VHI HAS ANNOUNCED it will increase the average price of its health insurance plans by 3.5% from 1 October.

The health insurance company said the move is in “response to the sustained increase in both the volume and costs of healthcare claims”.

Laya Healthcare announced last week that it too will increase the cost of its packages by an average of 6.5% from October.

Vhi said that in the first half of this year, it has seen a 14% increase in private hospital claim costs when compared to 2023.

It added that the “costs associated with the delivery of healthcare are rising, driven primarily by the increased costs in private hospitals and associated healthcare professional costs”.

Vhi further remarked that the cost of “day-to-day claims” have also “increased significantly”.

The insurer added that in an effort to “somewhat mitigate the price increase announced today for some families”, it is reducing the cost of some children’s premiums by 25% from October.

Day to day benefits, such as GP visits and physiotherapy, has also been added to some plans that previously didn’t have access to this.

Aaron Keogh, managing director of Vhi Insurance, said the company had taken the decision to introduce prices as “premium income has not kept pace with healthcare demand and associated claims costs”.

He said Vhi has to “price prudently for the future so that we remain in a position to meet the healthcare needs of our members”.

He remarked that the company “understands the affordability challenges that many people are facing” and added that Vhi is “determined to continue to deliver value for money”. 

Keogh further remarked that Vhi reported financial losses last year and that there has been “accelerated growth in healthcare claims volumes and as a result unprecedented increases in healthcare claims costs”.

He said this was a result of members “accessing more healthcare than ever before in a variety of settings”.

Meanwhile, the Health Insurance Authority (HIA) noted that customers will be informed of any changes to their plan, including any price or benefit changes, in their renewal letter.

The role of the HIA is to ensure consumers are aware of their rights and insurers meet their responsibilities in relation to health insurance.

The HIA said that while price increases “may have an impact on some consumers, the health insurance market in Ireland is an open market, and insurance providers can make price changes as they see fit”.

It added that prices are based on the cost of claims that the insurers receive and also noted that there have been a number of health insurance price increases across the market in the past 12 months due to medical inflation and an increase in claims.

According to its latest Annual Market Report, the total level of claims paid by insurers in 2023 rose by 15% on the previous year, and there was a slight increase in claims for private hospitals.

The HIA encouraged 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 and noted that its helpline is open to provide information about health insurance.

The HIA noted that for Vhi Healthcare customers, the price changes will impact on those who renew policies on or after 1 October.

If you are mid-contract, the HIA said the cost of the health insurance won’t change on 1 October and that the public can use the HIA’s free comparison tool to compare plans.