Employee health insurance, and the plans beside it

Private medical insurance an employer provides as a workplace benefit.

MoneyHelper says the more basic policies usually cover most in-patient treatments, such as tests and surgery, and day-case surgery, and some extend to out-patient treatment.

The employer pays the premiums; HMRC treats them as a taxable benefit for the employee. MoneyHelper ↗

A general name for the health benefits an employer offers.

The main types are private medical insurance, which pays for treatment; a health cash plan, which MoneyHelper says covers routine medical and dental expenses up to a limit; and welfare counselling, which HMRC says can be exempt from tax. MoneyHelper ↗

No. MoneyHelper says health insurance usually covers conditions that develop after you take out the plan, while a cash plan pays towards routine and ongoing treatments, up to a limit.

Bupa says its corporate cash plans need no pre-authorisation or medical, and pre-existing conditions are covered. MoneyHelper ↗

A health cash plan pays money back on routine costs.

Welfare counselling can be exempt from tax, HMRC says.

One health screening and one medical check-up a year are exempt, and up to £500 a year of recommended treatment to help someone return to work.

Group income protection pays an income rather than treatment. HMRC EIM21845 ↗

Yes, for the employee: HMRC says they are chargeable on the premium paid for them and their family or household, less anything they make good.

The employer reports it on form P11D and pays Class 1A National Insurance on the cost of providing it; GOV.UK gives the Class 1A rate for 2026 to 2027 as 15%. HMRC EIM21762 ↗

MoneyHelper says that if you have a health cash plan as a benefit from your work, you pay tax on the cost of the premiums if you earn over the personal allowance.

A plan you buy yourself carries no extra tax. MoneyHelper ↗

We do not publish prices, and the insurers we checked do not publish business rates: each scheme is quoted.

Whatever the quote, GOV.UK says the value to report is the cost to the employer of providing the insurance, and that is the figure the employee is taxed on. GOV.UK ↗

With some insurers, yes.

Bupa says you can offer cover for employees’ partners or children for an additional cost per person, and AXA Health says family members can be added to its plan at any point.

If the employer pays for family cover, HMRC says the employee is chargeable on that premium too. Bupa ↗

That is your decision, and we do not advise on it.

The tax routes GOV.UK sets out differ: if you arrange and pay the provider directly, you report the benefit on a P11D and pay Class 1A National Insurance; if you reimburse an employee’s medical costs, the payments count as earnings, with PAYE and Class 1 National Insurance through payroll. GOV.UK ↗