Large business in the UK are still valuing the benefits of having private medical insurance for their staff but may be considering cutting down their level of cover to keep employees happy. Recession hit workers are having to pay the P11D tax on their benefits and those on lower incomes are finding this difficult. Rather than cancelling their cover altogether, many companies still want to keep their private health insurance because they recognise the importance of looking after their employees and the return in productivity and efficiency that comes about from doing so. So now it seems that employers might be considering to switching to a policy that has a much lower premium, not just to save themselves money but also the amount of tax their staff are having to pay.


One way they can save money is to change from a traditional level of cover to a cash plan policy which are renowned for providing good benefits but at a much lower cost. Other ways of saving money includes altering the excess amount, and even some more unusual methods. Gareth Ashley-Jones at Aon Consulting told employeebenefits.co.uk, "Clients are asking for more creative solutions, with some structuring PMI with different excess levels. Employees who choose a high excess can reduce the premium and therefore the tax. Many employees do not need the 'full monty' plan. It is a big expense for someone on a low salary. Employers can also reduce costs by using options such as six-week plans, where private treatment is paid for only if the NHS cannot carry it out within six weeks."