Private health insurance (often called private medical insurance, or PMI) is a policy people buy to access healthcare outside the NHS, including elective surgery, diagnostics, specialist consultations, and sometimes treatments more quickly than through public services. It generally covers acute conditions (those that respond rapidly to treatment), diagnostics, outpatient and inpatient care. It does not always cover chronic, mental health, dental or optical care unless these are explicitly included.
How has usage changed recently?
According to the Private Healthcare Information Network, private hospital and clinic admissions in the UK in the first quarter of 2025 reached about 240,730 — the second highest quarterly total on record, even though it represents a slight 1% drop from the same period in 2024.
Admissions funded via private health insurance rose slightly (around 0.3%), while self-pay admissions fell by about 4%.
In Scotland, the number of admissions in Q1 2025 rose by 5% compared to Q1 2024, reaching over 13,000 — a record quarterly high. Insured admissions there rose nearly 10%, while self-paid admissions declined slightly.
Who is taking out private health insurance, and how many?
As of 2024, about 14% of UK adults (around 7.6 million people) hold private medical insurance, up from 6.7 million in 2020.
Employer schemes remain a major route: the number of people covered by private medical insurance via their employer has reached record levels — around 4.7 million people. Overall demand for health and dental cover is increasing.
What’s driving growth?
- NHS waiting times: Longer waits in the public system are motivating many to look towards private insurance for faster access to treatment.
- Employer benefits: Employers are increasingly offering health cover as part of benefits packages, making private health insurance more accessible.
- Perceived value: Many believe private care gives more comfort, shorter waits, and choice of providers. Even entry-level policies can be relatively affordable for younger, healthier people.
What about cost and affordability?
Premiums vary a lot depending on age, location, health history, and what exactly is included (e.g. diagnostics, outpatient cover, specialist care, excesses, etc.). Younger, healthier people in less expensive regions tend to pay much less. For example, some basic elective cover for a 30-year-old may cost under £40–£60/month. More comprehensive policies cost significantly more.
Insurers warn that premiums increase with age, with additional risk, older age groups, or pre-existing conditions contributing to higher cost. Also there are regional differences.
Trends in insurance-funded vs self-pay treatments
Insurance-funded admissions are now making up a greater share of private healthcare activity. In 2024, private medical insurance funded admissions rose about 6%. Meanwhile, self-pay admissions slipped slightly, though remain historically high.
In many regions, self-pay admissions are falling, suggesting that more people are opting for insurance rather than paying out of pocket.
Is private health insurance right for you?
It depends on your priorities, budget, and health situation. If you value fast access, better accommodation or greater choice, and can afford the premiums, private health insurance could make sense. If your healthcare needs are minimal, or if you are comfortable using NHS for much of your care, then the cost might not justify the benefit.
When comparing policies, look closely at what is included (outpatient vs inpatient, diagnostics, excesses, specialists, etc.), the insurer’s reputation for claim handling, waiting periods, and whether you can get good value via employer schemes.
What’s next?
The private health insurance market is expected to keep growing in 2025, driven by NHS backlogs, rising demand, and broader uptake. But challenges remain: keeping premiums affordable, especially for older people or those with pre-existing conditions; ensuring transparency of what’s covered; and balancing insurer capacity (e.g. consultants, hospital space) with demand.
Recent news highlights
• Private medical insurance-funded hospital admissions in Q1 2025 hit a record level, even as overall admissions saw a slight decline.
• The UK health cover market (medical plus dental) surged to ~£7.59 billion in value, with private medical cover alone accounting for about £6.15 billion.
Conclusion
The rising importance of private health insurance in the UK reflects a shifting healthcare environment. With NHS pressures, increased consumer expectations, growing employer benefits, and changing demographics, private cover is no longer a fringe choice for many. But it’s essential to understand the costs, what’s covered, and whether the benefits align with your needs.
For anyone considering private health insurance, comparing quotes, reading policy fine print, and seeking advice are critical steps.
YOU MAY ALSO LIKE
