Question 1

How many employees do I need to qualify for group PMI?

Accepted Answer

Most UK insurers accept schemes from 2 employees — Bupa, AXA, Aviva and WPA all write from 2 lives. Vitality Business requires 3. Below 2 employees you'd use individual PMI, not a group scheme, though HMRC BIK treatment is similar.

Question 2

Is small-business health insurance tax deductible?

Accepted Answer

Yes. Under HMRC BIM45560 the premium is a fully deductible business expense against corporation tax. The employee pays income tax on the P11D benefit-in-kind value (HMRC EIM21765), and the employer pays Class 1A National Insurance on that BIK at the current rate. Net cost after tax relief is typically 20–25% lower than headline.

Question 3

Do I have to include every employee?

Accepted Answer

No — but if you exclude certain employees, HMRC and equality-law considerations apply. Most SME schemes are 'all-employee' for tax and simplicity, but 'director-only' and 'defined tier' schemes are common and legitimate. We help you draft eligibility rules that stand up to a P11D audit.

Question 4

What's the difference between community-rated and experience-rated pricing?

Accepted Answer

Community-rated (typical up to ~50 lives) prices the scheme against the insurer's whole SME book — one bad claim doesn't spike your premium. Experience-rated (typical 50+ lives) prices against your own claims history — good if your workforce is healthy, painful after a big claim year. Transition thresholds vary by insurer.

Question 5

Can employees include their spouse and children?

Accepted Answer

Yes, on virtually every UK group scheme. Family cover is usually optional and paid for by either the employer or the employee (via salary sacrifice or net-pay contribution). Adding a partner typically costs 80–110% of the employee premium; each child 20–35%.

Question 6

What happens if an employee leaves?

Accepted Answer

They leave the group scheme and can usually take a 'continuation policy' with the same insurer on individual terms, with underwriting preserved (no new medical questions). This is a valuable perk we always highlight in leaver packs — most employees don't know it exists.

Question 7

How long does it take to set up a group scheme?

Accepted Answer

Typically 3–10 working days from us receiving your employee census. We benchmark leading UK PMI insurers, arrange underwriting, issue schedules and set up direct debit. For an active company with in-force cover we can arrange typically same-working-day quotes.

Question 8

Do we need to run a competitive tender each year?

Accepted Answer

You should benchmark at every renewal, but you don't have to formally re-tender. We run a full seven-insurer benchmark 60 days before renewal — CPME switching means you can move insurer without losing underwriting for existing conditions, so switching is far less painful than it sounds.

Question 9

Is mental health cover included?

Accepted Answer

All seven UK group PMI providers now include some level of mental health cover — but limits vary from £1,500 to unlimited per employee per year. Bupa, AXA and Aviva have the most comprehensive employee mental health offerings, often including EAP telephone counselling on top of clinical cover.

Question 10

What's the cheapest way to offer PMI to a small team?

Accepted Answer

For 2–5 employees, Aviva Optimum core with £250 excess and moratorium underwriting typically comes in cheapest — around £30–£40 per employee per month for a young workforce. Vitality Business can be even cheaper if the team actually uses the wellness engagement (verified via Apple Watch or Garmin).

Small Business Health Insurance UK

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