In This Guide

At A Glance

Why Do Health Insurance Excesses Exist?

Excesses give customers a way to adjust the balance between monthly cost and potential claim cost.

From an insurer’s point of view, an excess can reduce smaller claims and lower the amount the insurer may need to pay. From a customer’s point of view, it can create flexibility and sometimes reduce the monthly premium.

The important point is that an excess should not be viewed in isolation. It needs to be compared against the premium saving, the level of cover, the hospital list and how the excess applies.

CMHI Expert Insight: A Higher Excess Is Not Always More Risky

How Does Excess Affect The Price?

In many cases, increasing your excess can reduce the monthly premium. The insurer may charge less because you are agreeing to pay more towards a claim.

When A Higher Excess May Be Worth Considering

The Detail That Really Matters: How The Excess Applies

This is where people can easily get caught out.

A £250 excess that applies once per policy year is very different from a £250 excess that could apply to each separate claim or condition.

This detail can change whether a higher excess is a sensible cost-saving option or whether it creates more potential cost than expected.

Common Misunderstandings About Health Insurance Excess

“A Higher Excess Always Means More Risk”

Not always. If the annual saving is larger than the excess and the excess applies once per year, the numbers may still work in the customer’s favour.

“The Cheapest Monthly Premium Is Always Best”

A lower premium can look attractive, but it needs to be compared against the excess, hospital list, out-patient cover, cancer cover and underwriting terms.

“All Insurers Apply Excess In The Same Way”

They do not. This is why the policy wording matters.

“Reducing Benefits Is The Only Way To Save Money”

Sometimes changing the excess may reduce cost while keeping stronger benefits in place. This depends on the insurer and policy.

Questions To Ask Before Choosing An Excess

• How much does each excess option reduce the monthly premium?
• Does the saving outweigh the extra excess risk?
• Is the excess applied annually, per claim or per condition?
• Could the excess apply more than once in a year?
• Would the excess still feel affordable if treatment was needed?
• Are any important benefits being removed just to reduce the premium?
• Does the policy still include the hospitals, benefits and cover levels that matter?

How CMHI Helps Make This Simpler

CMHI helps people compare private health insurance options from leading UK insurers. We make the process clearer by helping you understand the parts of a policy that affect value, not just the headline monthly price.

That includes excess options, hospital access, out-patient limits, cancer cover, underwriting and renewal considerations.

We do not believe private health insurance should feel confusing. The aim is to help you compare your options with more confidence and access specialist broker support where appropriate.

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