Case study: Reducing a 115% increase in Group Medical Insurance costs

The challenge

A company employing 46 people faced a 115% increase in the cost of its Group Private Medical Insurance (GPMI) at renewal. Due to several ongoing high-cost claims, their annual premium was set to increase from £73,151 to £157,581.

Their existing adviser had already approached the market, but the most competitive alternative quotation still exceeded £127,000, representing a 73% increase on the previous year’s premium.

With healthcare benefits playing an important role in attracting and retaining employees, simply reducing cover was not a viable option.

Our approach

Rather than accepting the renewal terms, our Employee Benefits team undertook a detailed review of the scheme and explored alternative ways to manage costs while maintaining a strong employee offering.

This included:

• Reviewing excess structures and cost-sharing options.
• Assessing outpatient benefit levels against employee usage.
• Introducing a complementary Health Cash Plan to offset insurer risk and reduce premium costs.
• Negotiating directly with insurers to secure improved terms.
• Evaluating the wider employee wellbeing proposition, including GP access, Employee Assistance Programmes (EAPs) and preventative health support.

The outcome

By implementing a tailored healthcare strategy, we reduced the annual healthcare cost from the insurer’s renewal premium of £157,581 to just over £101,500.

This delivered:

• A saving of more than £56,000 against the renewal premium.
• A reduction of approximately 36% compared with the renewal terms.
• Continued access to valuable healthcare benefits for employees.
• Enhanced wellbeing support through complementary benefits and services.

Could your organisation achieve similar savings?

Many employers accept large renewal increases because they assume there are few alternatives. In practice, changes to benefit design, insurer negotiations and complementary wellbeing benefits can often reduce costs while maintaining the overall value of the scheme.

If your Group Medical Insurance renewal has increased sharply, we’d be happy to review your current arrangements and identify opportunities to reduce costs while maintaining a competitive employee benefits package. Contact our Employee Benefits team for a complimentary, no-obligation discussion.