Insure you shop around
IT HAS been three months since GloHealth arrived on the health insurance scene but, while a new entrant is always welcome, it is unlikely to offer besieged consumers much relief in the face of soaring costs.
Where once consumers looked to shop around to upgrade their cover or avail of better benefits, now it’s all about saving money where possible.
“Ninety-nine per cent of people, when they get their renewal notices, they try to shop around. No one is increasing their cover,” says Dermot Goode of healthinsurancesavings.ie, adding that people ask him to cancel their cover all the time.
It’s not surprising given that consumers have had to stomach 12 price increases since September 2011, which have seen costs rise by about 20-30 per cent.
And more are on the way, with a raft of additional price hikes this month. Laya Healthcare’s Essential Select plan will increase from €715.58 to €779 per adult, while its Essential Connect plan will rise from €740 to €806 per adult. Aviva increased the price on all its plans by between 4-7 per cent on October 15th, while VHI pushed up the price on a range of plans, including its PMI 28 12 plan.
At the same time, speculation that premiums might rise by a further €200 due to an increase in the health insurance levy is a cause for concern.
Already the levy – which stands at €285 on an adult’s policy, and €95 for a child – has risen by 54 per cent since it was first introduced in 2010.
The projected increase arises because, from January, a new permanent risk-equalisation scheme will come into place.
This scheme, which is aimed at ensuring equitable prices for both young and old, will put upward pressure on prices, but it’s still unclear exactly how much prices are likely to rise by.
For many consumers, additional increases may mean that they will no longer be able to afford private health cover, and will have to join the many thousands of others who have cancelled their cover since the recession first bit.
But this means relying on the already over-burdened public system. So is there anything consumers can do? Well, the first thing is to consider the new competitor.
While Patrick Brennan, director of irishhealthinsurance.ie, asserts that he has seen “no evidence” of the price war that was mooted upon its arrival, he nonetheless sees GloHealth as a welcome development.
“It is providing cover at more affordable levels,” he says.
One of the advantages of GloHealth is that policy holders don’t have to pay for children under three, while in the mid-tier price range, GloHealth’s Better Plan offers many of the same benefits as those from other insurers such as private hospital cover – but is about €100 cheaper at €795.
And GloHealth’s entry-level basic plan, which costs €525, compares well when it comes to the excess for outpatient fees, with an excess for a family of just €200, compared with €200 per member under Aviva’s similar plan, and €250 per person with VHI.
However, what might be incorporated into other plans, must be paid for with GloHealth. It offers eight add-on personalised packages which can be bought for €50 per adult, and €25 per child under its basic plan.
So, for example, if you pay for the “enhanced maternity” package, you will get a range of benefits including a €4,000 grant towards the cost of hospital accommodation, and €30 towards an early pregnancy scan. Elsewhere, shopping around remains critical.
“Complacency will cost you money,” says Goode. However, given the vast range of products on offer – more than 200 – it’s easier said than done, and the problem is that making like-for-like comparisons is pretty much impossible.
In this regard, the Health Insurance Authority’s comparison website, hia.ie, offers a useful tool, even if it can throw up too many options.
“Most insurance companies probably have what you’re looking for and will be able to save you money, but finding that particular plan is the difficulty,” adds Brennan.
If there are savings to be made, it might be on the corporate side – and luckily for consumers, insurers have to make available all their policies to everyone.
They just won’t package them up as consumer friendly products, but they still might meet all your requirements – and for a lower price.
Goode for example, compares Laya Healthcare’s Essential Plus (no excess) product, which costs more than €1,400, with its Healthwise Plus (no excess) plan, which is a lot cheaper at €878.21. He says they are “virtually identical”.
He says VHI’s PMI 28 12 plan offers good value.
Another way to save money can be to spend a little first. By hiring the services of a specialist adviser – which Brennan notes should cost no more than about €100 – they might find you a cheaper plan which better suits your needs.
After all, it’s not just about finding the lower price. If you do decide to switch plans or downgrade, be aware that you may no longer receive cover for “restricted illnesses”.
Almost all of the insurers now require you to pay a portion of the bill when you get treated for certain illnesses in private hospitals.
With VHI, it will cost you 20 per cent of the total bill, while Aviva will ask you to pay up to €2,000.
So, if you have particular concerns, such as cardiac or orthopaedic issues, then check your cover before you switch policies.