Business Personal Finance

Wednesday 22 November 2017

Health insurance exodus continues as premiums soar

Medical insurance
Medical insurance

Charlie Weston Personal Finance Editor

MORE than a quarter of a million people have ditched their health insurance policies as spiralling premiums and repeated hits to household income caused an exodus from the market.

In the three summer months alone, a total of 11,000 people gave up paying for health insurance.

New figures from the regulator for the private medical insurance market, the Health Insurance Authority, show that the numbers leaving the market continue to climb.

There were 2.3 million people with the insurance when the market peaked in 2008, just as the financial crash hit the economy. Since then, the number with cover has fallen sharply to just over 2 million people. This is a fall of 250,000.

In the nine months to September this year, there was a total of 62,000 people opting to stop paying for health insurance. Now, 44pc of the population has health insurance, down from 50pc in 2008, according to the Health Insurance Authority. Most of those giving up their cover are the under 50s, while those over the age of 60 have been joining the market.

This makes it more expensive to provide cover, as older people tend to make more claims.

Some of the most popular plans have tripled in price since 2008. The old Plan B from the VHI, which is now called Healthplus Access was €613 per adult in 2007.


It now costs €1,705, a rise of 180pc in the six-year period.

Insurance expert Dermot Goode said more people would leave the market in the coming months, with 100,000 forced to stop paying for private medical cover next year.

He predicted the overall number with policies would dip below 2 million by March, and at least two of the 17 private hospitals would be forced to close. Householders with insurance have been hit with a triple whammy of rises this year. These include:

* A reduction in the tax reliefs on polices. This has seen adult premiums jump by between €40 and €800 a year.

* Price rises have already been announced by Aviva and GloHealth, with more expected. These are on top of rises from all four insurers earlier in the year

* The levy on policies is due to rise again in March, costing an extra €49 for adults.

He said consumers would also be hit next year by Health Minister James Reilly's decision to impose costs of €130m on the four health insurers for using public beds in public hospitals.

All insurers would now impose cumulative rises of up to 20pc in the coming weeks, Mr Goode of said.

Price rises imposed by health insurers and severe cuts to the tax reliefs in the Budget could see families being asked to shell out an extra €2,000 to insure two adults and two children, Mr Goode said.

Irish Independent

Promoted Links

Promoted Links

Business Newsletter

Read the leading stories from the world of Business.

Also in Business