VHI to hike price of health insurance by 7% from October

VHI has hiked prices twice in just six months, with the two increases combined raising prices by almost 12%

Speaking on the increases, 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." Picture Dan Linehan

Health insurance provider VHI has announced a significant hike in prices which will see customers pay hundreds more for their premiums.

Coming into effect from the 1st of October, the provider said the 7% price hike was driven by a "significant" increase in demand for healthcare following the pandemic, with the announcement marking the company's second hike in just six months.

Its first price increase of 4.8% earlier this year was estimated to add €270 in additional payments for families, with the two increases combined raising prices by almost 12%.

Speaking on the increases, 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."

“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.”

Mr Keogh added that VHI "solely existed" to meet the healthcare needs of its members, adding that any surplus generated is invested in improving its services.

Earlier this year, VHI posted a net surplus of €34.3m from consolidated business activities, down from €65.3m in the previous year. The company also saw claims rise by 10% annually, totalling €1.425bn in 2022. In the same period, VHI reported a gross written premium of €1.6bn on private health insurance.

There are more than 20 VHI healthcare facilities across Cork, including clinics in hospitals, out-patient centres and diagnostic centres where cover is provided.

VHI is the latest insurance provider to hike prices this year and follows premium increases from both Irish Life and Laya Healthcare.

Laya, the second largest health insurer in the State, announced plans to increase the cost of its policies by an average of 3%, which was on top of a 4.4% average rise in premium rates earlier in the year.

Similarly, Irish Life also announced two consecutive rate hikes, which combined will see premiums rise by up to 14%.

The Health Insurance Association, who insurers are obliged to give 30 days notice of price changes, were informed on Wednesday morning of VHI's impending price hikes.

Speaking on the changes, the HIA said that due to medical inflation and an increase in claims, insurers have effected a number of price increases this year, adding that 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," the HIA concluded.