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Health Committee

Health insurance bosses stress the need to attract young people to the market

Speaking before the Oireachtas committee today, one stressed that proposed legislation won’t cause an increase in premiums.

Updated at 12.53

THE HEADS OF Ireland’s main health insurance companies have stressed the need to attract more younger people into market to avoid an increase to the cost of insurance.

The heads of VHI, Glo Health, Laya Healthcare, and Aviva Health Insurance Ireland appeared before the Oireachtas Health Committee this afternoon to discuss measures proposed by government in Budget 2014.

These include an increased health insurance levy which could result in a hike in insurance premiums by as much as 15 per cent, it has been warned.

‘Cost spread out’

They echoed each other’s calls for the government to attract more young people into the health insurance market, as without them the cost of the older and sicker can not be spread out using the younger and healthier clients’ premiums.

Laya Healthcare’s Donal Clancy said that the market has “gone into shock”, and that the government is “has forced young healthy people out of the market”.

VHI Chairman John O’Dwyer said that all health insurance companies “support the government’s policy of community rating, and the plan to protect it”.


Health insurances bosses before the committee today. (Image Credit:

He also said that the measures announced in the legislation are “cost neutral”.

It merely moves the money around the system, from young and healthy customers to sick and older customers. Contrary to what has been said, it does not cause price increases.

“If insurers balance their books with a mixed profile of customers, the credits collected and levies paid would balance each other out”, he said.

However, Brian Dunne of Aviva Healthcare criticised the government’s cap at which tax relief  can apply on premiums to €1000 for an adult and €500 for a child.

People were now paying on average €100 more as a result, he said, and combined with a government move earlier this year to charge private patients for public hospital beds it placed an extra “€300 million on 1.2 million people”.

O’Dwyer also called for a “standard product with a fully effective risk equalisation system” as a precursor to a universal healthcare system.

Risk equalisation is essential. Without it, the market would collapse.

Donal Clancy also echoed the need to reform the risk equalisation system.

Jim Dowdall of Glo Health called for the health insurance levy to be cut, as it would attracted lapsed policy holders back in to the system.


Jim Dowdall, CEO of Glo Health (Image Credit:

He also called for the lifetime community rating system to be introduced, someone which has not been introduced in Ireland despite it being on the statute books since 2001.

This would result in higher charges for those taking out insurance later in life, with cheaper premiums for those who take it out at a young age.

Originally published 12.29

Read: Health insurance levy will cost customers “up to 15 per cent” >

Column: Why we need to deliver an Irish version of the NHS >

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