Clarity Health Insurance has argued that the UK is moving towards to a three-tier health system, with “most” private medical insurance (PMI) providers now offering a guided network option to make policies more affordable.

These guided networks are offered alongside full PMI policies and the NHS.

Clarity Health Insurance, an independent whole-of-market health insurance broker, warns that guided networks differ significantly among insurers. I argues that this increase in options can add complexity to the market, necessitating thorough training for advisers.

It says that a PMI policy with a guided network (or “guided options”) restricts the list of consultants and hospitals available for care. These policies can be as much as 53% cheaper than standard all-market options, while still providing access to thousands of consultants nationwide.

In the past 12 months, 61% of new policies sold through Clarity Health Insurance included the guided network option, reflecting growing consumer demand.

Kyle Godden, managing director at Clarity Health Insurance, said: “We are witnessing the evolution of the UK health market into a three-tier health system. With pressures on the NHS, there is a rising demand for private healthcare from a broader audience. Insurers have responded by offering more restricted products to lower costs and attract newer customer demographics.

“PMI policies with a guided network are hugely popular and for good reason. However, once you scratch below the surface, the difference in quality between insurers becomes more apparent. This adds further complexity to the industry and underscores the need for specialist advice. For example, the number of consultants in a network can vary from 4,000 to 19,500, and some are more geographically restricted.

“Additionally, insurers are not always required to inform customers about changes or restrictions to their networks, even if these occur mid-term. As demand for guided network policies continues to grow, we urge insurers to prioritise sharing updates so brokers can provide the best advice to their clients.”