THE newest entry to the health insurance market claims an average family can save more than €400 a year by switching from VHI.
Hibernian Health, which formally replaces Vivas from July 1, also claims to save a family of two adults and two children €170 for the most popular policy compared to its next cheapest rival, Quinn Healthcare.
Hibernian also claims it beats its two competitors on its range of services.
Quinn and VHI swiftly accused Hibernian of using unfair price comparisons. Quinn said a policy it launched last week, was equivalent to Hibernian’s family policy and was €293 cheaper.
Hibernian’s purchase of Vivas followed Quinn’s purchase of Bupa Ireland. The original two rivals to the former VHI monopoly came under pressure due to the risk equalisation scheme which requires insurers with younger, healthier customers to pay subsidies to VHI so that it does not have to charge higher premiums to its older customers.
Vivas estimated it would have to pay €20 million to VHI over the next three years under the scheme although the results of a Supreme Court challenge taken by Bupa prior to its takeover are still awaited.
Hibernian Group chief executive Stuart Purdy said Hibernian bought Vivas with the assumption that risk equalisation would continue and subsidies would have to be paid, but said this was not sustainable if more competition was to be encouraged.
Health Minister Mary Harney has welcomed the arrival of Hibernian into the market but said risk equalisation would remain a market feature.
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