Health insurance prices fall by 3% as providers pass on stamp duty reductions – The Irish Times
The average cost of health insurance has fallen by 3 per cent in the last quarter.
The price decline came as the Vhi Healthcare, Laya and Irish Life Health passed on reductions in stamp duty following lower-than-anticipated payouts in recent months .
The average price reductions have been outlined in one of two reports from the Health Insurance Authority (HIA) that also found while prices are falling across the board, people over the age of 65 continue to pay over 30 per cent more for cover than younger cohorts.
According to a quarterly report lookng at the state of the market, just over 17,000 people took out a new health insurance policy over the last three months, an increase that takes the numbers with cover to 2.4 million.
Although the number of adults insured has increased by 3 per cent in the last 12 months, the percentage of children insured has been declining since 2019.
The HIA’s annual report found that over the last year, insurers “continued to be proactive in adjusting individual product benefits and prices and added new services and features so that the complexity of the market for consumers remained high”.
The addition of new features will be welcomed by consumers, but the complexity makes it harder for people to assess which policies offer the best value for money leading to many people paying over the odds, something which disproportionately impacts older people.
HIA chairwoman Patricia Byron hailed “a strong demand for health insurance in 2021″ and noted the “trend is continuing as we can see from our latest trend report, despite rises in the cost of living, people still place a high importance on their health insurance cover”.
However, she expressed concern that despite the existence of a community rating that means age is not permitted by law to impact health insurance premiums, the over-65s pay, on average, 34 per cent more than younger groups.
“Where consumers are facing into a winter of cost-of-living increases, we’d urge consumers to avail of the HIA’s consumer support services when considering health renewal premiums,” she said.
According to the report, the premium income earned by the insurers amounts to €2.9 billion per annum with Laya being the only insurer to continue to increase their market share. It currently stands at 27.5 per cent while Vhi and Irish Life retain their share of the market at 48.5 per cent and 20.5 per cent respectively.
“In October 2021 we identified a surplus in the [risk equalisation] scheme and recommended a reduction in the stamp duty charged to insurers that would apply from April 1st,” HIA chief executive Laura Brien said.
She welcomed the passing of cost savings to consumers by insurers through lower premium prices.
Risk equalisation involves transfer payments between health insurers to spread some of the claims cost of the high-risk older and less healthy members among all the private health insurers in the market in proportion to their market share.
This content was originally published here.