Private medical insurance has become the most important perk that employees look for in their benefits package, new research has found.
The findings from employee benefits technology company Zest sees a third (32 per cent) of employees rank private medical insurance ahead of other well-known benefits such as increased pension contributions (30 per cent), high street discounts (21 per cent) and a company car (17 per cent).
Despite the demand for medical insurance to be offered through work, only 14 per cent of employees said their company currently provides this as a benefit. In June, NHS waiting times rose to 7.5 million people in England for the first time, with nearly one in seven on a waiting list for routine treatment. Of the employees who do have access to insurance through work, one in ten (10 per cent) said they had needed to use it in the last year.
Employees also ranked medical insurance ahead of benefits that could potentially help them with the current costs of living crisis, such as employer support for home energy costs (25 per cent) and workplace savings schemes (21 per cent). The demand for private medical insurance is also higher amongst female employees compared to males (33 per cent vs 29 per cent) as well as those aged over 55 (44 per cent).
The findings highlight the growing challenges in the UK around access to healthcare, as more people look to private provision as a means of reducing their reliance solely on public healthcare.
The wait for treatment has meant significant growth for the UK’s insurance industry and initiatives to better meet current customer needs. One of Britain’s biggest insurers, Aviva, announced it had gained 170,000 health insurance customers in the past year either directly or through their employer**, while Simplyhealth recently launched a new service to help customers avoid long wait lists for MRIs, CT, X-ray and ultrasound scans.
Matt Russell, CEO at Zest, said: “Over the last year we’ve seen the UK’s National Health Service face some of its toughest challenges ever, from strike action over pay to record waiting times for routine treatment.
“It’s no surprise that more people are considering private healthcare, but with the significant cost that accompanies this, many are now putting medical insurance at the top of their list for benefits they want to see from their employer.
“Employers need to take note of this demand and look at how they can adapt their benefits offer to meet the current needs of employees, if they are to attract and retain talent.”
Zest’s own data on employee benefits usage showed that in the last year there has been an 8 per cent increase in eligible employees using their private medical insurance, yet in the same period there had only been a 1.5 per cent increase in overall eligibility, highlighting that provision is not necessarily keeping pace with employee demand.
The findings build on previous research by Zest, which found that employers in the UK are increasing investment in their employee benefits packages as they attempt to gain a competitive edge in attracting talent.
Nearly half (48 per cent) of employers say they have boosted investment in their benefits package over the last 12 months in response to the changes in the economic climate. The research highlights the challenges businesses are facing in today’s competitive job market, with four in ten (42 per cent) businesses saying they are now struggling to hire talent.
Zest is an employee benefits platform that offers flexible benefits services for a wide range of well-known businesses across the world, including Hargreaves Lansdown, Taylor Wimpey, ADP and Travis Perkins.