Vhi Healthcare is set to increase the price of its health insurance plans by an average of 3.5% from the start of October.
It said the hike was needed due to the sustained increase in both the volume and costs of healthcare claims.
In March, it increased its premiums by an average of 7% .
The insurer said it has seen a 14% rise in private hospital claim costs in the first six months of the year when compared to the same time last year.
It said the costs associated with delivering healthcare are rising, driven mainly by the increased costs in private hospitals and associated healthcare professional costs.
It added that the cost of day-to-day claims have also increased significantly.
On a more positive note, Vhi announced that it is reducing the cost of children's premiums on selected plans by 25% from 1 October .
It also said day-to-day benefits have been added to some plans that previously didn't have this benefit.
"We have taken the decision to introduce a price increase from 1 October as premium income has not kept pace with healthcare demand and associated claims costs," said Aaron Keogh, Managing Director of Vhi.
"We have to price prudently for the future so that we remain in a position to meet the healthcare needs of our members.
"We understand the affordability challenges that many people are facing and the importance that is placed on retaining health insurance and we are determined to continue to deliver value for money," he added.
Mr Keogh pointed out that Vhi reported financial losses last year, due to what he described as a "challenging" environment.
"2023 and 2024 have seen accelerated growth in healthcare claims volumes and as a result unprecedented increases in healthcare claims costs," he said.
"This is because our members are accessing more healthcare than ever before in a variety of settings," he added.
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Vhi is the largest health insurer in the market with 1.2m customers.
Last week, Laya Healthcare announced that it will hike its premiums by an average of 6.5% for its 700,000 customers from the start of October.
The Health Insurance Authority (HIA) said the total cost of claims paid by insurers last year rose by 15% on the previous year.
It said that consumers are free to move to any plan on the market at their renewal date, and it encourages everyone with health insurance to review their policy each year to make sure that they are on the right plan for their current lifestyle and health needs.
The HIA said its helpline is available and it can to provide information about health insurance, answer questions and give information to help consumers find a health insurance plan that fits their budget.
Head of the healthcare division at Lockton Insurance Brokers Dermot Goode said the increase could add anything from €50 on a mid level scheme such as One Plus Plan to €260 on the top VHI scheme which is Premium Care.
"Whilst the typical cost for a family of 2 adults and 2 children could increase by up to €150 on a mid level plan, it's important to note that Vhi will be reducing the cost of child cover on many of their plans from 1st October which means that this latest increase may have a minimal impact on families depending on the plan held," he added.
He added that consumers need to be wary of the averaging of figures.
"The average being quoted by Vhi is 3.5% but some of their older plans such as Advanced Care Extra Day-to-Day and Premium Care will increase by approximately 5%," he said.
Mr Goode said further increases this year cannot be ruled out as all health insurers continue to grapple with the spiralling cost of medical inflation.
Additional reporting Fergal Bowers & Will Goodbody
