Can I Get a Private Medical Insurance No Claims Discount?

Do no claims discounts exist in private medical insurance? Given that they are in both car insurance, it seems feasible that they should be in health insurance, too.

This guide answers questions relating to no claims discounts in private medical insurance.

What is a No Claims Discount?

You may have heard the term ‘no claims discount’ heard on other policies such as for car insurance. However, you may not understand what that term means, let alone if it applies to health insurance.

The definition of a no claims discount is that you will pay less on your premiums if you don’t claim on your policy. We note that not every insurer offers a discount system, nor do they all apply in the same way.

So, do no claims discounts apply to private medical insurance?

Do No Claims Discounts Apply to Private Medical Insurance?

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It’s not widely known, but many insurers will offer no claims discounts for health insurance. These bonuses implement a system where your monthly premiums for your private medical insurance will reduce if you don’t
raise a claim to cover your medical costs.

However, the no claims system should not deter you from seeking medical attention only to get a discount. Your health is of the utmost importance, and taking care of yourself is more significant than not making a claim.

How Do a No Claims Discounts Work With Insurers?

Insurers implement a scaling system to determine the cost of your premiums based on how many claims you make per year. 
The gist of how no claims discounts works is that the less you claim, the higher you move up the insurers ranking scale.

Each number on that scale has a level of discount applied. The scale varies by insurer, but most will use a ‘0-10’ range, where ‘0’ is no discount, and ’10’ would be the maximum discount.

Examples of these are below:

• Someone taking out a new private medical insurance policy will be on the ‘0’ scale, meaning no discount.

• A policyholder who hasn’t processed a claim in 20 years will get the maximum discount applied on their premiums, being on the ’10’ scale.

The system is complex, and it’s understandably challenging to conceive with policyholders. The brunt of the process is that making claims will drop you down the scale, and not doing so will allow you to rise.

It would make policyholders slightly uncomfortable to claim if they’ve managed to achieve the maximum discount available on the scale. Is it possible to protect your no claims discount?

Can You Protect Your No Claims Discount?

Insurers are aware of the dilemma this causes a policyholder. There are measures to protect your no claims discount should you make a claim. These come in the form of an additional protection option you can place to secure your
reduction.

If you make a claim where you’ve accrued a significant no claims discount, your current discount will stay the same for the next policy year. However, your discount won’t increase.

The advantages and disadvantages of no claims discounts in health insurance are complex. That notion is partly because the frozen discount doesn’t necessarily mean your premiums won’t rise.

Ultimately, are no claims discount systems suitable for health insurance?

Are No Claims Discounts Good in Health Insurance?

Determining whether no claims discounts are beneficial in health insurance requires a breakdown of the advantages and disadvantages of the system. We examine them below:

Advantages

• Protective measures for discounts – Many insurers understand that you might want to protect any no claims discounts you accrued. Protection is available for a relatively inexpensive cost.

• Save money if you are healthy – You can save significantly on premiums by simply keeping fit.

• Can make private health insurance more affordable – Prospective policyholders weigh whether to get health insurance because it can be another high monthly cost. Rising up the insurer’s no claims discount
  scale can make private health plans much more affordable.

Disadvantages

• Pressure not to make a claim – The problem with the no claims discount system is that it may deter policyholders needing medical attention away from making a claim.

• Punishes the unwell – There are arguments that the no claims system doles punishment on the unhealthy. People take out private health insurance to cover acute conditions but would seemingly get penalized
  for making claims.

• Discriminates against older people – As we get older in age, we’ll need more healthcare. That’s a matter of fact. A no claims discount system would discriminate against the old as it pushes up their
  premiums.

You may want to consider other personal reasons for a health insurance plan with a no claims discount. Be sure to speak to your prospective or existing insurer to learn more about how their no claims discount system works and whether
it’s right for you.

So, with the advantages and disadvantages considered, what kind of costs would we look at for no claims discounts?

How Much Do No Claims Discounts Affect My Health Insurance Premiums?

It’s challenging to work out the costs of premiums with no claims discount systems in place, purely because every insurer has different discount methods. The designs are often complex and challenging from a client’s perspective.

Premiums could rise against the renewal of your policy with a no claims discount still applying. That leaves the cost per month still going up despite you not claiming the previous year.

We highly recommend speaking with your insurer about premiums and no claims discounts.

A Summary of No Claims Discounts in Private Medical Insurance

Let’s summarize getting a no claims discount in private medical insurance.

• A no claims discount implies that you’ll pay less on your premiums if you don’t make a claim

• More insurers implement no claims discount systems into private medical insurance policies

• Most insurers will work with a scaling system that gives you more discount the longer you don’t make a claim

• There are advantages and disadvantages to the no claims system

• The way no claims discounts affect your premiums differ by insurer

Remember to speak to your private health insurance provider or broker about no claims discounts before you take out a private health insurance policy or renew an existing one.