10 ways to cut the cost of private health insurance

6 min Read Published: 13 May 2024

10 ways to cut the cost of private health insuranceApproximately 4 million people in the UK currently pay for private health insurance and this number is rising despite the cost of living crisis and the ongoing impact of the Coronavirus pandemic. It goes to prove the importance people place on their health, however, many are finding out that not only is private health insurance relatively complex, but it can also be expensive. While many people are purchasing private health insurance for the first time in their lives, many more are looking for ways to cut down the cost of their policies. You can get an instant quote online* and receive £100 cashback when you start your health cover

The reality is that cutting the cost of your health insurance is going to require some form of compromise. There are, however, some clever ways that you can cut down on the amount you pay each month and so in this article we look at 10 ways you can cut the cost of your health insurance.

1 - Speak to an independent specialist

The best way to cut the cost of your health insurance is to speak to an independent health insurance specialist. An independent specialist will be able to review your existing cover, understand exactly what you are paying for and make recommendations on how to amend your cover to make savings. In addition, an independent health insurance specialist* can compare your existing cover against every other policy on the market to see if there are any other cheaper options out there whilst explaining the compromises that might suit you best.

2 - Check your work benefits

It is worth checking to see if you either already have a health insurance policy through work or if you can sign up for one. Companies do sometimes offer health insurance as an employee benefit meaning you pay a fraction of the cost. If health insurance is provided as a free benefit, it is likely that you'll have to pay the tax on the premiums as health insurance is treated as a benefit in kind, but you'll still save 60%-80% on the premiums depending on the amount of tax you pay.

One thing worth bearing in mind is that if you decide to leave or change jobs, you may lose your benefits and find yourself without health cover. It is best to contact a health insurance broker to discuss a replacement health insurance policy so that you can benefit from continued cover as you may be able to transfer the terms from your employer's health insurance  If you do this your cover will be treated as continuous cover whereas if you contact the provider after leaving employment it will be treated as a new policy and may be more expensive and include some restrictions or exclusions.

3 - Stick to the core benefits

It is worth reviewing your cover to see if you have any additional benefits that you could do without. Most medical insurance policies offer additional optional benefits that can be bolted onto the core cover, such as mental health, cover for therapies and some offer extended cancer cover as an optional extra. While you wouldn't necessarily want to remove benefits from your cover, some options can be expensive and so just removing one option could save you £70-£100 a year.

4 - Limit your hospital choices

Every medical insurance policy is different, however, most will have the option to increase or reduce the private hospitals that you can access. Some policies will charge extra for gaining access to a wider range of hospitals and specialists but it may be that the hospitals that you would want to access are in your area. Policies that include access to some London hospitals can be particularly expensive.

AXA health insurance created a 'guided' option in order to bring down the cost of healthcare by negotiating with a number of medical specialists meaning that customers qualify for reduced premiums if they are happy to be guided to a specialist who is on the list. So, it can be worthwhile checking how a different hospital list could reduce the cost of your health insurance cover.

5 - Downgrade your cover

Some health insurance policies have different levels of cover, for example, some insurance providers offer basic, intermediate and comprehensive cover. You should check and see what type of cover you have and whether you can downgrade your cover.

Basic health insurance will generally only provide cover for treatment, intermediate health insurance cover will pay out for treatment and limited diagnostics and comprehensive cover usually covers you for treatment and full diagnostics (consultancy, tests, scans and x-rays etc).

If you are happy to be diagnosed and referred by your GP to an NHS hospital then basic health insurance cover (sometimes referred to as treatment only) could be enough for you. Switching from comprehensive to basic health insurance can save up to £50 per month in some cases. Check out our article 'How to compare the best private health insurance policies' for more information on the types of health insurance available.

6 - Increase your excess

An excess is an amount you'll have to contribute towards a claim and so it is worth checking the excess on your current policy. Excess amounts will usually range between £0 (the most expensive selection) and £1,000 (the cheapest selection) and so you can bring down the cost of your cover simply by increasing your excess. While increasing your excess will obviously increase the amount you'll have to pay should you ever claim, the savings can be significant and you could always put the amount that you save each month into a savings account and use that as an emergency fund to pay any potential future excess fees.

Increasing your excess from £0 to £1,000 is likely to cut your medical insurance premium in half. Moving from £0 excess to £250 excess is likely to save you between 10%-20% and moving from £250 excess to £500 excess is likely to save you between 10% and 15% on your monthly premiums. However, in some instances you may find that your premium doesn't change much when you increase the excess and this is particularly the case when you move from a £250 excess to a £500 excess so always get a range of quotes so that you can select on the basis of which will provide the best value for money. Check out our article 'Health insurance excess - How does it work?'.

7 - Pay annually

By paying your medical insurance premiums annually instead of monthly, you'll save around 5% a year as the insurance companies offer a small discount as there is less administration involved. If you are paying around £50 a month then you'll save £30 in a year just by making the switch to annual premiums. This is certainly something you should consider when it comes to your annual renewal, something we cover in our next tip.

8 - Shop around when you receive your annual renewal quote

Just like car and home insurance, you should always shop around when it comes to your annual renewal. Firstly, double-check the listed benefits and make a note of them and see if there is anything you can do without. Using our tips above, you may be able to increase your excess, remove some benefits or even pay annually. Once happy, it is then worth comparing your current benefits with other like-for-like policies on the market as you may be able to get the cover cheaper elsewhere.

Here is where it becomes tricky, because comparing health insurance policies can be complex and time-consuming. Many insurers use different language to describe similar benefits and the limitations of your policy may not be immediately apparent.

We would recommend speaking to health insurance experts* - for a limited period, you will receive £100 cashback (Offer ends 31st July 2024) if you take out health insurance this way. You can speak to an expert adviser for free and in just a few minutes they will be able to compare the cover you have and make recommendations on how to save money and if it is worth switching providers.

9 - Stay healthy

Understandably, staying healthy isn't always in your control, but staying healthy can actually save you money on your health insurance premiums. Health insurance providers are coming up with innovative ways to reward their customers for staying healthy with generous cashback offers as well as discounted gym membership and free coffee. To make the most of the rewards on offer you'll be expected to engage with the plan by wearing a fitness tracker and completing various health-related tasks. Check out our Vitality health insurance review for more information.

10 - Save the premiums

Finally, you may want to consider cancelling your health insurance coverage altogether and putting the money that you save each month into a savings account. The money you save each month will build up over time and you could use your savings should you ever need to seek private health treatment in the future. This is perhaps a little drastic and rarely works in practice as most people either forget to put the money aside or find an alternative use for it. Cancelling your health insurance altogether should be a last resort and only be considered once you have tried all of our other tips above.



If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. The following link can be used if you do not wish to help Money to the Masses - Howden Life & Health