Most of what a small business health insurance broker does for a firm happens after the first quote: setting the scheme up on a basis that suits the people on it, handling the paperwork when someone starts or leaves, and going back to the insurers when a renewal lands after an expensive year. If you are deciding whether to hand that work to a broker, and to which one, this page covers what the job involves and what to check first. A broker can price a scheme on your own staff list across the insurers it works with. Whatever your firm sends via the form on this page is passed to the one FCA-authorised broker this site introduces, and asking it for a price costs nothing.
Our own position, stated before the detail: this site is not a broker, holds no FCA authorisation and arranges no cover. It introduces readers to a single authorised broker, which may pay us a fee for every introduction. We therefore rank no brokers and name none as the best for small business, and every check below applies to the firm we introduce as much as to any other. What cover to specify, and what a scheme costs per head, are the subjects of private health insurance for small businesses and what company health insurance costs.
What a small business health insurance broker does, from set-up to renewal
Firms differ in how much of this they take on, and terms of business and group wordings vary, so read what follows as work that may be on offer, and confirm it with whichever firm you speak to.
Before the scheme starts
Turning intentions into something quotable. “Cover for the team” is not a request an insurer can price. A broker can take you through the choices that make it one — eligibility, dependants, excess, out-patient cover, hospital list — and should know which of them a given insurer lets a firm of your size choose.
Collecting the quotes. A group premium is built from your staff list, so each insurer generally needs that list and the specification before it will quote. Gathering the answers and setting them side by side on the same terms is slow work for a firm doing it alone, one insurer at a time.
The underwriting basis. In a firm of six you probably know who has a bad back or a heart condition, which makes this the decision a small employer feels most. The bases on offer at your headcount are each insurer’s to decide; the routes themselves are listed, in one insurer’s handbook wording, on whether insurers cover pre-existing conditions. Where some staff already hold cover, from a previous scheme or a policy of their own, ask whether any insurer would take them on keeping the terms they have; switch terms for an individual policy are explained on using a broker to buy private health insurance.
The set-up itself. The application is in the business’s name, with a start date and a member list, and each employee then needs to know how to use the cover. Ask whether the broker handles both, or hands you to the insurer once a quote is accepted.
During the year
A firm of eight that hires two people has grown by a quarter, so settle three things before you sign:
- Joiners. Who you notify, from what date a new starter is covered, whether they join on the scheme’s basis or are underwritten separately, and whether the premium changes straight away or at the anniversary.
- Leavers. How someone comes off the scheme, and whether the insurer offers them cover in their own name afterwards. That offer is the insurer’s, not the broker’s, but a broker can find out what it is before the person’s last day.
- Claims. As a rule the employee claims with the insurer, not through you, and where an authorisation stalls a broker that looks after the scheme may be someone to call. Ask whether it will speak to the employee directly, and what, if anything, about a claim it would pass back to you; staff may not want their employer hearing the details.
At each anniversary
The renewal terms come from the insurer. Why any renewal moves is covered on your health insurance renewal price. What a broker can add is going back to the insurers it deals with — but whether it does so every year or only when you ask is a question for the firm, and so is whether it will show you which insurers it approached and what each said. The anniversary is also, in general, when the excess, hospital list or eligibility rule can be changed, so look at the scheme then, not only at its price.
Choosing among health insurance brokers for a small business
No firm is right in the abstract. Three questions, in order, narrow it down.
One placement, or someone to run the scheme? A firm of five with a settled team may want little more than the quotes and the application. One that hires often gets more from a broker that stays involved through the year. Decide which you want before the first call; a firm’s website will not always say which it sells.
What kind of firm? Three sorts of business commonly present themselves as a small business medical insurance broker:
- A private medical insurance specialist, whose day-to-day work is health cover. Ask whether schemes as small as yours are work it takes on.
- An employee benefits firm, which may also handle pensions, life cover and income protection. Useful for several benefits under one roof; ask how many of its clients are your size.
- The commercial broker you already use for liability or premises insurance. Convenient, and it knows your business, but ask how much private medical insurance it places itself and, if it passes health cover to another firm, which one.
How is it paid? In general, commission from the insurer is the usual arrangement, and some brokers charge a fee instead or as well; our page on what a health insurance broker costs you sets out how each pulls on the advice. One point is particular to a company buyer. Under the FCA’s Insurance: Conduct of Business sourcebook (ICOBS), a broker must, if asked, tell a commercial customer — which a firm buying a staff scheme would normally be — the commission it receives on the policy; the sourcebook is in the FCA Handbook online.
Going direct stays open throughout. A small firm can approach insurers itself; what it gives up is the comparison done in one place and a second party to call at claim or renewal time. If what you have read so far points towards using a broker, the one this site introduces takes enquiries from the form on this page; the questions below are a fair test of it, including whether it would look after the scheme or only place it.
What to ask a medical insurance broker for an SME before it approaches insurers
Start with the regulator. Take the firm’s name and reference number and look it up on the FCA’s Financial Services Register, which shows whether it holds authorisation itself or trades as another firm’s appointed representative; our page on broker reviews explains how to read the entry. Do it before you send a staff list carrying dates of birth — for the broker this site introduces, which is not named here, that means once it has been in touch. The general questions for any broker, on its panel, its pay and what happens to your details if you do not proceed, are on our main page on using a broker. These are the ones a staff scheme adds, roughly in the order the answers start to matter:
- How many schemes of our size do you look after, and with which insurers? A good firm built around fifty-person schemes may still be the wrong home for six people; a panel is normal, so get its edges in writing, for group business specifically.
- Which underwriting basis would you suggest for us, and is that a recommendation or information for us to choose from?
- When someone joins or leaves, do we tell you or the insurer?
- If an employee’s claim stalls, will you take their call, and what would you tell us about it?
- What do you do before each renewal, and will you show us the alternatives you looked at?
- What commission, or fee, will you receive on this scheme? As a business you can ask for the figure, under the rules above.
Those test the broker. Questions about the scheme itself — whether directors-only groups count, who pays the excess, how dependants are priced — are on the small-business page, and the broker-versus-agent distinction on our page on brokers and agents.
Small business brokers: short answers
Is a medical insurance broker for an SME different from one for individuals?
Often it is the same firm, but the work differs: a scheme is quoted on a staff list, its underwriting basis is usually set once for the group, and its renewal can turn on what the group claimed. Ask whether a firm arranges schemes as well as personal policies, and at what size.
Should a small business use a health insurance agent or a broker?
In UK usage an agent is generally tied to one insurer or a few, which can suit a firm already set on one insurer. A scheme is built on choices — eligibility, underwriting basis, excess — that insurers treat differently, and seeing several insurers’ answers side by side is what a broker, within its own panel, is for.
Which is the best health insurance broker for a small business?
No ranking appears here, for the reason given at the top of the page: any order we put firms in would be suspect. The best fit is the firm that answers the six questions above clearly for a scheme your size, and the place to start checking any firm is the FCA’s register.
Once you know the list of people you want covered and what you want a broker to do for them, the next step is a conversation. Complete the form on this page. When the broker we introduce gets in touch, ask for its reference number before anything else.