Small business owners should consider small business health insurance as a valuable employee benefit and staff retention tool. Most small business cannot afford to lose a member of staff for any length of time, the business is usually run by the directors or partners and each has a vital role in the business. Consider the fact that if one of these key members of staff were to contract a serious disease or illness that could not be treated quickly by the NHS, how would the small business cope financially?

What is covered under small-business health insurance?

Core Cover under the small business health insurance offers extensive benefits that are traditionally associated with private medical insurance, and typically covers things like:

• Hospital charges

• Specialists' fees

• Diagnostics tests

• Radiotherapy/chemotherapy

Nearly all small business health insurance providers will offer upgrade options to core cover for things such as dental and optical option and an extended hospital list to give wider choice of where the member of staff can be treated.

At the same time there are a number of options that be used to reduce the core premium, these tend to be things like:

• Six Week Option: this option means that if the NHS can treat a member of staff within six weeks then private cover is not required. Unless the waiting list is 6 weeks or more, in which case they can receive private treatment without delay.

• Staff excess option: reduces the premium by applying a claims excess of Ł50, Ł100, Ł150, Ł200 to the policy. The excess is an annual recurring option.

• Benefit Reduction, some cover options can be removed from the standard policy cover options, for example if a scheme was all male then infertility and pregnancy clauses could be removed.

• Reduced Out-patient Cover and Selected Reduction Benefit: reduces the premium by limiting out-patient cover and some additional benefits.

• Hospital Lists: reduces the premium by reducing the number of hospitals available.

Before considering reducing options employers should seek advice from the providers or better still from an independent health insurance adviser, the adviser can explain cover options and advise on the correct cover for the individual small business.