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Health insurance excess explained

When taking out private health insurance, one of the key terms you’ll come across is excess. But what does excess mean in health insurance?

Published - 30 Oct 2025

This guide breaks down everything you need to know about health insurance excess. We'll look at how it works and how much you might pay. We'll also assess how it affects your premiums and what to consider when choosing the right excess for your needs.

What is health insurance excess?

A health insurance excess is the amount you agree to pay towards the cost of a claim. Once you’ve paid this amount, your insurance provider covers the rest, subject to policy benefit limits and eligibility . You’ll choose your voluntary excess when you take out your policy. The amount is up to you, and you’ll always know what to expect if you need to make a claim.

Some providers may also include a compulsory excess. This is a fixed amount set by the insurer that you’ll need to pay if you make a claim. This is separate from any voluntary excess you may choose and is a standard part of some policies.

New to health insurance? Check out our guide to what health insurance is. It will help you understand how it works, what it covers and how it can support you when you need it most.

How does health insurance excess work?

You’ll agree to an excess amount when you take out your health insurance policy. This is the part you’ll pay towards the cost of any approved treatment.

For example, if you choose an excess of £100 and your treatment costs £700, you’ll pay £100. Your insurer will cover the remaining £600.

Can you change your policy excess once you’ve taken out your health insurance policy?

In most cases, once you’ve chosen your excess and your health insurance policy has started, it can’t be changed until it’s time to renew. That’s why it’s important to choose an excess that feels right for you from the start.

Some providers may offer a cooling-off period. This is often between 14 and 21 days after you buy your policy. During this time, you might be able to make changes. This could be adjusting your excess or cancelling your policy altogether.

If you’re unsure, it’s always worth checking the terms of your policy or speaking to your provider for guidance.

How much is a policy excess?

The amount you’ll pay as a health insurance excess depends on two things:

1. The voluntary excess you select when you take out your policy.

2. Any compulsory excess set by your provider.

These two amounts are added together to give the total excess you’d need to pay if you make a claim.

How often do you pay a policy excess?

Often, you’ll pay your health insurance excess once per policy year, per person — no matter how many claims you make. For example, if your policy year starts in January and you make a claim in February, then another in April, you’ll usually only pay the excess once for that person during that policy year.

But what if your treatment spans two policy years? For example, if your policy renews in March, but your treatment begins in February and continues into April. In this case, you may need to pay the excess twice.

Some insurers apply the excess each time you make a claim. This could increase your out-of-pocket costs if you need treatment more than once in a policy year.

It’s always a good idea to check your policy details before you buy. This ensures you’re fully aware of how your insurer handles excess payments.

How to make a claim when you have an excess

Need to make a claim on your health insurance, and your policy includes an excess? Here’s a step-by-step guide to help you through the process:

1. Check your policy. Confirm your excess amount and whether it applies per claim or policy year.

2. Contact your insurer. Let them know about your condition and the treatment you’re planning to undergo. They’ll confirm whether your policy covers it, and in many cases, they’ll also help you complete the claim over the phone.

3. Get approval and receive treatment. If your treatment is approved, you can go ahead with it.

4. Pay your excess. You’ll usually pay this to the hospital or specialist after treatment.

5. Submit your claim (if needed). Depending on your insurer, you may need to complete a claim form and provide supporting documents. In some cases, this step is handled during your initial call or by the provider on your behalf.

6. Track your claim. Your insurer will process the claim and cover the remaining eligible costs. You can usually track the progress online or by contacting them.

Who do you pay your health insurance excess to?

In most cases, you’ll pay your excess to the hospital or specialist who provides your approved treatment. Your insurance provider will explain how and when to do this once your claim has been approved.

Example: If your excess is £250 and your treatment costs £1,000, you’ll pay £250 to the hospital or specialist. Your insurer will then cover the remaining £750.

The impact of excess on premiums

Choosing a higher voluntary excess on your private health insurance policy can often reduce the cost of your premium. By agreeing to pay more towards the cost of a claim, you’re lowering the financial risk for your insurer.

In return, your monthly or annual payments may be lower. So, choosing a higher excess may be a useful option if you’re looking to balance cover with affordability.

Choosing your excess amount

Selecting a higher voluntary excess can help reduce the cost of your premium. But it’s important to remember that this is the amount you’ll need to pay if you make a claim. So, it’s not just about finding the cheapest policy. It’s about choosing an excess you’d be comfortable paying if the unexpected happens.

Opting for a lower excess may result in a slightly higher premium. But it could make things more manageable if you do need to make a claim. Consider what works best for you and budget accordingly, so you can feel confident in your decision.

Who underwrites Saga Health Insurance?

Saga Health Insurance is a unique product designed by us specifically for our customers and it is only available through us. Together with our underwriter, Bupa Insurance Limited, we are committed to providing high levels of quality, service and choice. That's why we offer a range of policies that can be tailored to suit your needs and budget.