‘Skipping queues’ is key benefit of health insurance

“Skipping queues” and getting better access to services, are two of the main reasons people fork out upwards of €600 a year for private health insurance a new survey has found.

According to consumer research conducted by Millward-Brown for the Health Insurance Authority (HIA), six in ten people who pay for private health insurance (PHI) do so to "skip queues", while one in two say that "PHI is a necessity, not a luxury" .

The high cost of medical treatment and accomodation, as well as better access to services are other factors cited in a report published on Tuesday.

Health Insurance Authority chief executive Don Gallagher, said that the survey shows that those with PHI "place a lot of value on their cover perceiving that it provides them with better access to healthcare services, and with a majority of 75 per cent perceiving PHI as a necessity and not a luxury."

The survey also points to a growing acceptance among people that the cost of health insurance must rise, with a sharp decrease in the proportion who feel that premium increases are inappropriate. The survey was based on a nationally representative sample of 1,832 face-to-face interviews conducted in late 2015.

PHI coverage

HIA data shows that 45.8 per cent of the population had PHI cover in December 2015, and the survey shows a greater number of people living in Dublin and Munster (both 28%) have relinquished their PHI in recent years due to financial forces than in the rest of Lenister (26%) and Connacht/Ulster (18%). Moreover, 15 per cent in the 65+ age group used to have PHI but have since give it up, up from 11 per cent in 2013.

VHI’s share of the market has dropped slightly according to the consumer research (six percentage points since 2013) with a portion of its market share taken by Laya (formerly Quinn) and GloHealth.

But VHI continues to have a large proportion of the oldest health insurance customers, with 60 per cent of those respnding in the over 65 category, compared with just 4 per cent at new arrival GloHealth and 14 per cent at Laya.

Switching

Given the rapid rise in the cost of health insurance in recent years, it would come as no surprise to learn that consumers frequently switch between providers to get the best deals.

However, this is not the case, with the insight into consumer behaviour showing that just one in four (24%) have switched their PHI provider at some stage in the past, although this does represent a four percentage point increase since 2013.

Of those who have switched, over a quarter (27%) have switched more than once, while more than half (58%) have switched away from Vhi, with one in six (17%) moving from Laya, and one in five switching from Aviva.

The main reason for switching is cost (65% citing this to be the case) and secondly, improved levels of cover (23%).

Moreover, just one in five of those with health insurance say they regularly “shop around” for the best deal, with respondents citing “too much hassle/paper work” and “couldn’t be bothered” as two of the reasons for not doing so.