Irish Life to pass on levy cut to health insurance customers – Independent.ie

IRISH Life is to pass on a reduction in the State levy on health insurance plans to its customers.

he move could save a family around €100.

It comes as Laya Healthcare is to reduce the cost of five of its plans from April.

Last October the Health Insurance Authority (HIA), the regulator, said it was putting in place a once-off reduction in the levy imposed on health insurance policies.

The levy decrease will mean an annual saving of €43 per adult for most of those with health insurance, according to regulator.

The HIA said it expects the reduction to be passed on directly to consumers, but so far Irish Life is the only health insurer to commit to passing on the cut.

For lower-level plans that only cover public hospital treatments the reduction amounts to €35 per adult.

The annual levy supports the community rating system which allows everyone, regardless of their health status and other risk factors, to buy the same health insurance policy at the same price – known as risk equalisation.

The HIA said the reduction is a result of a surplus in the Risk Equalisation Fund due to lower claims during the Covid pandemic.

Irish Life Health said customers will receive the benefit of a reduction in the levy on their plans for 12 months from their renewal date. The reduction will come into effect from April 1 next.

Managing director of Irish Life Health Gerard Davis claimed further reductions in the levy, and ultimately customer premiums, are achievable if the Health Insurance Authority and the Department of Health implement changes in the risk equalisation scheme that Irish Life Health has recommended.

He said this would ensure greater fairness between customers of all health insurers.

Dermot Goode of TotalHealthCover.ie said the passing on of the levy cut would save a family of two adults and two children between €92 and €116.

But he said this comes against the background of price rises of between 2pc and 5pc from all three providers last year.

“For those renewing on April 1, they will benefit immediately from these savings but for those who have just renewed in January or February, or those renewing in March, they will have to wait until 2023 before they will benefit from this reduction,” Mr Goode said.

Separately, Laya Healthcare is reducing the cost of five of its plans from April.

The Assure Protect scheme will reduce by €38 to €1,314 for a family of two adults and two children.

The Signify plan, which covers public and private hospitals, will reduce by €86 for the same family reducing its total cost to €2,376.

Laya is also expanding its free cover for the second and subsequent children under 18 from April.

This offer will now be available on six Laya plans.

Vhi has not announced any changes from April, but Mr Goode said he is expecting some movement on its rates to be announced shortly after this.

The broker warned: “Consumers need to be careful not to be misled by these changes.”

He said that rate reductions are welcome, but medical inflation is still high which means year-on-year they should expect premiums to continue to increase just as they did last year.