Friday 23 February 2018

Families risk losing €1,000 in renewal of health plans

Charlie Weston Personal Finance Editor

FAMILIES could waste €1,000 on health insurance by allowing their policies to automatically renew over the Christmas period.

Some 400,000 people are due to renew their health cover in the coming weeks, but experts said the Christmas mayhem meant many would renew their existing cover and miss out on the best rates.

There have been 15 separate rises in health insurance premiums since 2011, with premiums shooting up by 20pc in the past year alone.

Health insurance expert Dermot Goode said a typical family renewing their cover at the moment was facing a hike of €575 in premiums for two adults and two children.

But by opting for a different plan from the same provider, savings of more than €1,000 for a year's cover for a family could be made.

Mr Goode, of, said consumers switch off from their finances during the holiday period and fail to react to renewal notices through the letterbox.

"Having spent the previous month trying to control their pre-Christmas spending, people inadvertently accept year-on-year increases of up to 20pc on their health insurances costs."

Mr Goode said this is made worse by the fact that GloHealth, Aviva Health, Laya Healthcare and VHI Healthcare all operate 12-month contracts.

If consumers do not act they are automatically locked back in for another year on the identical and usually more expensive plan.

"Customers only have a relatively short window over the Christmas period to look at the various special offers available.

"But our experience shows that the rate of shopping-around halves at this time of the year."

Mr Goode calculated that a family of two children and two adults on VHI's Health Plus Extra were facing a hike of €559 if renewing now – the cost is now €4,117. But if the family switches to VHI's Teacher's plan, a saving €1,200 is possible.

The same family could opt for GloHealth's Better Plan at a total cost of €1,980.

Laya, which has average premium rises of 12pc coming into effect from January 1, will charge €4,213 from next month for its Essential Plus (No Excess). This plan has gone up by €723 for the family.

A saving of €1,947 could be made by the family opting for Healthwise Plus (No Excess) from the same provider.

Mr Goode said that, typically, members had just 14 days from the renewal date to identify and opt for an alternative plan, either with the same or a competing insurer.

Switching at any other time of the year under these contracts could prove costly as some of the insurers now charge financial penalties if customers try to exit from their contract mid-term.

Irish Independent

Promoted Links

Today's news headlines, directly to your inbox every morning.

Promoted Links

Editor's Choice

Also in Irish News