Vhi enjoyed bumper profits of €56.4 million in 2016
STATE-owned health insurer Vhi made bumper profits last year.
The company said its net surplus was €56.4m for 2016.
This was almost €11m more in profits that the previous year. The company was also able to boost its financial reserves.
It comes after a two price rises for its more than one million members in the past six months.
The company has also benefited from a rise in the health insurance levy, which funds insurers with older customers.
Vhi has the lion’s share of older customers. The levy ensures older people do not have to pay more for the same level cover as younger people.
However, Vhi’s premium hikes are lower than its competitors.
Total claims paid out in 2016 amounted to €1.34bn, down slightly from the previous year.
Chief executive John O’Dwyer hailed the financial performance and said Vhi was committed to delivering affordable healthcare.
But he warned of troubles in future.
“By 2046, the population of those over 80 years old will increase dramatically to 470,000.
“This has major implications not only for the healthcare system as a whole, but also for Vhi, which is Ireland’s largest provider of private health insurance services.
“With more people living longer and with complex chronic diseases it is clear that the market and those providing services within that market need to change and adapt,” he said.
Health insurance expert Dermot Goode said there was a need for the Vhi to explain why it was hiking its premiums when its claims costs fell slightly last year.
“We need more details from the Vhi on why it increased rates twice in the last six months when claims costs have gone down,” Mr Goode, of TotalHealthCover.ie, said.
The cumulative rises for families have been between 6pc and 10pc in the last year, he said.