Govt to review profitability of health insurance market

The Government is planning to set up a group to review whether health insurance companies can make a profit in the Irish market as it stands.

The panel will include business and insurance experts, who will produce the report in about three months.

According to reports this morning, the Minister for Health put the plan for this business review before Cabinet on Tuesday.

It follows Bupa’s decision to pull out of the Irish market, because it claims the risk equalisation scheme will make business here unprofitable.

Under the scheme, Bupa would have had to pay millions of euro of compensation to its main rival the VHI, due to its older client base.

It is understood the Government hopes that if the review shows that sufficient returns can be made in the Irish health insurance market, other international companies may consider operating here.

Bupa has long contended that the absence of other major players in the Irish market, is proof that it is not commercially enticing.