Being forced to take time away from running your business, other than for a holiday, can be stressful, especially when the absence relates to dealing with an illness, needing surgery or recovering from a serious accident.
One way to reduce the potential time cost to the business can be to take out private medical insurance, known in the financial services industry as PMI.
The idea is simple. If your GP decides you need a consultant referral and potentially an operation, PMI should mean you don’t have to go on a lengthy NHS waiting list. You are instead referred to the consultant of your (or your GP’s) choice and you should typically receive treatment within days or weeks, rather than having to wait 12-18 months potentially.
This allows you to plan when you will be absent from your business and, more importantly, for how long you will be away, as most comprehensive PMI policies include additional rehabilitation options and, if need be, ‘at home’ treatment.
PMI has some similarities to car insurance in that you can opt for ‘fully comprehensive’ PMI cover right down to a low cost ‘waiting list’ PMI policy, which only comes into play if there a lengthy NHS waiting list for the particular treatment that you need.
The cost of PMI will vary depending on age and in certain cases ‘pre-existing’ medical conditions may be excluded for a period of time. Cover can be extended to include spouses/partners and children.
Group schemes, typically for upwards of 10 individuals are available for businesses and can be offered to selected senior or key employees, acting often as both a staff recruitment and retention tool.
If your business is a limited company, the company can pay PMI premiums for you (or any employee) but they will be treated as a P11D (benefit-in-kind) for personal income tax purposes, meaning that depending on your marginal rate (of income tax) you’ll have to bear between 20% and 45% of the premium costs.
If you are interested in arranging PMI cover (or in re-broking existing cover) while it’s tempting to try to do this online, we’d strongly recommend that you speak instead to an independent, specialist general insurance intermediary. Only an intermediary will know which PMI providers deliver the best customer experience (some of the biggest names in PMI unfortunately are not the best when it comes to service) and what particular type of PMI contract will be most suitable for you and your business.
By Andrew Brown, Partner