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SME vs Corporate Health Insurance

In the UK, the key difference between SME and corporate health insurance is mainly related to the size of the business, coverage options and costs. Let’s explore in more detail below:

SME Health Insurance:

Specialises in group sizes between 1-250 employees. Although a typical SME plan would be for up to 100 lives.

Offers flexible plans that can be tailored to meet the specific needs and requirements of a smaller company. Budgets can be controlled more by the selections made around the policy benefits.

Allows tiered options, where multi categories can host different levels of cover for the hierarchy, or simply so you can control the budget for different entry requirements.

Generally, more affordable than a corporate health plan due to the size difference.

Premiums are calculated based on the size of the group, the age of the employees, the level of cover selected, and the postal code of the business.

Typical bolt on benefits such as Dental & Optical, Employee Assistance Programmes, Hospital upgrades, and in some cases bolt on Travel Insurance.

Flexibility of benefits when choosing to implement a plan, and at each renewal you can revisit this to ensure it continues to meet the budget requirements.

Administration tends to be easier, simply due to the size difference, which is of course less time consuming.

Often includes online management tools for adding, removing employees and access to the policy documents.

Corporate Health Insurance:

Designed for corporate entities over 250 employee schemes but can also cater for companies with thousands of employees.

Typically you would find that a large corporate scheme would offer more enhanced benefits to cater for a more diverse workforce.

Broader range of benefits could include things like health screenings, mental health programmes, some maternity cover, International coverage and can also be bespoke to demographic areas for the employees.

Corporate health cover is going to come with a bigger premium compared to an SME plan due to the size difference.

An corporate health plan tends to be experience rated in comparison to an SME plan which would typically be age rated.

Typical bolt on benefits such as Dental & Optical, Employee Assistance Programmes, Hospital upgrades, and in some cases bolt on Travel Insurance.

Employees would tend to see a blanket cost across the whole group as age is not a rating factor. This can have its advantages for the older generation of employees, especially considering the the contribution employees have to make as a benefit in kind (taxed).

A more complex administration would be required for a corporate health plan, which may require a dedicated HR or benefits personnel to help manage the scheme with your broker.

The plan would usually involve more extensive claims management and reporting, sometimes with individual account managers with the insurer.

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Sumary

SME: Suited for smaller businesses, offering flexible, cost effective plans with basic to comprehensive cover options tailored to your requirements. The cost is based on yhe age of employees, benefits selected and on the business location in the UK. The loss-ratio of the scheme, annual increases in age and medical inflation will factor in to future renewal pricing.

Corporate: Suited for larger enterprises and tending to offer an enhanced range of benefits. Typically carrying a higher premium overall because of the head count. The plan would be experience rated, meaning a blanket cost for each employee would apply, and typically the performance of the scheme would drive the guidance of pricing at future renewals, along with medical inflation.