Now Laya tries to halt exodus with cut-price health plans
A HEALTH insurance price war has broken out after another company said it, too, is to launch a range of cut-price medical plans.
Laya Healthcare, the second-largest health insurer in the market, will reveal new low-cost plans within days as it seeks to stem the flow of young people exiting the market.
This comes as Aviva said it was introducing no-frills plans.
And VHI Healthcare has already indicated that it is ready to bring out a new range of policies that will cover fewer hospitals, but be much cheaper than existing policies.
The new policies offer a chance for many cash-strapped consumers to continue to hold on to medical cover after five years of rapid price rises.
But the cut-price plans will come at a cost in terms of the number of hospitals covered. Some procedures will also require extra payment from the patient.
Laya has around half-a-million customers. Chief executive Donal Clancy said: "Laya Healthcare is delighted to confirm that it will shortly be announcing details of new schemes that will offer members excellent value and cover in selected public hospitals."
Aviva launched six new plans mainly aimed at younger families that had been forced to drop out of the market due to escalating premiums.
Some of the plans are up to €700 a year less expensive for a family of two adults and two children, at €1,800 a year.
Aviva's new plans will cover both private and public hospitals, although not every hospital will be covered, and consumers will have to partly pay for some procedures. The main plan is as much as 20pc cheaper than similar ones.
The move will herald a huge shake-up in the market as insurers refine their plans to ensure they can offer better value.
Laya said yesterday it would now launch plans that covered selected public hospitals.
Dermot Goode, of Healthinsurancesavings.ie, said Aviva had prompted a shake-up of the market, with new plans as low as €750 for an adult. "The others do not want to compete at that level but they are going to have to," he said.
Some 200,000 people have dropped their health insurance cover in the past five years.
The new, cheaper policies would see customers having fewer choices about the number of public and private hospitals they can use.