THE VHI, facing competition in the Irish market for the first time, now appears likely to appoint a temporary chief executive on a short-term contract. This would be to allow time to identify a suitable full-time appointee.

A board meeting next week is expected to discuss the issue. It is likely that, unless a suitable candidate for full-time appointment is identified in the meantime, the board will clear the way for a short-term contract. This would be likely to be taken up by a senior accountant or consultant who would then run the firm for a short period - probably for less than a year had identified Mr Denis Doherty, currently chief executive of the Midland Health Board, as a potential chief executive. However, Mr Doherty turned down the post and is to be appointed to new senior management position in the health service. Having examined some other potential candidates, the VHI has not yet identified a suitable person for the job.

While the board would probably prefer to make a full-time appointment, it may now have to go for a short-term contract, as it will not want to leave a vacuum at the top of the organisation for a prolonged period.

The VHI faces competition for the first time, after BUPA got clearance from the Department of Health for its products. The Minister for Health, Mr Noonan, must also decide who to appoint as chairman to replace Mr Noel Hanlon, whose term expires next month.