Healthcare benefits are rapidly moving into the insurance mainstream, with employer-funded private medical insurance (PMI) and health cash plans becoming central to benefit strategies as pressure on the NHS intensifies.
Broadstone's second Employee Benefits Landscape Report signals robust demand for health cover, while market figures from the Association of British Insurers (ABI) confirm record claims volumes and rising penetration for PMI, particularly via the workplace.
According to Broadstone's data, almost a third of employers who do not currently offer PMI are considering doing so within the next three years, representing a clear opportunity pipeline for health insurers and intermediaries. The proportion of organisations without PMI but with definite plans to introduce it rose from 9% in 2023 to 11% in 2025, while the share "considering" PMI has climbed from 15% to 20%. Over the same period, those with no plans to introduce PMI fell from 74% to 68%.
For insurers, this shift indicated that more employers are moving PMI from a "nice to have" to a core risk and reward management tool, with new scheme launches and benefit upgrades likely to fuel premium growth.
Insurers process record claims
On the supply side, the ABI reported that health insurers processed a record £4 billion in individual and workplace PMI claims in 2024 – up 13% on £3.57 billion in 2023. Workplace cover has also now hit a second consecutive record high, with the number of people covered by health insurance increasing 4% year-on-year to 6.5 million in 2024, of which 4.8 million were insured through workplace policies.
This momentum is playing out across the wider health benefits market, Broadstone data shows. The proportion of employers offering clinic-based screenings rose from 20% in 2023 to 25%, while onsite day screenings increased from 7% to 10%. The health cash plan market is also expanding: employer provision edged up from 24% in 2023 to 26% in 2025, and a further 26% of employers are considering introducing a cash plan in the next three years.
"What's particularly striking is the growing pipeline of employers actively planning to introduce or expand healthcare benefits over the next few years," said Brett Hill, head of health and protection at Broadstone. "Organisations are also taking a more preventative approach, with greater uptake of screenings and health cash plans, reflecting a broader shift towards early intervention and long-term workforce resilience.”
Strain on NHS intensifies
Meanwhile, the continued strain on NHS capacity is a critical macro driver. Persistent waiting lists and access challenges are pushing more employers to view PMI less as a discretionary perk and more as risk mitigation against lost working time and long-term sickness. This reinforces demand not just for traditional "acute care" PMI but also for specialist options, such as virtual GP services, mental health pathways, rehabilitation and chronic condition management, areas where insurers have been expanding product and service capability.
“The NHS remains under significant pressure which means that businesses increasingly view access to timely diagnosis and treatment as a critical factor in supporting employee wellbeing, productivity and retention," Hill said.
At the same time, insurers must balance growth with sustainability. Rising claims volumes, higher utilisation and medical inflation will continue to test pricing and benefit design. The research said carriers are likely to lean more heavily on network management, digital triage, clinical pathways and data analytics to keep PMI schemes affordable while maintaining access and quality.
