The Health Insurance Authority published its 2024 report earlier this month and the findings were grim reading for consumers.
The average annual health insurance premium last year cost €1,740 – a jump of €146 on 2023.
Average prices across providers increased by more than 12%, but some plans saw rises of over 25%.
All of the major providers (VHI, Laya, and Irish Life Health) have hiked prices this year, and more increases can be expected.
There was also a previous raft of policy price increases towards the end of last year, meaning that anyone renewing their health insurance soon could have two separate price rises to contend with.
But there are some ways you might be able to get more value for money when taking out or renewing a policy, and there are a few questions you should ask before committing to any plan.
How do I know if I am overpaying?
If you haven’t changed your plan for a long time and if it costs upwards of €2,000, then you’re likely paying more than you need to for health insurance, according to Dermot Goode from Totalhealthcover.ie (a Lockton company).
“If you’ve been on the same plan for five years or more or if you’re paying €2,000 or more per adult for cover then the chances are you’re paying too much, and the longer you have been on that same plan the amount you’re overpaying is probably much higher.
“If you’re paying €2,000 or more, there should be a very clear reason for this. For example, to guarantee a private room, getting a refund rate of 75% on medical expenses, or for certain hip or knee coverage.”
He added that there are significant savings to be made just by updating your cover.
“A lot of people, especially older people, are auto-renewing on the same plan and they’re missing out on savings.
“Some corporate plans for example could offer very similar benefits but at a lower price, and anyone is entitled to access them,” Mr Goode
However, if you do want to access a corporate plan getting the name of it might be tricky.
Though you can call your provider and ask them to go through cheaper plans to yours with similar cover that could make it easier.
Should I pay an excess?
Most plans will have some sort of excess built into the policy. This is essentially the amount you would have to pay per claim for treatment.
Many will shy away from an excess, but Mr Goode said “a small excess is good.
“Some mistake the excess, thinking it’s a payment for every night of a hospital stay, whereas it’s per claim.
“You can easily knock up to 25% or 30% off the cost of plans by taking on an excess, so it could be worth it.”
A small excess is considered €75-€100 per claim, and the data show that younger people tend to be happier to take on an excess, whereas older customers don’t like the idea of assuming more risk.
Mr Goode added that “if you have an ongoing, chronic condition then an excess mightn’t make sense, but it’s worth having the conversation with an adviser, because for most people it’s worth it”.
It’s also worth bearing in mind that you can get tax relief on an excess for a health insurance policy.
What if I don’t want to switch provider?
Switching provider can be a minefield but it’s definitely worth considering if you want to pay less.
And importantly, you don’t necessarily need to switch provider to save money.
“Older customers in particular don’t tend to want to change, but they don’t need to pay more,” Mr Goode said.
“50% of all people who switch get a better value plan with the same company.”
Some may worry that they’ll have new waiting periods for cover if they change provider but that’s not the case.
If you switch you are legally entitled to get full credit for any previous cover, and there will be no break in cover or waiting period for pre-existing conditions.
But before committing to a policy, online or over the phone, you should call your provider and ask some key questions:
– If I renew on the same plan, are you changing any of my benefits?
– My current plan is too expensive, is there anything with similar benefits for less money?
“Also, don’t be afraid to give them your budget when asking these questions,” Mr Goode said.
The Health Insurance Authority site is a good source for anyone looking to do the research themselves, but the advice is to never make a final decision based on just this and always speak to the companies too.
“For older members in particular, get someone – a trusted family member or friend – to help with this,” the health insurance adviser said.
“People here in Ireland don’t tend to engage with the companies properly.”
Is it worth paying a broker or adviser to find the right plan?
There are a load of health insurance advisers around the country, and with the process of finding the appropriate cover becoming increasingly complicated it could be worth paying an expert to do the leg work.
But if you go down this route, it’s worth considering a couple of factors.
How are they paid? Flat fee or commission from providers?
Not all providers pay brokers commission, so if the one you choose works off commission, then you might not be getting a full range of plan options covering all insurance providers.
If you choose an adviser or broker that charges a fee, you should expect to pay anywhere between €70 and €150 for this service.
What if I’ve never had health insurance before?
If you’re under 35, then that’s not a big issue and the advice here is that if you’re thinking of getting health insurance, do it when you’re healthy.
If you don’t and end up with a pre-existing condition, then you could have to wait five years to have cover for that condition.
If you have never had health insurance and decide to get it when you’re 35 or over, then you’ll have to pay what’s known as a ‘lifetime community rating’.
In this case, you will have to pay an extra 2% of the gross cost of your policy for each year above the age of 34 that you didn’t have health insurance.
For example, if you are 45 years old and you have had health insurance since you were 28, you will pay the same amount as someone aged 28 or aged 75 with the same health insurance policy.
However, if you buy health insurance for the first time when you are 45, you will have to pay a lifetime community rating of 22% (11 years x 2%).
This means that you will have to pay €1,220 for a health insurance policy with a gross cost of €1,000.
The lifetime community rating was introduced in 2015 and was brought in to address a mass exodus of younger people from the market.
However, if you have ever had any health insurance cover (even a long time ago) then you might be able to offset some of this cost.
For example, if you were covered as an adult on a parent’s policy for a time, then that could reduce the extra money you would have to pay.
If you have any previous cover, try and dig out the details as it will save you money.
Also, if you’ve recently returned to Ireland after being abroad and take out cover within nine months, you can get insurance with no loading.
Insurance companies are good at working this out for you, and the general advice is if you had previous cover, you’re better off starting with that company because they might have details of that cover already on file.
What’s the minimum I should be spending on health insurance?
Basic cover starts at around €500, but Mr Goode noted that policies at this price point only offer basic cover and are “stripped down”.
“We get a lot of people buying the cheapest plan, thinking they have quality cover, but they don’t. These plans are well priced but are extremely limited in terms of cover,” he said.
Mr Goode added: “Mid-level should be your starting point, if you’re serious about having health cover that will work for you.”
Mid-level probably means spending upwards of €1,000, which for many is a lot, but it reduces the risk of you being underinsured for your healthcare.
What if health insurance is simply too expensive for me?
You shouldn’t cancel any cover without first checking if you can reduce your costs by instead cutting any benefits that aren’t essential.
“If for example a private room isn’t essential to you, then look at the cost of having cover just for semi-private,” Mr Goode said.
“Also ask yourself ‘do you need day-to-day cover?’. Maybe a hospital-only plan will work for you instead.”
And if you’re not near a VHI Swiftcare or a Laya Health and Wellbeing clinic, then maybe cut that benefit from your policy, as you mightn’t use it much anyway.
Meanwhile, Mr Goode said there’s a trend emerging where grandparents are in some cases paying for health insurance for their grandchildren.
“The parents might be tight for money with mortgage payments or the like, so grandparents are paying for this, which is allowed.”
He also pointed out that, generally, there is no charge for new babies to be added to policies until the next renewal “but newborns must be added to the policy – this doesn’t automatically happen. Then the baby is fully covered with no waiting periods for pre-existing conditions”.
Another option for those on a tighter budget could be the HSF health plan (aka the Hospital Saturday Fund).
This is a charity-run scheme that is considerably cheaper than health insurance.
It isn’t a substitute for health insurance but could be useful for covering outpatient expenses, and if you only have around €500 to spend it could work for you and is worth looking into.
