The Labour Budget on 30 October is likely to be one of the most significant fiscal announcements for some time. Among touted tax increases and reforms to pensions, the NHS and the way it’s funded could also be a feature.

Indeed, prime minister Keir Starmer has already hinted at this, describing the health service as in a “critical condition” and promising a 10-year plan to reform it, the BBC reports.

With all this in mind, you might be thinking about the relative pros and cons of private medical insurance (PMI).

You could especially have PMI on your mind if you’re approaching, at, or in retirement, and wondering whether you need this cover for the period in your life when you’re arguably most likely to need it.

You may well have paid for PMI yourself throughout your career. Or, you might have received it as part of a benefits package from your employer.

Either way, once you reach retirement, you may be wondering whether it’s worth paying for the cost of it – especially with the prime minister’s warning in mind, and Cover magazine reporting that NHS waiting lists exceeded 7.6 million patients.

So, read on to discover the pros and cons of PMI, especially in later life when you’re no longer working.

NHS waiting times may be a cause for concern

To begin with, it’s worth thinking carefully about the NHS waiting list and what this actually means.

The figures published by Cover show that the NHS waiting list reached 7.6 million in May 2024, made up of 6.4 million individual patients. Of these, 307,500 of them had been waiting for at least 52 weeks. This is just shy of the waiting list’s peak of 7.7 million, recorded in September 2023.

Not only that but, as IFA Magazine reports, 14.2 million adults say the wait for a GP appointment is too long.

It might come as little surprise, then, that interest in PMI has increased significantly, rising 83% over the last three years, Cover reported in July.

You could understandably be among this figure if you’re worried about what longer waits could mean for your health. Having to wait longer for a GP appointment could potentially be problematic if it means a later diagnosis for a condition that be detrimental to your health in the long term.

Similarly, you may feel nervous about the prospect of not being able to immediately access surgery or other treatment for a serious disorder or disease.

Even if you’re only concerned about non-critical, elective treatment, waiting 52 weeks or more might be frustrating. It could be restrictive to your retirement lifestyle if you face delays in accessing surgery that could improve your day-to-day life, such as hip or knee replacements.

As a result, it could be sensible to explore PMI options.

Private medical cover is expensive, and the costs will likely rise as you get older

Of course, perhaps the biggest barrier to PMI is the cost, especially in retirement when your income will typically fall.

According to iamINSURED, the average cost of PMI in 2024 is £41.58 a month for single adults, rising to £77.42 for couples.

However, this data is not separated for age, and when you look at the figures by age bracket, they’re slightly less forgiving. The table below shows figures collated by Forbes Advisor, showing how the cost rises as you get older, especially if you want comprehensive cover:

Source: Forbes Advisor. Based on typical non-smoker premiums, not living in London, 2024.

These costs don’t take into account any pre-existing conditions you may have, which could drive the price even higher, particularly as you get older.

These costs are high, and could be a particularly steep increase if you move from employer-funded insurance to covering the bill yourself. Naturally, there’s always a possibility that you’ll never even need the cover, too.

It’s worth noting that many employer healthcare schemes have a “group leaver’s policy”, allowing you to remain with your existing policy provider from throughout your career. This can be preferential as you can usually maintain your level of cover, with pre-existing medical conditions included.

That said, this cover can be more expensive than you need. So, it can be sensible to shop around and see what’s available. Even if you choose to stick to your existing cover, you’ll have the peace of mind that you’re paying an appropriate amount that you’re happy with.

You could always self-insure rather than pay for cover

One alternative to both relying on NHS care and paying for PMI is to self-insure in retirement instead.

This involves setting aside funds in a separate savings pot, earmarked specifically for the purpose of paying for private healthcare should you need it.

That way, you know you have the means to pay for private healthcare if you want it, but without paying an insurer’s premiums.

If you intend to do this, it’s worth thinking about the type of care you might require and how much it costs. For example, data from MoneyHelper shows that hip and knee replacements usually cost around £10,000, and MRI scans are usually around £500. It may be worth aiming to build a pot that could cover costs like these if they’re the aspects you’re most concerned about.

Additionally, you can always pay to speak to a private consultant for your options and then arrange to have your treatment through the NHS if you’re comfortable doing so. That way, you can access care quickly for a fee, before then accessing treatment through the health service.

Get in touch

If you’d like to find out more about making the most of your wealth so you can achieve your life goals, please do get in touch with us at Cordiner Wealth.

Email hello@cordinerwealth.co.uk or call 0113 262 1242 to speak to us today.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.