How much does company health insurance cost?

How much does company health insurance cost?

Company health insurance is also known as business health insurance or group health insurance, and it’s started to come towards the top of the wish list for employee benefits.

Very broadly, a traditional company health insurance plan might come in at anywhere between £250 to £1,000 per person per year. While some providers will give you a quick quote online, you might find others want to talk to you first, and that you might need to have quite a lot of detail about your company and what you want out of a product.

The reason is that the cost of a company health insurance plan can depend on a number of different factors. So what kinds of factors? Is it worth it? What’s in it for employers and employees?

What IS company health insurance?

Company health insurance is a plan taken out by an employer to cover its employees for an agreed level of private medical treatment and health/wellbeing services.

Who gets covered?

The business can choose who to offer private health cover to – as long as the decision does not discriminate against individuals or groups of people.

Is it the same as individual private health insurance?

The cover someone gets will be much the same, but will depend on the level of cover or options the employer chooses. The advantage of group health cover over an individual plan is that by spreading risk across an entire ‘group’ of people, the cost of premiums is generally lower than it is for an individual.

What factors can impact the price of a company health plan?

  • Size: Usually, the more people who are going to be covered, the lower the price per employee will be. A group health plan means you get economies of scale.
  • Age: People of different ages have different health risks, and it is generally cheaper to cover younger people. The price of a company health insurance plan might be based on an age range - or on the average age of your workforce. It could also be based on the past claims history of employees.
  • Type of industry: What kind of industry your company operates in could have an impact on the risk of illness or injury – and therefore on the price of your plan. The more likely employees are to make claims, the higher the premium may be.
  • Cover levels: The overall price will obviously depend on the level of cover you choose. The more comprehensive the cover, the more expensive it will be. You may or may not want to include things like dental and optical cover, cancer care, or psychiatric support. All of that will impact how much you pay.
  • Location: It can be more expensive to get treatment depending on where you’re based in the UK. Somewhere like London is a more expensive place to receive treatment than somewhere like Sheffield, for instance.
  • Excess: Employees may be required to pay an excess for their treatment – a certain amount of money before the business health insurance plan kicks in. As an employer you may be able to set that excess amount - and the lower that excess is, the higher your premiums will be as a result.
  • Claims: You may be asked to provide details of the level of your company’s previous claims. The more that’s been claimed, the more expensive the premium may be to start with or next time around, at renewal.

What are the benefits of a company health insurance plan?

Benefits for employees

 Good health care and support can create a positive atmosphere to work in - because people feel valued and cared for. For them, the benefits can include:

  • Peace of mind: People are worried about their health – particularly after Covid. Equipsme’s research has found more than 60% of Brits admit to being worried or very worried about their own or their family’s health.  Many company health plans allow people not only to have health back-up for themselves, but to add on family members, too.
  • Avoiding queues: Some of those rising health concerns are driven by concern over the NHS’s ability to treat people. Our research suggested 69% of people are worried about waiting lists - with many finding it harder to see a GP, or having hospital treatments delayed. But with a company private health cover that includes diagnosis and treatment, people can often jump the NHS queues and get seen by a specialist faster.
  • Convenient support: With access to private healthcare services and insurance, people can often get healthcare support out of hours, or pick their appointment times and locations – making it easier to fit looking after themselves around work and the rest of their lives.

Benefits for employers

Looking after the people that make your business wheels go round means looking after your business itself. The benefits of providing health benefits include:

  • Reduced absences: According the Office for National Statistics (ONS), an estimated 149.3 million working days were lost because of sickness or injury in the UK in 2021 – equivalent to 4.6 days per worker. Minor illnesses accounted for 21.9% of absences, musculoskeletal problems for 13.4%, and mental health conditions for 9.8% of absences. Having easily accessible health support can help reduce both the occurrence and duration of absence – and the cost of a company health plan should be balanced against the cost to the business of people not able to work for it.
  • Improved productivity: There’s growing evidence that a happy, healthy workforce actually does MORE work. Amongst it is recent research from the Association of British Insurers (ABI) – who found that three in five Small to Medium Sized businesses said providing health and wellbeing benefits had a high impact on supporting the productivity of their company.
  • Employee engagement and retention: People are increasingly looking for more from their employers – and starting to vote with their feet. The Great Resignation has followed the pandemic as workers re-think what’s important to them – and health benefits are towards the top of people’s wish lists. It’s becoming key to attracting and retaining top talent. According to Equipsme’s own research, 57% of working Brits would now be prepared to sacrifice salary for private health cover. Meanwhile Mercer Marsh Benefits (MMB) report Boosting employee engagement through benefits choice, found that 59% of those whose companies offered a high level of health benefits were less likely to move elsewhere.

Is there a cost to employees themselves?

Depending on the product you choose for your business, employee members may have to pay an excess towards their treatment before the company health cover takes over. It’s also worth noting that the cost an employer pays for each employee under a company health plan is counted as a benefit in kind. That means that employees will have to pay income tax on it, too.

What they won’t have to do is to pay for all the costs themselves up front and then put in a claim for full or partial reimbursement, as they’d have to do with a cash plan.

How many people do you need to qualify for a company health insurance plan?

You’ll need to be a company with employees, and usually for there to be at least two employees. As well as large group plans for large organisations, there are special types of business health insurance plans that cater for SMEs – and even for self-employed business owners and sole traders.

How is Equipsme different?

Equipsme was set up as an alternative to traditional company health insurance. We provide flexible, practical and affordable plans for businesses of all sizes – from self-employed business owners to SMEs and large corporations.

Unlike traditional providers, the price of Equipsme company health insurance plans is not impacted by location, occupation, or individual ages. We have plans for companies with employees (aged 16-69 when cover starts), for the same price per employee - and plans for self-employed business owners, costing the same price for those aged 16-59 when cover starts. We don’t ask for any medical history and instead apply a simple exclusion of pre-existing medical conditions in the three year before cover starts.

Our different levels of cover are priced very simply and openly, so it’s really easy to see how much a plan might cost you.

Our plans start from just £9 per person per month and our most popular plan which includes diagnosis and treatment is £39 per person per month .

Find out more about what is and isn’t covered under our plans and our prices here.