'Pick and mix' insurance is not without its risks
Published 22/04/2014 | 02:30
The days of health insurance policies that cover all procedures, in all hospitals, are coming to an end.
These traditional types of "comprehensive" health policies have become too expensive to provide and are certainly getting too expensive for most families to afford.
In a desperate bid to stop families ditching their cover, insurers have had to be inventive. But the downside to this innovation is that less is covered.
This means that not every procedure will be fully paid for; while excesses have been introduced across most plans. This is the amount of a claim you pay yourself before the insurer picks up the tab.
Last summer, Aviva stepped up this trend further, by launching its Focus plans that restrict the hospitals where it will pay for procedures. The plans were 20pc cheaper than similar policies.
Laya followed with no-frills plans of its own, also with major restrictions.
Now GloHealth has taken this cheap cover trend to a new level by offering stripped-down cover, and allowing consumers to build the type of plan they want, by paying for add-ons.
Its Net range of plans cover the basics, with the likes of cardiac treatment in high-tech hospitals and private hospital cover optional, for extra cost.
Other insurers are now expected to follow this.
There is little else insurers can do if they want to stem the exodus of people from the market. Already this year we have had about four separate premium hikes and we are only a quarter way into 2014.
The Government, and specifically Health Minister James Reilly, have heaped extra charges and costs on insurers, who in turn, have passed this on to consumers.
The move by Finance Minister Michael Noonan to restrict the tax reliefs on health cover in the last Budget has also hit families hard.
So the response to all of this is that health insurance will become a "pick and mix" product. Young families, for example, will design a policy leaving little cover for hip operations.
That is because orthopaedic procedures are in greater demand from older people.
But the risk in putting self-designed cover in place is that people will get caught out and end up having to go to a hospital or having a procedure done that they do not have cover for on their policy.
Health cover will be more affordable, but no-frills insurance is not without its risks.
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