VHI to raise prices by 7% on average in further blow to health insurance customers

The State’s largest private health insurer VHI has announced that its prices are to increase by an average of 7 per cent with effect from the beginning October.

It is the second price increase the provider has imposed in 2023.

In March, the company, which has more than 1.1 million subscribers, said it would increase prices by an average of 4.8 per cent across its health insurance plans due to increased demand for healthcare and rising costs.

While the company stressed that the average increase would be 7 per cent certain policies will climb by 9 per cent which will see some people paying hundreds of euro more each year for their health insurance.

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The price hike will put further pressure on households dealing with cost-of-living increases. The second hike in little more than six months means hundreds of thousands of its customers will be facing double digit price hikes amounting to hundreds of euro between now and the end of February.

The company blamed a “continuous increase in the numbers of members accessing healthcare as well as sustained increases in the costs associated with the delivery of healthcare are driving the need for a price increase”.

In a statement, VHI said it had a responsibility to set premiums in a prudent and sustainable manner to ensure that VHI can provide its members with access to excellent healthcare and meet those costs.

Speaking about the increases in premium Aaron Keogh, managing director, VHI Insurance DAC said: “We are conscious of the financial pressures that many of our members are facing, however, the price increase is necessary to ensure that we continue to meet member’s healthcare needs. The pandemic brought significant impacts on healthcare delivery in Ireland but we have seen a strong recovery in the number of members accessing necessary healthcare treatments in all parts of the healthcare system through 2023.

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“As well as a sustained rise in the volume of claims, there have been significant increases in the costs associated with the delivery of healthcare due to upward pressure on wages, energy and other costs. This price increase is necessary to ensure that we continue to meet the healthcare needs of our customers, giving them access to new and innovative drugs, procedures, technologies and services as required to meet their medical needs now and into the future.”

He said the company “exists solely to meet the healthcare needs of our members and all premium income received is used solely for this purpose. Any surplus generated is invested in improving the service experience and healthcare outcomes of our members”.

Responding to the latest increase the Health Insurance Authority (HIA) said it had been given the legally required 30 days notice of the hike.

“The private health insurance market in Ireland gives discretion to health insurers to set the prices for their policies,” the HIA said in a statement. “These prices are ultimately based on the cost of the claims that the insurers receive. If the number of claims or the cost of healthcare increases, prices can also increase.

“Due to medical inflation and an increase in claims volume since the COVID-19 pandemic, insurers have effected a number of price increases this year. This trend is consistent with an emerging global pattern post- COVID.

“We always encourage consumers to review their policy each year at their renewal date to ensure that their policy fits their health needs and budget. Consumers can use the free comparison tool on our website, hia.ie, to find the best policy for their needs.”