Health insurance: Switch often for your financial wellbeing

Sometimes it pays to be promiscuous, never more so than with your health insurance. In fact, if you’ve had the same cover for three years, it’s time to be unfaithful.

Research by the Health Insurance Authority (HIA) finds that just 17 per cent of us are bothered about switching. When it comes to one of our biggest annual expenses, policyholders say "general loyalty" and "perceived value for money" are the reasons why.

"There is this misguided loyalty where people mistakenly believe they are getting something extra by virtue of their length of service," says Dermot Goode of totalhealthcover.ie. Nothing could be further from the truth.

Disloyalty pays

Leaving a long-term love, especially when there is an “in sickness” clause, can seen like a risk. But don’t be cowed. It turns out disloyalty, either to your current plan or your provider, could save you hundreds of euro and may get you better cover too.

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“If you are on the oldest plans like VHI Plan B Options [now called HealthPlus Extra] or the old Plan C [now HealthPlus Choice], people think ‘Well, I must have great cover because I’m paying €2,500’, says Goode. “You are only paying €2,500 because that plan is on the market 30 years, not because it is a Rolls Royce plan, far from it.”

He also questions the value for money in the old Essential Plus plans with Laya, and the Irish Life Level 2 Hospital cover, which now costs over €3,000. He says those willing to explore alternatives can expect savings of €500 to €1,000, without meaningful loss of cover.

If you need a stent, a heart bypass or a hip replacement, once you’ve satisfied the waiting periods with your previous insurer, a new provider can’t turn you down. And you don’t have to keep schtum about what ails you. Unlike car or home insurance for example, your past can’t count against you.

“You will never hear ‘Because you told us you have that condition, we won’t take you on’,” says Goode. “The law is very clear. They must take you on regardless of what pre-existing conditions you have. If you cost your previous insurance company €100,000 last year and it will cost the same this year, they must take you on.”

Those on “nurses” plans and “teachers” plans who think they’ve got a sweet deal should also think again, warns Goode. “They are on good plans, but those plans are on the market more than three years – are they the best-value corporate plans? Not even close.”

Know thyself

Whatever your life stage, before looking for a quote, make a list of what’s important to you. Whether you’re planning to start a family, your joints are crocked or you have a child needing extra support, things like maternity cover, hip replacement or child speech and language therapy will be top of your list. Ask your provider or a broker for policies that match your needs.

A room of one’s own?

If you had to stay in hospital, are you bothered about the room? Semi-private accommodation means sharing with up to four others. Private means a room of your own. If you are a family, not everyone needs to have the same cover. So if herself loves chats and could sleep through the Blitz but himself needs peace, you may save money here.

It’s important to note, however, that while a private or semi-private room is covered by your policy, if such rooms are unavailable, you may end up in a lower level of accommodation. Before spending, ask your insurer what your policy does and does not guarantee. A private room in a public hospital is near-mythical.

Get comfortable with excess

The single most effective way to slash your insurance bill is to take on excess. If you are willing to take on the risk of paying a small part of the cost, choosing a policy with excess can nearly halve your premium in some cases.

Dermot Goode cites Irish Life Health’s Level 2 Hospital Scheme costing €3,388 as an example. If you are willing to take on an excess of €50 per claim, the company’s comparable 4D Health 4 plan at €1,587 is nearly half the price. All for potentially just €50 quid.

Likewise if you move from Laya’s 360 Care plan to the company’s 360 Care Select, you’ll save yourself €220 per adult. There’s an excess of €150 per claim but it only kicks in from the fourth claim onwards. No excess applies to hip and knee replacements in 12 private hospitals.

Providers may not proactively tell you about these savings. So the lesson is, if you are renewing your quote or shopping for a new one, ask about similar plans where taking on a small excess will save big.

Most plans have an excess per claim. So if you spend five nights in a swanky high-tech hospital, you pay, for example, €75 in total – not €75 per night as some mistakenly believe. The young and healthy may feel more comfortable dialling up their excess, happy to bet on fewer claims. For those attending regular procedures however, multiple excesses can add up.

Family planning

In a family, not everyone needs to be on the same plan. In fact, choosing a different plan for adults and kids is likely to provide more appropriate cover at a better price. There is a blizzard of options.

For mum and dad, Dermot Goode recommends the 4D Health 2 scheme from Irish Life. “That’s a superb corporate plan for €1,315 per adult.” He says the discounted child rate on the company’s Benefit Plan at €190 each is a good match for under-18s.

If you want to stick with VHI, Goode says its best deal would be to put the adults on the PMI 35 13 plan at €1,281 per adult with the kids going on the One Plus at €226 per child.

And if your kids aren’t insured, is that so bad? Maybe it is. While the public system will treat them quickly in an emergency, they may have a long and uncomfortable wait for common “elective” procedures not deemed emergencies. Just because grommets and tonsillectomies are not emergencies, that doesn’t mean waiting for them isn’t a pain.

"We've had parents contact us where they have been on a waiting list for months for a tonsillectomy and in that time, the child is continually getting sick with infections", says John Haigney of Lyons Financial Services. "If the child has a policy that gives access to private hospitals, they can bypass that waiting list altogether and they are seen in a matter of weeks as opposed to months."

He recommends Irish Life Health’s Nurture Plan at €190 a year. (To those already on it, that’s a €21 price hike on last year’s premium.) This provides a semi-private room in the majority of public hospitals and in selected private hospitals by accepting €300 excess per claim.

For families with more than one child, Laya probably has the most attractive option, says Goode. Mum and dad on the Simply Connect Plus will cost €1,330 each. By putting your eldest child on this plan too, at a cost €296, all the rest of your brood, even if you’re the Waltons, can go on the Flex 125 Explore for free.

If your child needs extra support, prompt access to outpatient services may be a priority. Public waiting lists for speech and language therapy or counselling services are shamefully long. If your child needs these services, Haigney recommends the Irish Life 4D Health range which has outpatient benefits, though this will increase the cost. For €296, the 4D Health 1 plan offers children €30 back on seven visits to a speech therapist, occupational therapist or dietician.

Goode agrees that where a child has ongoing chronic issues necessitating high spend on practitioners, a corporate plan like Irish Life 4D Health 2 or Laya Connect Plus where you can get up to 50 per cent back will repay multiples versus the extra premium.

In some good news, the Government is drafting a Bill to extend free GP care, currently available to under-sixes, to all children of primary school age. This would be phased in, beginning with children aged six and seven in 2020. So that’s one thing you shouldn’t need covered – assuming, of course that they get re-elected.

Young adults

Of course children don’t stay children for long. Just as college fees and car insurance hit your pocket, expect a spike in the cost of their health insurance too. Look for plans with young adult rates, though the discount may reduce as your offspring reach 25. If you have a child nearing 18, double check his or her policy doesn’t automatically revert to the full adult rate.

A 17 year old on Laya’s Flex 125 Explore scheme costs €375. When the child turns 18, the cost spikes to €1,820, says Goode. He advises moving your child to another plan, like Laya’s Simply Connect at €615 instead.

Hip hop

Older people in particular are far less likely to switch insurer. And the irony is that by switching provider or indeed staying with the same one and switching plan, many people on the old VHI Plans B or C could not just save hundreds but may improve their level of cover too.

“You may not get a plan with Laya or Irish Life that will match that old VHI Plan B option, but if you were to add a small €75 excess – payable per claim, not per night in hospital – you could save up to 50 per cent on your premium,” says Haigney.

By accepting an in-patient excess of €75 per claim in a private hospital, the Irish Life 4D Health 3 plan €1,525.60, is almost €1,000 cheaper than the old VHI Plan B, now called HealthPlus Extra, which costs €2501.92. So the saving balances out the excess.

Those with dodgy knees, hips and shoulders however should note with Irish Life, there is a €2,000 co-payment on certain orthopaedic procedures like joint replacements.

The Blackrock Clinic, however, waives this fee. (That hospital's "cover check" app lets you see exactly what your policy covers.) "We do find that a lot of the hospitals, especially the hospitals based in Dublin, are willing to discuss [fees] with a customer," Haigney says.

Choose wisely

Still having a hard time choosing? Use the Health Insurance Authority’s online comparison tool [at hia.ie] to directly compare plans and prices. A broker specialising in health insurance will know their onions too.

Be sure to check how they are paid – whether it’s an advice fee to you or by commission. Those brokers who are familiar with all providers and who take time to find out about you will find you the best deal.