Sunday 25 September 2016

Think about alternatives to spending €100k on insurance you may never use

Published 25/04/2015 | 02:30

With a decent package costing more than €1,000 a year, a couple can expect to pay well in excess of €100,000 over the next 50 years for insurance they may well never use
With a decent package costing more than €1,000 a year, a couple can expect to pay well in excess of €100,000 over the next 50 years for insurance they may well never use

Private health insurance is one option when it comes to health but it is important to remember that there are alternatives.

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With a decent package costing more than €1,000 a year, a couple can expect to pay well in excess of €100,000 over the next 50 years for insurance they may well never use.

Remember that a couple who invested that sort of money in the stock market year after year would be likely to end up with an investment fund of anywhere between €200,000 and €300,000 which could go a long way to meeting the cost of any treatment or service needed in old age.

Anybody who is spending this sort of money (and ignoring the potential to build up a nest egg instead) would be wise to avoid artificial deadlines imposed by the Government and consider their options carefully.

An obvious question is whether the public system really is as bad as so many people believe. France has a healthcare system that is the envy of the world but life expectancy there is 81.5 years compared to the 81.4 years reported in Ireland. For all the wonderful care, the French live just a few days longer than we do.

The real problems with the Irish system often seem to be aftercare. We are poor at looking after stroke victims for example but private health insurance here does little to help you if your are unlucky enough to endure a stroke.

Perhaps you would be better off saving money to pay privately for help to recover from illness rather than paying for private insurance itself?

Many people will fear, not unreasonably, that lack of private health care will prevent them seeing hospital consultants quickly which will in turn mean that serious illnesses such as cancer are not diagnosed in time for effective treatment. This is a reasonable worry, although many people in the public system are seen quickly; especially if they have good GPs.

Those who believe that they are not been seen quickly enough in the public sector always have one option open to them; to consult a doctor privately.

Even the best doctors rarely charge more than €200 a pop, so you would have to be averaging several consultations a year for private insurance to make sense.

There is little doubt that private hospitals offer better amenities. Carpets are nice. Interesting meals can be lovely. A room of one's own is splendid, although there is some evidence that patients recover better when they have neighbours to chat to or call a nurse if they relapse.

This is expensive and few people in middle age will be able to foot the bill themselves. But think of the opportunity cost - the hundreds of thousands of euros that these carpets and menus will end up costing you. Is it worth it? Only you can tell.

Private health insurance is a no brainer for those with congenital illness or those who come from families beset by bad health.

For everybody else, it is worth thinking hard before signing up.

Irish Independent

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