Creatures of Habit
We all make subconscious decisions constantly throughout our life about purchasing different products and services. Did you know that Mary my neighbour told me that her family have been a loyal customer of their health care provider for years? I asked her why? And she replied by telling me that her parents were also with them so why would I change? I then told her what if I was to say to you that the price of petrol has gone up 20 cent per litre in the petrol station she uses. You can be sure she will drive 2km down the road to the next service station to get the price she always pays.
As consumers we are sometimes afraid to change the product or service, or the unknown of what may happen if we switch. Economist call this a cost benefit analysis. This is especially true for Health insurance, as VHI held a monopoly in the health insurance market in Ireland until 1996, when BUPA entered the market.
The Price is right
There are four health care providers in Ireland at present which include Irish Life Health, GloHealth, Laya Healthcare and VHI healthcare. In general, health insurance policies are 12 month contracts. If you switch insurer or plan and later want to switch back, you may do so at your next renewal date. Price hikes and changes to tax relief on health insurance policies would make cover so expensive it will force thousands of people to just simply opt out. In 2016, private health insurance premiums rose almost 8% over the past year according to the CSO. The in-patient cost has risen from €75 to €80 a night, an increase in the levy applied to all health polices from April that will also have a knock-on effect on premiums. The Health Insurance Authority of Ireland revealed the shocking statistic that 46% of the population have health insurance, compared to the 2008 peak of 51%. The power is within the powerful health insurance companies who continue to increase the price of their premiums which include VHI who have increased on average 2% to premiums on plans this represents for families an increase between €50 and €100 per annum. So why does loyalty remain?
Finding Health insurance which is suitable to your needs and wants can be time consuming and a challenging experience. That is when the knight in shining armour at Alpha Wealth will review all aspects in finding a plan suitable for you. Laya Healthcare for example have a plan called the Essential Connect Family, where you pay for your first child’s health insurance and all your others are FREE no ,matter how many you have. (*offer April 2017)
The most frequently asked questions
Will my age affect my insurance premium?
No. The health insurance system applying in Ireland is called lifetime community rating. In a lifetime community rated system everyone pays the same premium for a given health insurance plan, except as follows:
- From 1 May 2015, if you first buy health insurance at age 35 or over an age at entry loading may apply to your premium.
- The premium may be reduced by up to 10% for members of group schemes.
- The premium for children must be no more than 50% of the adult premium.
- The premium for those aged 18-25 may be reduced.
- Pensioners who are members of restricted membership insurers may have their premiums reduced.
Who can help me with regards to switching?
We here at Alpha Wealth will provide a FREE health insurance review as part of an overall financial review. The experienced financial advisers here will do there up most to guide you in the right direction. We pride ourselves on our unique team which is more than happy to make your savings work harder for you.