Health insurance excess – How does it work?

3 min Read Published: 25 Oct 2023

How does health insurance excess workWhen you buy a health insurance policy (often referred to as private health insurance or private medical insurance) you can choose how much excess you are willing to pay in the event of a claim. Excess is essentially the initial part of the claim that you are willing to pay yourself; so if you had treatment totalling £500 and the excess was £100, you would be expected to pay £100 towards the total cost.

How does health insurance excess work?

There are three types of health insurance excess, explained below:

Excess that annually resets on policy renewal date

This is the most common form of health insurance excess renewal. If you took out the policy on 1st January, the excess would renew on 1st January each year. If you made a successful claim in December and then again in February, you would have to pay the excess twice

Excess that resets a year after policy was first paid

For some policies, the health insurance excess will renew a year after it was first paid and so if your policy is due to renew on 1st January, but you claimed in December, the excess renewal would not happen until the following December.

No excess

You can choose to take a policy with zero excess on health insurance, however, you need to be prepared to pay a much higher premium each month if you do.

How does health insurance excess impact monthly premiums?

Below you can see how the excess on health insurance impacts the monthly premium that you pay. We have provided examples for basic, intermediate and comprehensive cover. For more information on the different types of health insurance, you can buy, check out our article 'What type of health insurance should I buy?'

Cost of health insurance based on the excess you choose

£0 Excess £100 Excess £250 Excess £500 Excess £1,000 Excess
Basic £26.22 £24.29 £21.38 £17.75 £15.34
Intermediate £30.16 £28.22 £25.32 £21.69 £19.28
Comprehensive £44.99 £43.05 £40.15 £36.52 £34.10

*premiums based on a person aged 30 is a non-smoker

How is health insurance excess paid?

If you require medical treatment and decide to seek private treatment, then you will need to contact your health insurance provider in order to get an authorisation number. Make sure you take this with you to your private consultation.

Upon receiving your private treatment, you will be provided with a medical bill which will usually be conveniently split into sections. It should be clearly stated what is and what is not covered by your health insurance policy.

If the cost of your care is less than your health insurance excess, then you will be asked to pay the bill in full. Always keep your insurer informed because if you require continued treatment (within the policy year) the insurer will take on payments once they exceed the excess.

Paying health insurance excess

The portion of the bill that is covered by your health insurance policy will be sent to your insurer and they will pay it. After the insurer has paid their part, your insurer will ask you to contact the healthcare provider to settle the final part of the bill, which will include the excess plus anything not covered on your policy.

How to purchase the right health insurance policy (with the best excess option)

Most people have heard of health insurance providers such as Bupa, Axa and Vitality, but there are other lesser-known companies that provide excellent private health insurance and so you should always do a comprehensive comparison before you make a commitment to one insurer.

We have found that the best way to buy health insurance is to speak to a specialist health insurance adviser* who has access to all insurers and a range of policies. Not only will they be able to find you the best policy for your own unique circumstances, but they can also work to your specific budget and come up with a selection of options by tweaking the excess and cover type so that you can find the most comprehensive cover to fit your budget.

We have partnered with one of the UK's leading private health insurance comparison specialists* in order to provide you with the best and cheapest policies available. You can build your own quotation online via this link or arrange a callback from an adviser at a time that suits you. You will receive £100 cashback when you buy your health insurance policy this way - the offer ends on 31st July 2024.



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