Cartwright Employee Rewards has called on employers to begin reviewing private medical insurance arrangements earlier in the renewal cycle, citing sustained premium increases driven by medical inflation.
The financial services consultancy, which specialises in risk, healthcare insurance, and workplace pension schemes, noted that medical inflation currently sits at 17%. The firm expects this figure to remain in double digits into 2026.
Not just in the UK, these pressures are being felt worldwide. Howden's global study projects medical inflation to reach 7% in 2026 on a net-of-CPI basis, pushing total cost inflation for health plans well into double digits. The study found that 93% of employers expect their medical expenses to climb further, with more than four in 10 anticipating a significant increase.
For many employers, the inflationary environment is resulting in continued rises in PMI premiums. This has prompted closer scrutiny of how healthcare benefits are structured, funded, and delivered across workforces.
John Mullally (pictured above), group risk and healthcare consultant at Cartwright Employee Rewards, said: "Your PMI renewal is a perfect opportunity for employers to step back and properly assess their options."
He added that the consultancy is observing stronger outcomes among employers that adopt a more strategic approach. This includes evaluating how preventative benefits and cash plans with excess options can complement PMI to manage claims and reduce long-term costs.
Howden's data supports this direction, showing that 67% of employers globally are now directing resources toward prevention and wellbeing initiatives to curb rising claims. In the UK, uptake of preventative investment stands at 72%, one of the highest rates regionally.
"Early intervention, health screening and better plan design can make a meaningful difference, both financially and in terms of employee outcomes," Mullally said.
Mullally also noted that employers who use the renewal process to evaluate their approach are better positioned to maintain the sustainability of their PMI schemes. He encouraged businesses to engage with advisers, explore available options, and avoid defaulting into automatic renewals.
"Taking the time to speak with advisers, understand the options available and avoid defaulting into automatic renewals can make a meaningful difference to both cost control and employee outcomes," he said.
