The benefits of company health insurance

A quick look at why taking out private medical insurance for your employees will really better your business

Staff illness and injury are an unfortunate, yet inevitable, reality for any employer – one that can be very costly for your business if handled improperly.

On average, 6.3 working days per employee will be lost due to illness every year. So, it’s definitely in every employer’s best interest to minimise the impact absences can have on business as usual. One of the best ways to reduce time off due to sickness or injury is to have company health insurance.

Sometimes known as business medical insurance, company health insurance is essentially the provision of medical cover for your staff, should they need private medical care. This type of insurance is conducive to a healthy, happy workforce because staff are much more likely to return to work quickly following illness or injury having received efficient and effective medical care.

Read on for more information on company health insurance and its business benefits. Or, if you’re looking to improve health and safety within your workplace, scroll to the top of the page to compare health and safety consultancy services.


This page answers the following:


Why should I invest in company health insurance?

According to a recent report carried out by the CIPD (the Chartered Institute of Personnel and Development), over half of UK businesses agree that employee wellbeing is on the senior leadership team’s agenda.

Despite this, one in five employees report that their employer does nothing to improve employee health and wellbeing which, in turn, lowers workplace morale and can have a very negative impact on office culture.

As a vibrant office culture is at the heart of any start-up business, it’s important that you do all you can to maintain a ‘happy-at-work’ atmosphere. Your staff’s health and wellbeing are central to this and investing in company health insurance clearly indicates to current staff, and future employees, that their health and wellbeing is one of your top priorities.

44% of respondents to the CIPD report on health and wellbeing at work agreed that an organisation’s efforts towards employee wellbeing created a healthier and more inclusive culture, whilst 31% noted fewer sickness absences as health and wellbeing became a higher priority.

The stats speak for themselves really, a healthy team makes for a healthy business, and the best way to ensure this is to invest in company health insurance.


How much money can company health insurance save me?

We can wax lyrical about the virtues of company health insurance, but crunching some numbers paints a much clearer picture.

On average, for a small business of ten employees, the number of working days lost to absence per annum is 63 and the total direct cost of this absence amounts to £7,896 per annum. Making the direct cost of absence per person to your business £790 per annum.
Every day an employee calls in sick your direct costs are: £125

But, that’s not quite the whole story. We all know that taking a day off sick has financial implications way beyond the individual’s wages. The real costs incurred average out to £251 every day an employee calls in sick, making your total absence cost per person, per annum: £1,579.

Of course, company health insurance won’t stop people from getting ill – that’s an unfortunate inevitability, but it will make sure that your staff get the proper care, quickly.

Some quick maths reveals that the potential savings available for investment in the health and wellbeing of your employees amounts to £3,158.


Is mental health covered by company health insurance?

Over a fifth of businesses now report mental ill health to be the primary cause of long-term absence. Also reported is a significant increase in the number of organisations that include mental health as one of their top three reasons for staff taking long-term sick leave.

These facts combined indicate that mental health is recognised as a serious health consideration in the working world. Mental health cover does, therefore, come as standard with most company health insurance providers.

But, what does mental health cover actually entail?
The cover provided varies from provider to provider. However, mental health cover as part of a company health insurance scheme will usually involve up to five face-to-face counselling sessions per employee per referral, plus online and telephone support. Different schemes will offer different types of therapy, like cognitive behaviour therapy, whilst others will simply have a helpline.

If mental health cover is something your business is particularly interested in, it’s well worth asking the question to ensure you’re getting the most comprehensive plan for your business.


What is typically covered by company health insurance?

Aside from mental health support, the medical care covered by most company health insurance schemes will vary. Depending on how much you want to spend, you can get very basic to very comprehensive cover. Some of the services provided include:

  • Access to private facilities
  • Outpatient cover, including consultations, diagnostics and x-rays
  • Therapy
  • Prescription delivery
  • Medication
  • Outpatient CT, MRI and PET scans
  • Cancer cover (some providers cover cancer care, others just until cancer is diagnosed)
  • Digital healthcare (online medical consultations)
  • Physiotherapy
  • Hospital treatment including a specialist consultation, dressings and medication
  • Health checks including vitamin D and cholesterol levels
  • Diabetes checks

The above is by no means an exhaustive list of all medical services included in a company health insurance plan. It’s also worth considering which services might be most needed by you employees and selecting your insurance provider accordingly.


What is typically excluded from company health insurance?

Whilst a lot of things are covered, even the most exhaustive of plans will typically exclude certain medical complaints. Typically excluded from company health insurance plans are issues related to:

  • Ageing
  • Menopause
  • Allergies
  • Birth control/contraception
  • Gender reassignment
  • Chronic illnesses
  • Pre-existing conditions (usually backdating five years)
  • Cosmetic surgery
  • Reconstructive surgery
  • Weight loss treatment
  • Pregnancy and childbirth
  • Speech, sight and hearing issues

Again, the above list is a rough approximation as to what is excluded from the average company health insurance plan. It’s advisable to ask your specific provider for full details regarding what is and isn’t included in the package you select.


How much will company health insurance cost?

This figure that will vary from provider to provider and will depend on a number of factors such as the age of your employees, the sector your business is in, and the location of your business.

That being said, we can give you an estimate of how much a company health insurance scheme is likely to cost.

For example, a London-based business in the creative industry, consisting of five employees all between the ages of 25 and 50 – looking for a scheme that offers full outpatient cover, mental health cover and £100 excess – would be faced with the following, approximate costs:

Insurer Average annual cost per employee Total annual premiums
Aviva £805.10 £4,025.52
Axa £887.01 £4,435.07
Bupa £823.97 £4,119.84
Vitality £1,332.94 £6,664.68

In a nutshell

Overall, company health insurance is there to help your business build a robust framework of care around your employees. In taking out a company health insurance plan, you are sending a clear message to your employees that you really value their health and wellbeing.

As well as providing your staff with a real sense of worth, investing in company health insurance is a great way of ensuring that your staff get the healthcare they need, when they need it. This will increase the chances of a swift return to work as the long waiting times and inefficiencies associated with the NHS are avoided.

And, as if healthy, happy staff weren’t reason enough, there are some savings to be made too. Yes, company health insurance requires initial investment, but the long-term savings on sick leave and absences due to illness soon make it an investment that’s really worth your while.

Otherwise, to be put in touch with health and safety providers, or for more information regarding the health and safety measures you can implement to improve the health and wellbeing of your staff, simply fill-in the form at the top of the page to compare health and safety consultancy services.

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