Health cover for €495 as price war kicks in
'No-frills' plans launched as 500,000 renew insurance
A PRICE war has broken out among health insurers in a desperate bid to stop thousands of young families dumping their cover.
The second largest health insurer in the market has launched 21 new plans, including "no-frills" packages costing under €500 a year for an adult, in response to special offers being offered by rivals.
The new €495 plans offered by Laya undercut the previous cheapest health insurance offerings by €35 per year.
Some half-a-million people are due to renew their health cover by the end of January, the busiest time of the year for renewals.
But thousands of young families are coming under pressure to ditch their policies, especially after changes in October's Budget sent premiums up by between €60 and €500 per adult.
Those renewing will also be hit by price rises announced since they took out their policies last year.
The €495 plans are among 21 launched by Laya in the past few days.
These nine new Advantage "no-frills" plans come with major restrictions. Those taking them out will not be covered in all private hospitals and the cost of some procedures is not fully covered.
Laya has also launched nine Flex Plans that cover private and public hospitals, and three low-priced Assure plans.
Dermot Goode of Healthinsurancesavings.ie said the launch of the 21 new plans was in response to Aviva introducing six cut-price plans in June, with similar restrictions.
Aviva has now cut the prices on some of its plans, and is offering discounts for children.
The Aviva Health Value plan drops in price by €78 for an adult from January 1, to €850. The plan covers public and private hospitals, but there is an excess -- part of the cost of the treatment the patient has to cover themselves -- of €125 for private hospital admissions.
VHI Healthcare is now offering half price for children on a number of its plans -- One Plan Family, Parents & Kids, Parents & Kids Excess, and Nurses Plan Select and Teachers Plan Select.
It has also reduced the prices on some of its most expensive plans for those willing to take on an excess. These include Health Plan Extra (which used to be called B Options), Health Plus Excess (B Excess), Health Plus Choice (Plan C), Health Plus Premium (Plan D) and Health Plus Platinum (Plan E).
New player Glo already offers free cover for children under three. It is now offering half price once these children reach three and the policy is being renewed or a new one is being taken out. Glo is also offering a 8.33pc discount on its Better and Best plans.
Mr Goode warned consumers that health insurers were not telling people about the special offers they have when contact is made with a call centre.
He said consumers needed to do research or consult a broker if they wanted to keep costs down.
"This is an escalation in the level of competition. There are offers from all four insurers and 21 new plans have been launched. That is unprecedented. This is good for consumers, but the downside is that it has become even more complex to find a suitable plan," he said.
Of the new Laya plans, Mr Goode said the Flex 250 Explore was worth considering. It will cost a family of two adults and two children €2,100 a year, and there is a €250 excess payment when making claims.
And Laya has launched a new corporate plan called Essential Connect, which covers public and private hospitals and will cost a family €1,900 a year. There is a one-off €300 excess, which has to be paid once if any family member makes a claim.
The addition of the new plans will take to 275 the number of health policies in the market.
Some 250,000 people have opted out of the health insurance market since the downturn in 2008, with the majority of these young families.
Insurers fear the numbers of young families leaving will pick up, especially given the changes to tax reliefs in the Budget.
Mr Goode said the proliferation of new plans meant people should now be able to find a cheaper plan with similar cover without having to switch provider.
Charlie Weston Personal Finance Editor