Why customer service is a vital part of health insurance

Figures from the Association of British Insurers (ABI) show that nearly six million people are covered by private health insurance, with total claims in 2022 coming to almost £3 billion. A separate survey by YouGov, also found that over half (53%) of those turning to private treatment did so in order to be seen more quickly. It comes as little surprise as more than three million people have been waiting for NHS treatment for over 18 weeks. But while private medical insurance (PMI) can help you access care quicker and sometimes offer you a wider choice of treatments, it’s important not to overlook other key areas; in particular, customer service – here’s why.

What is the health insurance claims process?

Claims processes vary by insurer but in most cases you’ll need to speak to your GP first. If they feel your case needs further investigation or that you need particular treatment, they’ll refer you to a specialist. This is usually done in writing with your GP outlining your symptoms, medical history and any test results that are relevant to your condition.

At this point, if you were having NHS treatment, you would be referred to an NHS hospital or specialist. Your case would then be assessed (triaged) and if appropriate, you’ll be asked to make an appointment.

If you have private healthcare, you’ll need to ask your GP to write an ‘open referral’ letter. An open referral simply means it’s not addressed to one specific consultant. Instead, it will refer your case more broadly to any consultant within the field you need treatment in and give you access to your insurer’s list of consultants.

When you have your referral you can then contact your health provider and start your claim. If you’re covered under the terms of your policy, they will authorise the claim and you can find suitable hospitals and consultants to start your treatment.

When you don’t need a GP referral

Some private health insurers offer direct access to certain services, for example, physiotherapy or mental health support. If this is an option included in your package, then you won’t need a GP referral.

How you access these services will be down to your insurer. For instance, you may need to fill in a form, use an app or go through a separate online portal.

How does payment work?

If your policy has an excess, it’s up to you to pay this amount directly to the hospital or clinic (typically this happens before treatment starts or as it starts). The hospital will then invoice your insurer for the remaining amount.

Why is the claims experience so important in health insurance?

Most of us are used to thinking about insurance as nothing more than a useful product that can help minimise our own financial losses, for example, your car or home insurance.

But health insurance isn’t quite the same as claiming for a dented bumper or smashed window – it’s a lot more personal. If you’re experiencing a health problem or need to claim on behalf of a named dependent on your policy, your tolerance for inconveniences is going to be considerably lower.

At its best, a health insurance policy should have clear steps to accessing care, enabling you to have the treatment you need quickly and with minimal administrative complications.

However, in reality, many policyholders suffer poor service, increasing their stress levels at an already difficult time. Most recently, Aviva (the largest health insurance provider in the UK) has come forward to acknowledge poor customer service with some policyholders being put on hold for at least 90 minutes. Reviews also reflect difficulties in accessing suitable hospitals.

Unsurprisingly then, customer service attracts the most comments. But sadly, according to research from accounting firm PricewaterhouseCoopers (PwC), health insurance has one of the lowest customer satisfaction rankings compared to other insurance products (car insurance had the lowest).

While that can be off-putting, PwC research also shows that customer satisfaction results vary the most within the health insurance industry. In other words, despite there being a lot of negative feeling, not all customers experienced this depending on which provider they were with. Out of the brands analysed, AXA came first for customer satisfaction.

How do I choose a private health insurance provider?

While being able to get treatment quickly is a key reason for taking out private health insurance, accessing that care is closely linked to customer service. With that in mind, it’s important to think of the whole package, including the overall efficiency of the claims process. After all, you don’t want to feel like you need to jump through hoops to get the service you’ve paid for.

So, to help you find a policy that suits you, as well as one that minimises the hurdles in getting treatment, here’s what to consider:

Policy features and benefits

Treatments and features are the nuts and bolts of any health insurance policy. In many cases, these will be the elements that you prioritise.

Generally, health insurance covers inpatient treatment (where you stay in hospital either overnight or during the day). Outpatient treatment, including consultations and diagnostic tests, isn’t always included as standard. Nevertheless, you’ll be able to pick and choose the outpatient services you want, which can also help adjust the cost of your policy.

As you’d expect, the more features your policy has, the more you can expect it to cost. However, if you’re trying to balance cost and cover and are willing to sacrifice some outpatient treatment, be clear about what your final policy includes.

Exclusions and limitations

Almost all private health insurance policies exclude pre-existing conditions at the point you apply for cover.

That said, after a certain amount of time (normally two years) cover for those pre-existing conditions is usually reinstated so long as you’ve been symptom-free. It’s a point worth noting, particularly if you’ve got an existing policy but are looking to switch provider.

Some insurers also limit certain treatments by age. For example, Vitality covers some types of corrective surgery, including pinnaplasty (ear reshaping) but patients must be between 5-14 years old. You’ll also be expected to pay 25% of the cost of surgery.

Understanding exclusions might seem fundamental, but one of the criticisms of health insurance is that policyholders become upset when they learn something isn’t covered. According to the Financial Conduct Authority (FCA), it’s a typical complaint they regularly see.

Also consider where you’re covered, as some policies provide insurance while you’re outside of the UK. If this is something you need, be aware that international coverage is not normally included as standard, and you’ll need to pay extra for it.

Policies may also come with a short waiting period. If they do, you may not be able to claim straight away. You can, however, get policies that start immediately.

No claims bonus

Not all health providers offer a no claims bonus, but if they do, you’ll get a discount at renewal but only if you haven’t claimed in the previous policy year.

If you choose a policy which offers a no claims bonus, a claim will typically increase your premium. In some cases, it could increase it by as much as 20% or 30% at renewa. Depending on your insurer, you may have the option of protecting your no claims which can help reduce the risk of an unaffordable price hike.

If you choose a policy without a no claims, your policy price is still likely to increase each year but not necessarily by as much, even if you do make a claim.

Remember though, all policies regardless of whether you have a no claims bonus will be affected by other factors out of your control. This includes your age, general inflation and medical inflation (the rising cost of medical care).  

Understand the claims process

Claims processes vary across providers. Whether you’re expected to fill out a form or use an app, it’s vital to know what steps you need to take.

Most providers will be clear about how to make a claim, if it’s not, then this could be a red flag indicating the type of service you might get. If you can, you should also check review sites to see how current policyholders feel about accessing treatment and overall service.

Bear in mind that there will undoubtedly be both positive and negative reviews so look for trends rather than specific examples (no matter how disgruntled the reviewer).

Additional benefits

Research shows that no matter the type of insurance, consumers want more than just the basics. As well as cover, a growing number of policyholders want insurance firms to help them lower the risk of making a claim in the first place. For health insurance, this could mean encouraging healthy living.

Some insurance firms already do this so if you’re looking for more than just essential cover, consider policies that include gym discounts and healthy lifestyle incentives. While they might seem like ‘nice to haves’ actually using the services on offer could genuinely help you maintain good health, lowering the risk of a claim altogether.

Which is the best health insurance provider?

Taking out private health insurance is a personal choice and the policy and provider that’s right for you will very much depend on your circumstances. Nevertheless, ensuring that you look at all aspects of the policy as well as reviews can help increase your chances of finding a policy that suits you, and that you feel provides value.

How can I help ensure a hassle-free claims process?

Making a claim shouldn’t be difficult but you can minimise issues by:

Understanding your policy and its limitations – know what is and isn’t covered.Following the claims procedure – this may be different according to the specific claim (for example, if you need a GP referral or if you can refer yourself).Ensuring you have authorisation – your insurer must authorise treatment before it starts so always wait for confirmation.Providing the correct information – check the details you provide are correct and that you’ve included everything you’ve been asked for (incorrect information is one of the main reasons why claims are rejected).Making sure you’ve disclosed all your medical conditions – not telling your insurer everything they need to know is considered non-disclosure and it could void your policy. This means your insurer can refuse to cover your treatment costs.

How to complain about your health insurance provider

If you have a complaint, the first step is to contact your health insurance provider. They should have a clear complaints policy on their website or within your policy documents.

If you’re not happy with the way your complaint has been handled or your insurer fails to respond, you can escalate your complaint to the Financial Ombudsman Service.

The ombudsman service is free and impartial so you can be confident that your complaint will be looked at objectively. You and your insurer will be asked for the facts of the case, and it will be investigated.

Based on the information, the ombudsman will try to find a resolution. You don’t have to agree with the decision. If that’s the case, it can be further escalated within the ombudsman service and a ‘final decision’ will be reached.

Again, you don’t have to accept the solution but at this point, the financial ombudsman won’t be able to help you any further. If you want to pursue your complaint, you can take your insurer to court.  

Weighing up the pros and cons of private health insurance

When it comes to private health insurance, there’s a lot to consider – not least the cost. But having a policy in place can help you avoid lengthy waiting lists and in some cases, give you access to additional services including mental health support.

To help you weigh up the benefits and disadvantages, we’ve put together a host of health insurance guides – from comparing the average cost of health insurance to understanding the difference between comprehensive and basic plans.

Disclaimer: This information is general and what is best for you will depend on your personal circumstances. Please speak with a financial adviser or do your own research before making a decision.