Charlie Weston: ‘Failure to seek out better value health insurance could see families having to fork out an additional €1,000 to €2,000’
Published 15/01/2016 | 02:30
IF you are one of the thousands of people whose health insurance is up for renewal then you need to be careful - very careful.
Around a million people are due to renew their cover in the first three months of this year. But the odds are high that in the last year your plan will have gone up in price, may have its benefits reduced or the plan may have been withdrawn altogether.
Insurers are constantly tinkering with their offerings. Small and regular price rises have been a feature of the last year from some of the insurers.
Some plans have gone up by as much as 26pc, while with others, price cuts and price freezes have been introduced. Many will find that when they come to renew, the plan they were on will have risen in price by up to 14pc.
This means that a failure to seek out better value could see families having to fork out an additional €1,000 to €2,000 if they are not careful. And they may not even end up with better cover for all that extra expenditure.
A number of plans, which were good value, now have serious questions marks over them.
Think hard if you are due to renew on the VHI's Parents & Kids, Family Plan Plus Level 1 and Company Plan Plus Level 1.
For Laya customers, there is a question mark over how competitive its Health Manager and Company Care plans are, according to broker Dermot Goode of TotalHealthCover.ie
Aviva customers should be wary of Level 2 Hospital plans. And Glo's Better and Best plan are not the good value they were.
In fact, anyone renewing on a plan they have been on for two or more years needs to examine it and make very sure they are not going to overpay.
The good news is that all four health insurers have discounts, special offers and good value corporate plans. For example, VHI has a half-price offer for children on its One plans. Laya has a two-year price freeze on its Flex 175 Explore and Future Protect plans.
Aviva is reducing the prices on its Select Plus plan, while GloHealth is offering free children's cover on its Bloom plans.
The problem is the complexity of all of this as there are now close to 420 different health plans out there.
Here is a plan of action.
Determine your budget. You need to spend at least €800, and probably around €1,200, per adult, for decent cover.
Remember that the levy imposed on most plans by the Government is €399, so if you are buying a plan for €500, ask yourself how actual health cover will be included in that scheme.
Ask your insurer for the most competitive plan for your budget. Tell the person on the phone you are recording the conversation. Make them write to you with their recommendation. Ask what benefits you will lose or gain compared with your current. And repeat this exercise with at least one competitor.
Alternatively, contact a broker to do this work for you.
The bottom line is that health insurance has now become a highly complex product and you need to spend time to get it right.
Here are some top tips on cutting the cost of health insurance:
Review your cover
For those who have been insured on the same plan for three years or more, it may be well worth their while reviewing their cover. For the older plans that have been on the market for some time, it means that they have been hit by all the price increases since launch.
Take an excess to save money
An excess is the amount of money you will have to pay out before you can make a claim. By taking on a small excess - for example €75 to €125 - you may be able to reduce your costs considerably, says Mr Goode.
Be sensible with your accommodation preference
Unless you insist on a private room in a private hospital, then you don't need to hold this level of hospital cover. You could save €500 per adult by dispensing with the requirement to have a private room. Remember, there is no guarantee you will get a private room.
Split your cover
Split cover is a great way of reducing your costs. You could leave the adults on a mid-range plan and put the younger children on a lower-level plan. Depending on your provider and the plan held, this could save you up to €200 per child.
Pay the full amount for the year
Avoid surcharges by paying in full in advance. Some insurers charge an additional 3pc for instalment payments.
Check out corporate plans
Corporate plans are typically designed for large corporate clients who fund the cost of health insurance for their employees. These plans are always priced very competitively and anyone can avail of them, regardless of what they're called.