Q&A

How much did VHI Healthcare increase its premiums by?Premiums will go up by between 15 per cent and 45 per cent from the beginning of next month.

Those on Plan B and Plan B Options will be the hardest hit and are set to face increases of as much as €444 a year.

These price hikes will come on top of tax changes which were announced in last month’s Budget and so could scarcely have come at a worse time for consumers.

How does the company justify these price hikes?

The VHI maintains it is a not-for-profit organisation and points out that 96 per cent of all the money it raised in premiums last year was spent on providing healthcare for its members.

It says it has no choice but to impose the increase because it has a much older customer base than its two competitors, Quinn Healthcare and Hibernian Aviva. It has more than 200,000 customers over the age of 60 and they make significantly more claims than younger people. According to the company, an average person in their 80s will spend 15 times more on healthcare than a person in their 20s .

Do the price increases announced yesterday have to be sanctioned by the Government?

No, the VHI does not have to seek any State approval before rolling out the price increases.

Is there any way I can avoid paying higher premiums?

Yes. If you renew your annual policy at any point between now and February 1st – and anyone can do this, irrespective of when their policy comes up for renewal – then you will be locked in at the lower price for a further 12 months.

This can make a big difference to people.

A single person on Plan B will save themselves over €330 this year if they act now. The VHI is selling its Family One+ policy at a discount, and cover for two adults and two children costs €1,500. The same policy will cost over €2,000 from February 1st.

Are there any other ways to reduce the costs?

Yes. Another simple move which may help you to cut your VHI bills immediately is a switch to a corporate plan.

While the price increases announced yesterday will impact on individual holders of policies, no price increases were announced for corporate policies. But, and this is a very important point, all corporate plans are open to all customers, irrespective of whether or not they are part of a company.

An individual who wants to save themselves money should contact VHI Healthcare as soon as possible and ask if there is a corporate plan which is the same or similar to your existing policy and then switch to it. By doing so now, you should be able to reduce your costs significantly, although it is worth remembering that there is not a corporate equivalent available for all policies.

At least 50,000 of the 200,000 people on corporate plans with the VHI now are private individuals.

Is there anything else I can do?

Shopping around is the next best thing if you want to pay less.

While the health insurance market can be hideously complicated and people are, understandably, afraid of switching to a policy which might subsequently turn out to be unsuitable for their needs, the Health Insurance Authority has made it much easier to compare policies.

The policy comparison tool on the hia.ie website allows people to input their basic details and their health insurance requirements. Then it provides clear and unambiguous comparisons of the various policy offerings from the three main providers operating in the State.

Is it difficult to switch?

No, not at all. All you need to do is set yourself up with a new provider and then write to your existing provider asking them to discontinue your policy.

Can I be turned down by another provider on the basis of my age or a pre-existing condition?

Under the State’s “open enrolment” policy, insurers cannot refuse cover for anyone under 65, irrespective of their risk status, except in some extremely rare circumstances. If you are over 65, you can also switch without any difficulty as long as you are insured in the 13 weeks leading up to the switch.

Once you have an existing policy you can switch to another provider offering a similar level of cover at any time, regardless of your age. This right is lost if somehow your policy is allowed to lapse for more than 13 weeks.

If I switch to a different provider, will there be any waiting period before I am fully covered?

If you switch to a policy offering the same benefits (or a lower level), there is no waiting period. If a new policy has additional benefits, the new company can insist on a waiting period before you are eligible for these benefits only – other benefits will apply immediately.

The maximum limit on this new waiting period is two years if you are under 65 and five years if you are over 65.

The maximum waiting period depends not just on your age but on whether or not you already have a particular medical condition when you start the waiting period. Waiting periods can also be specified for maternity benefits.

If I switch and then want to go back to the VHI, will that be a problem?

No, If you move from one insurer to another and subsequently decide you want to return to the VHI, you can do so without any penalty or waiting periods being imposed.

An insurer can only impose a waiting period if your new plan has any extra benefits available.