Alcohol and Health Insurance

Drinking alcohol, even in small quantities, according to some, can have an adverse affect on your health. In fact over-drinking is a big problem in the UK. The National Institute for Health and Clinical Excellence (NICE) have come out this week in support of a minimum price per unit for alcohol to act as a deterrent to over-consumption. For health insurance companies alcohol consumption is one factor which they take into account when working out your medical insurance premiums.

There is currently a great focus on sensible drinking from all sources and many (not the government however) do agree that hitting drinker's wallets is one way to reduce the levels of drinking. The NICE proposals were welcomed by Professor Gilmore, president of the Royal College of Physicians:

'I'm delighted that Nice has looked at the evidence and come to this conclusion. Despite the prime minister having ruled out minimum unit pricing, Nice's draft guidance will put this firmly back on the political agenda.

'Research shows that this does not disadvantage the majority who drink responsibly, despite the prime minister saying that it does, but instead targets those who are drinking at levels damaging to their health.'

Modern health insurance companies focus on prevention. They encourage a healthy lifestyle and one of the factors they focus on is moderate drinking. Some companies, namely PruHealth and Aviva reward healthy lifestyles with reductions in premiums.

With the effects of alcohol becoming a major health problem in the UK its financial effects are being felt in the health insurance industry. Private medical insurance companies are beginning to increase premiums for those who drink a higher than average number of alcohol units a week.

Kevin Carr, head of protection strategy at LifeSearch, said that increasing premiums in relation to alcohol consumption could lead to higher cases on non-disclosure (people not being honest in their application forms). He said:

'Alcohol consumption is very difficult to measure – it is not like smoking where you either do or you don’t. If people put down an honest consumption of, say, 30 units a week and then get quoted higher premiums, it could encourage people to lie about their alcohol intake.'

Despite this it is thought that in the future more companies will penalise those who drink more. According to Health Insurance magazine, Paul Keeble, from Standard Life, said that it is possible that someone who drinks more than 30 units a week will be asked by their insurer to supply a report from their doctor.

Private health insurance companies are also very clear in the policies when it comes to dealing with health problems that are related to alcohol abuse. In a nutshell they do not provide cover in these circumstances and it will always be included in the policy exclusion list. Aviva for example word it thus in their list of exclusions under What is Not Covered:

• Alcoholism, alcohol abuse, solvent abuse, drug abuse and other addictive conditions.

Unless there are significant changes in drinking behaviour in the UK then all health insurance companies will need to focus on how they will tackle the issue of alcohol consumption and most likely they will have to increase premiums for those who drink above the recommended limits in order to cover the increased costs of health care that they will need.