Vhi to hike prices on premiums by up to 6pc next month
Published 31/03/2016 | 02:30
The majority of Vhi's one million customers are facing a price increase from next month which will see the cost of some family plans rise by nearly €144 a year.
The hike, which will average 3pc but will be as much as 6pc for some plans, was defended by the insurer yesterday despite coming just months after its last increase of up to 5pc in November.
Declan Moran, the director of marketing and business development, said: "We regret that it is necessary to increase prices. The main driving factor is the rising costs of claims.
"But the price increase is also necessary to allow Vhi to continue to provide our customers with access to the very latest in healthcare such as emerging technologies, new treatments and high-cost drugs."
He insisted: "We will continue to focus on cost containment through targeted claims efficiency programmes, increased activity of our special claims investigation unit and the continued transition of procedures to lower cost medically appropriate setting."
The 'Start Plan' which was taken out this time last year by many consumers to avoid paying penalties for waiting to get health insurance after the age of 35 will remain at the launch price of €449 per adult.
People who took out insurance before May 1 last year for the first time are currently renewing and will avoid the hikes for now.
However, families in particular will feel the brunt of the rise.
The One Plan Family, for two adults and two children on full rates, will go up from €2,708.10 to €2,851. The Parents and Kids Plan will also increase from €1,555.76 a year to €1,655.84.
All the prices are net after tax relief. The First Plan Level 1 goes up from €967.04 to €1,040.56.
A spokeswoman insisted that the State insurers prices had been the "lowest in the marketplace over the last number of years".
Health insurance expert Dermot Goode said he was not surprised at the latest hike and he expected nearly all insurers to increase their prices every six months.
"Rather than having just one big price increase they are having smaller, incremental increases. Some plans don't go up at all but others increase substantially," he said.
"When the renewal notice lands, consumers need to shop around smartly. Get advice or look up the Health Insurance Authority website. People who shop around every year get great value. They are not afraid to switch. They switch between all four companies for the best deals," he added.
He said the people who did not switch, particularly older subscribers, tended to pay too much.
"It is possible in some cases to stay with the same insurer, double cover yet pay €70 to €80 less per person annually. You would need to be paying €800 and €850 per adult to get half decent health insurance cover," he added
The Vhi has 81 plans for sale, a reduction in number in recent years.
Mr Goode said claims costs were increasing for all health insurance companies across the board due to new drugs, technologies and the volume of claims.
"Laya increased prices in September and March. Aviva went up in January. Glohealth had a couple of price increases. We are going to see this continuing," he added.