHS facing lengthy waiting times and easy access to healthcare remaining a worry for consumers, getting rid of a private health insurance policy might not be a prudent choice.
In the coming months, advisers have a critical role to play in guiding consumers on these decisions, and one way they can make the case for keeping a policy in place, is to highlight the often-overlooked benefits it provides.
Pressure builds on UK healthcare.
Recent figures from the NHS show that 7.2 million people were waiting to start routine treatment at the end of December 2022, with a median waiting time for treatment of 14. 6 weeks – far higher than the pre-Covid median of 8.4 weeks in January 20202. The NHS continues to provide a valuable service for many people but growing patient backlogs have highlighted the value of private healthcare for some. But what exactly are these benefits?
Accessing care quickly through a health insurance policy does not just help avoid the stress of waiting. Conditions that are left untreated may become more serious or even life-threatening over time, resulting in poorer outcomes. For example, for every week delay in making a cancer diagnosis, an individual's chances of survival reduce by around 1%, highlighting the importance of catching illnesses early rather than waiting for elective treatment3.
This is not only the best-case scenario for the client’s health but also their finances. If someone falls ill without a health or financial safety net and is unable to work for an extended period, the lost income will take a heavy toll on their financial and mental wellbeing.
Ongoing, flexible support
Health insurance is about more than claiming back costs for elective surgery, as many may assume. Managing health over the long term is also a priority, and insurers are increasingly offering products that provide access to a wider variety of health and wellbeing support services.
Take our figures from Healthwise, The Exeter’s member benefits app, which recorded a jump in usage of its services by 10% year-on-year from 2022 to 2023. Clients are taking action to protect themselves, leveraging modern health insurance offerings with value-added benefits to access care without delay. There was a 7.5% rise in remote GP appointments, while most physio treatments and mental health support were delivered remotely4.
Customers are increasingly benefitting from these solutions, and the ability to access them flexibly, is particularly important given we all lead increasingly busy lives.
Almost every insurer will offer a policy with some degree of value-added benefits, like Healthwise, to help individuals proactively manage their health. Whether addressed through remote GP appointments, medical consultations, or expert advice, these benefits can help manage conditions before they get worse.
The role of the adviser
Between rising NHS waiting times and the cost of living crisis, advisers can expect clients to be weighing up the financial costs of a private health insurance product.
Advisers play a naturally important role in guiding clients toward the right decision, but it’s not enough to expect customers to get in touch with questions. Instead, this year they will need to proactively reach out to highlight the benefits of policies, either during initial advice conversations or during regular reviews of their cover.
As the cost of living rises, many more people may be having second thoughts about their health insurance cover, but with NHS waiting times also increasing it’s a decision they could be wrestling with. Advisers will need to meet the moment in 2023 by ensuring that clients know exactly what benefits private health insurance brings to the table, and why cutting private medical insurance may not be the right choice.
And for those who don’t yet have the benefits of cover, now is the perfect time to have a conversation.
Sources:
1 – The Exeter Challenging Times: The health and financial fears report
2 - www.bma.org.uk
3 - The Exeter – early cancer diagnosis matters
4 – The Exeter, 2022 HealthWise Report