Charlie Weston: It looks like consumers are finally being cut some slack
After years of being overcharged for mortgages and health insurance, there are finally signs that consumers are catching a break. For a long time it seems as if health insurance premiums were perpetually going up, with multiple being announced year-in year-out.
The rot stopped this time last year when Vhi threw down the gauntlet with the first in a series of price cuts. The largest player in the market is benefiting from lower levels of claims and wanted to cut its premiums to retain customers.
Rivals Laya Healthcare and Irish Life Health were forced to respond with cuts of their own to ensure they remained competitive. Although there has also being some premium price rising as well. But overall, the consumer has won from the price war that has broken out.
Now, instead of seemingly relentless price rises, we are seeing reductions.
Irish Life Health is reducing the price on a number of plans that will save typical families up to €270 a year.
The decreases are in corporate plans, which are considered the best value. Savvy consumers have long known that corporate plans are the smartest purchase. But consumers would be well advised not to get sucked into staying on the same plan just because the price has been cut. Check out all the plans and don't just auto-renew because the price has come down on your dated plan.
When it comes to mortgages, overcharging has been rife in the market for years. But here too there are signs that matters are improving.
Interest rates have been steadily coming down, even if we are still a long way from Continental rates. A typical new buyer is paying €157 more for their mortgage a month compared with the eurozone average.
The news that non-bank lender Finance Ireland is set to become a player in the mortgage market should shake up the scene even further.
The cosy control of the home-loan market, mainly by AIB and Bank of Ireland, will be eroded by this. It comes as An Post plans to enter the mortgage market next year, with credit unions ramping up their mortgage offering.
Suddenly, consumers are seeing some real competition entering the mortgage and health insurance markets after being gouged for years.