Wednesday 22 May 2019

Families 'paying €1,000 too much for health cover' amid costly errors

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Charlie Weston

Charlie Weston

Families are overpaying for health insurance by up to €1,000 a year with many paying full adult rates for young people.

Some individuals are paying more than €500 extra for their own cover.

TotalHealthCover.ie compiled research based on a sample of 1,500 consumers to find out just how families were getting stung on cost.

According to Dermot Goode, of TotalHealthCover.ie, a failure to take on an excess, fear of switching, and not taking out non-adult rates for young family members are among the errors that are costing households. He also singled out a failure to shop around, and instead to auto-renew cover, as a costly error.

"Too many people auto-renew their cover which means they have no chance of securing better deals at a lower cost," Mr Goode said.

He said this behaviour, or inertia, could be costing people hundreds of euro on their cover.

Of those who do look to shop around, many leave it too late and only seek advice after their renewal date has passed.

They are then shocked to find they are locked into the same "dated" contract for another 12 months.

"For policyholders on the same plan for three years or more and/or those who are afraid to switch insurer, the average savings are in the region of €500 per adult or more depending on the plan."

Taking on an excess, which is the amount the consumer has to pay first when they make a claim, is the single best way of reducing the cost of cover.

The excesses can range from €50 to €150 per claim. Mr Goode said many people wrongly believe the excess applies per night of stay in hospital.

A fear of switching health insurers is one of the biggest stumbling blocks for consumers and is more prevalent among older members.

"People don't realise that they get full credit for previous membership which means no re-serving of waiting periods or age loadings to worry about. If they switch from renewal, there will be no break in cover whatsoever," he said.

"If they switch to an equivalent plan, they will be on cover immediately for any existing medical conditions."

Not taking up discounted young adult rates for those aged 18 to 25 is another drain on family budgets.

Young adults are entitled to these discounts but only if they are on the correct plan. This applies whether they are working or in college.

A failure to take up corporate plans is also proving costly.

Many consumers still believe they are not entitled to join these corporate plans. These schemes are open to every consumer irrespective of the plan name or target market.

They tend to offer the best overall benefits, including guaranteed refunds on out-patient expenses with no excess to pay first.

Mr Goode advised caution for consumers relying on comparison sites when trying to select the most suitable plan to match their requirements. Consumers should engage a qualified adviser, he said.

Irish Independent

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