Bupa through work - does this cost me?

Clark80

Hi, a silly question...

I get Bupa through my employer and usually get a p60 once a year that details the insurance.

As I understand it I am sort of paying for it through an adjusted tax code (although cheaper than buying a personal policy).

Am I correct in thinking if I cancel the policy - my tax code will be re-adjusted and I will take home slightly more money? I know it won't be a lot but I'm trying to work out how much Bupa is 'costing me'

Thanks for your help

InsideInsurance

Your P11D should say what the declared value of the cover is (or your HR department should be able to say too). You will then just pay the tax on that amount - 20% or 40% depending on your earnings

So if the cover is considered to be worth £1,000 and you are a lower rate tax payer it will be costing you £200 a year

Quentin

Clark80 wrote:

Am I correct in thinking if I cancel the policy - my tax code will be
re-adjusted and I will take home slightly more money?

Yes, if you don't have the benefit in kind you don't pay the tax on it, thus your code will go up and overall you will pay less tax than you currently do.

Clark80

Sorry should have said P11d

The policy has a number of exclusions so I'm thinking to cancel it and look at other forms of finance as and when I need treatment.

Thanks all for your help!

InsideInsurance

It obviously will vary on personal circumstances but the last time I was an employee I had very comprehensive cover including for pre-existing conditions and was personally paying about £450 a year for family cover. Now that I am freelance the same cover is £1500 and it took a fight to get the pre-existing conditions covered at any price.

marathonic

It's a similar story with my company health insurance.

My thoughts are that group schemes are cheaper to administrate than individual schemes so my employer is likely getting a good price anyway.

I know that, as a healthy young person, my premium within a group scheme with no medicals will be subsidising the older members and those with medical conditions.

However, I also know that, unless the company passed the savings of me cancelling onto me, it'll be impossible for me to get as much value elsewhere.

Why would you want to cancel if it's only costing you 20% of the premium. It looks like penny-pinching in areas where you could seriously regret it in the future.

wozearly

Clark80 wrote: »

The policy has a number of exclusions so I'm thinking to cancel it and look at other forms of finance as and when I need treatment.

Self-financing private healthcare on an ad hoc basis is perfectly reasonable if you only expect to require the odd bit of out-patient treatment, or if the exclusions you refer to are about pre-existing conditions that Bupa have declined to cover that you would want private treatment for, or if you plan to always use the NHS except in unusual circumstances.

If you are thinking of setting aside a fund that could be used for private treatment, bear in mind that the reason that health insurance is pricey is that private treatment for anything major or long-term tends to be hideously expensive. People tend to underestimate the costs significantly, because we're not used to seeing the actual cost of providing tests and treatment.

marathonic

Also, bear in mind that some work plans allow you to add children at a very low cost.

rs65

Clark80 wrote: »

Am I correct in thinking if I cancel the policy - my tax code will be re-adjusted and I will take home slightly more money? I know it won't be a lot but I'm trying to work out how much Bupa is 'costing me'

The P11D value of my private medical cover is about £360 so about £12 a month. If I saved that it would take a long time to self finance any treatment.

I would suggest you ask your HR if it is possible to rejoin at a later date if you ever wanted to. I think you can only join our scheme at commencement of employment.

luci

Company schemes are usually excellent value for money as you are only paying tax, possibly 20%, on an already reduced premium.

Based on the assumption above of £1000 costing you £200 a year in tax, that is only £4 a week. It is quite possible that your premium could be considerably less than £1000.

Before you make any rash decisions for such a small amount you first need to check what your actual premium is. Then you could check the cost of treatment with your local private hospital. I would also suggest calling BUPA and asking for a quote as a personal customer, bearing in mind that the cover may be much less than through a company.