People who signed up to a health insurance policy offering free gym membership could now pay up to £600 a year more because of a change to the policy's terms and conditions.

PruHealth, part of the insurance giant Prudential, has just finished a national advertising campaign under the slogan 'Why Pay For The Gym?'. The campaign promoted its health insurance policy, which gave regular gym-goers discounts off membership, with the possibility of free membership after sufficient visits.

However, PruHealth is writing to its 175,000 policyholders in stages to advise them that their monthly gym fee could increase. From 1 November the fee will be based on a policyholder's 'Vitality status', not on how often they use the gym.

Every PruHealth member already has a Vitality status of Bronze, Silver, Gold or Platinum based on the number of 'Vitality points' they have. Points are accrued by health-related activities such as having a screening, reading self-help articles on the PruHealth website or buying healthy food at Sainsbury's. At renewal, policyholders start again, although between 10 and 25 per cent of the previous year's points are carried over depending on how long the policyholder has been with PruHealth. A full health screening, costing up to £375, would earn a member 400 points, for example, whereas a trip to the gym would give 10 points. Points for gym trips are capped at 150 a month.

The policy changes will mean that only Platinum members - those who have accrued 2,000 points by November - will pay the same or less for their gym membership. All others will pay more.

In addition, no one living within the M25 will be eligible for free gym membership from November, whatever their membership status. The cheapest gym fee will be £8 a month. The insurer has changed the website it directs members to from www.whypayforthegym.co.uk to www.stepuptovitality.com.

The changes have angered many policyholders. 'If I carry on with my twice-weekly gym attendance, my membership fee will rise from nothing a month to £50 a month,' one reader told us. 'PruHealth is letting customers leave the scheme, but members who joined primarily for the gym offer may have paid several months' premiums and never received any free membership' - because the new regime will come into effect just as they accrue enough points to get free visits.

He adds: 'Customers could also be paying for health screens and other products promoted by [PruHealth's] call centre to achieve discounted gym membership in the future, yet PruHealth may change its awards at any point.'

A spokeswoman for PruHealth said the changes were brought in to coincide with the introduction of three new partners to the scheme: Eurostar, Cineworld and Mark Warner: 'All our other existing partners and these new partners work on Vitality points-based models. Our gym partners were the only ones that were frequency based. We have decided to align all our partners to become points-based.'

She also said the changes were being made to encourage members to concentrate on other areas of their health, not just going to the gym: 'Anyone who feels that they will be worse off can cancel without any penalty if they want to.'

Asked what relevance Cineworld, a cinema chain, had to health, the spokeswoman replied: 'We thought we would move into the area of "treat yourself" lifestyle partners. People might sit with a huge vat of Coke and a tub of popcorn, but our policy is about a carrot-and-stick approach and you don't want to just beat people with a stick.'