Vhi, the largest provider of private health insurance in the State, is set to increase its premiums by an average of 7% from March 1.
The company said the price increase is necessary to meet the healthcare needs of members as claims volumes rose by more than 20% last year and inflation has had a significant impact on the cost of delivering healthcare.
It noted that increased demand for healthcare combined with high levels of inflation are impacting healthcare systems around the world as healthcare facilities reopen fully after the Covid pandemic.
Vhi raised its prices twice last year - in March and then again in October. The company had reduced prices by 3% in 2022.
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Aaron Keogh, Managing Director at Vhi Insurance, said 2023 was an extraordinary year, marked by an accelerated growth in healthcare claims volumes stemming mainly from Covid related issues.
He was this was driving an unprecedented increase in healthcare claims costs and claim volumes in 2023 increased by more than 20% compared to 2022.
"This unprecedented demand for healthcare from our members has led to a rapid increase in claims volumes and associated costs. We are taking the difficult steps required to address this matter," Mr Keogh said.
"We have implemented a broad range of value and efficiency measures within the business as part of these efforts, however, the scale of the increase in healthcare services accessed by our members means that this price increase is necessary," he said.
"We are conscious of the financial pressures facing many of our members and are committed to delivering value by giving them access to high quality healthcare at the lowest possible prices," he added.
Dermot Goode of Lockton, parent company to Totalhealthcover.ie, said this latest rate hike from Vhi will add €105 per adult for those insured on its Enhanced Care 350 scheme or between €230 and €315 per adult for those insured on the Health Plus Extra and Premium Care schemes.
"For a retired couple on dated plans such as Health Plus Extra (old Plan B Options), the increase since March 2023 will cost them just under €900. For the same couple insured on the Premium Care scheme, they will have to find an additional €1,386 if they want to remain on the same plan," he stated.
He also said that a typical family of two adults and two children will be seriously impacted by these increases.
"For those families insured on the likes of One Plus Plan or Enhanced Care 350, the total increase since March 2023 will be €504 and €440 respectively. The popular Company Plan Plus Level 1.3 corporate plan will increase by €586 or 18%," he added.
Mr Goode advised all those renewing on or after March 1 to urgently review their options with Vhi. "The best advice is to decide on your budget for your family health cover and then challenge the insurers to find you similar cover that fits this. Auto-renewing without checking our alternative options should be avoided at all costs," he added.
He said that Vhi's latest increase comes on the back of the 4.8% average announced by Irish Life Health from January 1. Laya and Vhi also increased the cost of about 26 of their corporate plans from the same date.
"This cycle of multiple price hikes looks set to continue 2024 as the insurers seem unable to predict with any certainty their future cost of claims. If we look at the 2023 trend, Laya increased their rates from April 2023 just after VHI increased their charges and we're expecting something similar in 2024," he added.
