Laya blames rising claims as profits slump by 65pc to €5.5m
The country's second largest health insurance provider, Laya Healthcare, yesterday blamed an increase in the volume and cost of claims as a contributor to pre-tax profits at the company slumping by 65pc to €5.5m in 2016.
Revenues at Laya Healthcare Ltd decreased by 15pc, going from €59.27m to €50m.
The pre-tax profit of €5.5m makes it five consecutive years of profits at Laya, although the profits in 2016 were down €10m on the €15.7m pre-tax profits recorded in 2015.
Last May, Laya announced an average 6pc rise in its policies and this follows an average 5pc hike announced at the end of 2016.
In a company statement yesterday, the firm stated that revenues and profits decreased in 2016, "reflecting a sustained increase in the volume and cost of claims from public and private hospitals, which had a consequential impact on Laya Healthcare's underlying portfolio performance".
The company said that "a significant driver of the increase in public hospital claims is largely attributable to the Public Bed Redesignation Charges".
The company added: "Looking forward, Laya Healthcare is well positioned for continued growth and has grown its membership to now look after 580,000 members, representing a market share of 27pc". The total of 580,000 members compares to 543,000 at the end of 2015.
During 2016, Laya Healthcare increased its market share from 25.6pc to 26pc. It has since increased to 27pc - the largest operator in the market at the end of 2016 was VHI with a market share of 50.1pc
Commenting on the 2016 accounts, the managing director of Laya Healthcare, Dónal Clancy, said tht "2017 looks set to be another solid year with an increase in our membership driven by a well-managed performance across our business".
Laya Healthcare currently employees just over 500 people across its Cork and Dublin offices.
Numbers employed increased from 509 to 522 in 2016 with staff costs increasing from €26.2m to €26.78m.
In 2016, pay - including pension payments - to eight directors totalled €1.2m.