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Private Medical Trusts

Helping pay for the escalating costs of healthcare through Trust schemes

A Private Medical Trust could be beneficial for clients who have around 500 employees or more.

Essentially, a Private Medical Trust is a ‘pot of money’ that can be used to pay for eligible medical expenses incurred by employees. Your client – the business – makes payments into the fund. We administer it on their behalf and look after claims assessments, payments and the paperwork involved. Because the business sets the rules of the Trust, it has complete control and choice over the type and range of healthcare benefits provided.

The largest Private Medical Trust we look after provides benefit for approximately 15,000 employees and has been successfully managed by us for over 20 years. Private Medical Trusts are becoming increasingly attractive to companies with 500 employees or more – largely due to a combination of reduced administration, and potential savings as a result of a Private Medical Trust’s structure. Because the Trust is not an insurance contract, it does not incur Insurance Premium Tax (IPT), which is currently at the rate of 12%. Please note that tax rules may change in the future.

How does a Private Medical Trust work?

Your client chooses which type of Trust to set up:

  1. a non-discretionary Trust, which is fully funded by the employing company, or
  2. a multi-contribution Trust, which allows for voluntary contributions from beneficiaries of the trust (employees).

It may be quite daunting for your client if they've never set up a Private Medical Trust this way, so we recommend they take legal counsel about the process.

We then carry out the administration on behalf of the fund's Trustees in return for an administration fee. Your client's company makes contributions into the fund, and those monies are used to pay for eligible medical expenses incurred by beneficiaries of the Trust. A dedicated account management team provides all the day-to-day support needed, whether it's sending out new joiner packs; assisting with queries on taxation; or contributing to the analysis of Management Information in meetings with Trustees and group administrators.

What are the advantages of a Private Medical Trust?

With us managing the membership on your client’s behalf, there’s a long term reduction in the administration your client needs to undertake. Alternatively, clients can manage the membership themselves. In either case, we’ll implement a personalised claims service that can help people to return to work as soon as possible.

Our association offers access to healthcare experience and medical expertise, which could help employees improve their health and wellbeing and – as a result – improve productivity across the business. Our services can help them return to work more quickly after a period of ill health.

We can help to raise awareness of Aviva’s relationship with your client. Through a Private Medical Trust, we can promote services such as access to:

  • Aviva Digital GP - new interactive app available, that effectively puts a GP in a client’s pocket. For Trust clients, please contact your usual account manager to discuss Aviva Digital GP access. For more information see our flyer (PDF 174KB).
  • Discounts on travel and motor insurance. This could help to enhance your clients profile and perception among employees.

And of course, probably the most attractive benefit of taking out a Private Medical Trust is that it doesn't incur Insurance Premium Tax (IPT) on the claims fund, which will help to save your clients money.

This document will explain in more detail how the Trust works and can be used with your clients

Private Medical Trust (post 1 October 2018) (PDF 5730KB) – client-facing pre-sale brochure.

WC00843 09/2018

Can we help you?

Think of us as part of your team. For help or queries, call us on:

0800 206 2178

9.00am – 5.00pm, Monday – Friday

For scheme quotes, please email:

Calls to and from Aviva may be recorded and/or monitored

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