Health insurance premiums will rise by at least a fifth next year, according to industry advisers who blame a surging number and cost of claims.
Individual and workplace cover has soared in demand since the COVID pandemic as the NHS has struggled to deal with patient backlogs.
Almost £3bn was paid out in claims last year alone, according to the Association of British Insurers (ABI) which said that was the highest annual total on record.
The industry body said there were currently a record 4.4 million people covered by health insurance through their employer – likely a result of the waiting lists.
It noted a rise in premiums of around 2% for individual and corporate cover between 2019 and 2022.
But with costs of medical staff and services rising faster than the headline rate of inflation, higher take-up of online doctors and more expensive care, one adviser warned that some workplace schemes were posting rate rises of more than 40%.
Please use Chrome browser for a more accessible video player
Luke James, a senior consultant at Mercer Marsh Benefits, told the Reuters news agency: “Where in the past, PMI (private medical insurance) used to be considered a back-up, it is now becoming the primary point of access into the healthcare system.”
GP phone and online appointments ‘could put patients at risk’
Nurses’ union calls for pay negotiations to be reopened to anger of other health groups after consultants’ pay offer
‘Fake nurse’ entered St Andrews Community Hospital, helped treat patient and left with medical documents
Employers are keen to offer health cover, as delayed treatment can lead to sickness and productivity losses.
Be the first to get Breaking News
Install the Sky News app for free
But they are, the advisers say, starting to question how they can manage the rising insurance costs.
Brett Hill, head of health and protection at consultants Broadstone, warned it could lead to employees paying a flat fee such for initial consultations with a private online doctor, or companies offering health screening to identify medical issues before they get worse.
