Small business health insurance
A guide for start-ups and small business owners looking to boost employee wellbeing and stay competitive.
What is small business health insurance?
Small business health insurance is a type of group insurance plan that covers the healthcare needs of your employees.
The way it works is simple. You, the employer, pay a monthly premium for your team's coverage. In return, your employees get access to medical care, including doctor visits, hospital stays, prescription medications, and other health services.
Depending on the plan you choose, the insurance might cover all the costs, or it might include some out-of-pocket costs for your staff. You may also be able to deduct the cost of your premiums as a business expense on your taxes.
Tip: Health insurance can be an attractive benefit that helps you recruit and retain the most talented workers.
Types of small business health insurance plans
Workplace health insurance includes a wide range of options - here's a breakdown of the main types of plan:
Private medical insurance (PMI)
PMI gives employees quicker access to private healthcare, such as consultations, treatments, and hospital stays. It offers faster specialist access, shorter waiting times, and a broader selection of doctors and hospitals. Comprehensive PMI can also cover inpatient, outpatient, cancer care, and mental health support.
Health cash plans
Health cash plans offer employees cashback for everyday healthcare expenses like dental check-ups, physiotherapy, and eye tests. They're an affordable way to help employees manage their healthcare costs and encourage them to take charge of their health and wellbeing.
Dental insurance
Dental insurance helps cover the cost of dental treatments, such as routine check-ups, fillings, and crowns. It makes dental care more accessible and can reduce the financial pressure when your staff need treatment. Many insurers offer dental insurance as part of their corporate health plans.
Critical illness cover
Critical illness cover offers a lump sum if an employee has a serious illness like cancer, or suffers a stroke or heart attack. It's designed to lessen the financial burden of treatments, rehab, or other unexpected costs during recovery. It's often offered as part of a broader benefits package.
Income protection
Income protection is for staff who are temporarily unable to work due to illness or injury. It replaces a percentage of their income for a period, so they can meet their day-to-day expenses and bills while they recover. Income protection offers peace of mind should circumstances suddenly change.
Key factors to consider
Before deciding on health insurance for your team, consider the following to make sure the coverage benefits everyone:
Cost and budget
While health insurance benefits can be a great perk for your team, the costs vary. Premiums vary depending on the number of people, the level of coverage, and whether you offer cover for family members. Review your firm's finances and decide how much you can afford. In some cases, you might share the cost of cover with staff, so balancing this with their expectations is key.
Employee health needs
Every employee has unique healthcare needs. Some might need mental health cover, while others may have specific treatment needs. It's important to consider their health and wellbeing needs and gather feedback to find out what kind of healthcare cover they'd most appreciate. This will help ensure the plan covers the most essential services and any important extras.
Private medical insurance options
When considering employee health insurance, you'll find that private medical insurance is a popular option. It offers faster access to treatments, specialist care, and private hospital access. Assess whether the policy includes coverage for pre-existing conditions, how it handles ongoing care, and whether it includes any group income protection.
Coverage for family members
Some businesses offer private health cover that extends to employees' family. This means extra value to your workforce, especially for staff with children or dependents who'd benefit from quality healthcare. Offering family member coverage can help boost employee retention and morale, too.
Choosing the right professionals
It's important to make sure your health insurance policies include access to a wide range of healthcare professionals. Be sure to choose a plan that offers a strong network of doctors, specialists, and mental health professionals, giving your staff access to the care they need, when they need it.
Conditions and waiting periods
Many policies have restrictions when it comes to pre-existing conditions, meaning certain health issues may not be covered, or could be subject to a waiting period. Consider how this will impact your staff, especially those who may need ongoing treatment. Review policies carefully and discuss them with your insurer to find a plan that offers the right coverage.
Summing up
Small business health insurance is an essential tool for taking care of your team while also benefiting your business. It's an investment that can help you attract top talent, boost employee morale, and reduce absences.
With several different plan types available, you'll need to consider your business's needs, budget, and your employees' preferences to choose the right option. Health insurance might seem like a big commitment, but the rewards are worth it in the long run.
Frequently Asked Questions
Do I have to offer health insurance to my employees?
Unlike in some countries, such as the US, where employers are mandated to provide health insurance under certain conditions, there are no such obligations in the UK for small businesses. Still, providing health insurance can be a powerful tool to boost team morale and attract new talent.
Do I have to offer health insurance to my employees?
Unlike in some countries, such as the US, where employers are mandated to provide health insurance under certain conditions, there are no such obligations in the UK for small businesses. Still, providing health insurance can be a powerful tool to boost team morale and attract new talent.
Do I have to offer health insurance to my employees?
Unlike in some countries, such as the US, where employers are mandated to provide health insurance under certain conditions, there are no such obligations in the UK for small businesses. Still, providing health insurance can be a powerful tool to boost team morale and attract new talent.
Do I have to offer health insurance to my employees?
Unlike in some countries, such as the US, where employers are mandated to provide health insurance under certain conditions, there are no such obligations in the UK for small businesses. Still, providing health insurance can be a powerful tool to boost team morale and attract new talent.
How much does small business health insurance cost?
The cost of small business health insurance can vary widely based on several factors. The number of employees you have, the type of plan you choose, and the level of coverage all play a role in the price. The more employees you have, the more likely you are to get discounts for bulk coverage.
How much does small business health insurance cost?
The cost of small business health insurance can vary widely based on several factors. The number of employees you have, the type of plan you choose, and the level of coverage all play a role in the price. The more employees you have, the more likely you are to get discounts for bulk coverage.
How much does small business health insurance cost?
The cost of small business health insurance can vary widely based on several factors. The number of employees you have, the type of plan you choose, and the level of coverage all play a role in the price. The more employees you have, the more likely you are to get discounts for bulk coverage.
How much does small business health insurance cost?
The cost of small business health insurance can vary widely based on several factors. The number of employees you have, the type of plan you choose, and the level of coverage all play a role in the price. The more employees you have, the more likely you are to get discounts for bulk coverage.
Can I choose who gets health insurance at my business?
Yes, as the business owner, you can decide which employees are eligible for health insurance. Many small businesses choose to offer cover to all full-time employees. You may choose to extend coverage to part-time workers or just key staff members, depending on your company's budget and needs.
Can I choose who gets health insurance at my business?
Yes, as the business owner, you can decide which employees are eligible for health insurance. Many small businesses choose to offer cover to all full-time employees. You may choose to extend coverage to part-time workers or just key staff members, depending on your company's budget and needs.
Can I choose who gets health insurance at my business?
Yes, as the business owner, you can decide which employees are eligible for health insurance. Many small businesses choose to offer cover to all full-time employees. You may choose to extend coverage to part-time workers or just key staff members, depending on your company's budget and needs.
Can I choose who gets health insurance at my business?
Yes, as the business owner, you can decide which employees are eligible for health insurance. Many small businesses choose to offer cover to all full-time employees. You may choose to extend coverage to part-time workers or just key staff members, depending on your company's budget and needs.
About the author
Lawrence Howlett
Lawrence Howlett brings a results-driven mindset to his writing, shaped by over a decade of experience across finance, legal, and energy sectors. As the founder of Moneysavingadvisors, he’s built a reputation for turning complex financial concepts into clear, actionable insights for consumers. His writing stands out for its clarity, structure, and focus on delivering value.
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