VHI to raise prices of health insurance plans, adding up to €250 to the annual cost for a family of four

State owned insurer Vhi is increasing the cost of its premiums.

Charlie Weston Twitter Email

January 26 2023 03:04 PM

Customers of Vhi Healthcare are to be hit with a premium price rise from the start of March.

The increase is an average of 4.8pc across its plans. For those renewing from March the annual costs, for a family of two adults and two children, will be between €60 and €250 more a year.

It comes after Irish Life Health increased its prices at the start of this month.

These moves mark a turnaround after both Vhi and Laya had stalled price rises and instead had paid rebates as private healthcare facilities saw a fall-off in use during the lockdowns.

Vhi blamed increased demand for healthcare and the rising costs of providing healthcare to customers.

The price increase is necessary to ensure that Vhi can continue to meet the costs of providing healthcare to its customers in 2023 and beyond, the insurer said.

This is the first price increase in two years, following a price reduction in 2022 and the return of €450m in premium waivers to customers over the past three years.

Health insurance broker Dermot Goode of TotalHealthCover.ie said the 4.8pc average rise in the costs of plans masks that fact that some plans are going up by 6.5pc.

He said two adults on Health Plus Extra, or the old Plan B Options, will face paying an extra €267 a year if they stay on this plan.

Mr Goode said the good news was that most people will have renewed by now for another year so may miss these rises for this year.

Laya Healthcare is now expected to announce a similar price rise.

Mr Goode said: “People do not have to accept these rises. They should get on the phone if they are renewing and shop around.”

Vhi said the cost of meeting customers’ healthcare needs has increased significantly in the last year as demand for healthcare services returns to pre-pandemic levels.

This trend also reflects pent-up demand for healthcare services resulting from periods of reduced access to services over the last two years.

The state-owned insurer said there has been a significant increase in the costs associated with the delivery of healthcare due to increases in wage, energy and other costs including infection control. Many of these supply cost pressures are amplified by world events, impacting all sectors and industries.

Vhi managing director Aaron Keogh said: “We understand that our customers are already dealing with the pressure of rising costs across the economy and we have made every effort to keep the price increase as low as possible.

“However, because of these cost pressures, the price increase is necessary.”

Before Christmas, Irish Life Health increased the cost of its plans for those renewing or taking out a new plan from the start of January.

The hikes mean the cost of health cover will rise by between €80 a year and €170 for a family of two adults and two children.

It comes during a cost-of-living crisis that is expected to cost the average family around €3,000 a year due to inflation in the cost of energy, motor fuel and food.