The sale of Laya Healthcare — Ireland’s second largest health insurance provider, to AIG is good news for the consumer, says health insurance expert Dermot Goode.
However, Mr Goode, health analyst with totalhealthcover.ie, said he could not foresee health insurance reductions in the short term.
“What we will see is less upward pressure on rates because, obviously, Laya will have a much bigger parent working with them.”
AIG has agreed to buy Laya for an undisclosed sum and the transaction is expected to close in the first half of this year once the necessary regulatory approvals have been obtained.
Laya said it was business as usual when it came to members’ day-to-day dealings with the company.
The company will continue to operate in Cork, where it employs 450 people.
Mr Goode said that right now, he could see no downside from a consumer perspective.
“AIG will give Laya huge muscle to compete with the big guns in terms of cross-selling existing and new insurance products.”
The deal was also a ringing endorsement of Laya and gave more security to Laya customers and staff.
Despite the healthcare market being hammered with levies and haemorrhaging members, AIG thought Laya was a very good business with a good management team and was happy to invest in it.
AIG has plenty of experience in healthcare insurance, with sickness and accident policies, income protection, and cash plans. It has a cancer health benefit plan on the market already.
“The potential synergies here are significant in terms of cross-selling their products to nearly half a million Laya members and vice sa versa,” said Mr Goode.
He said he would not be surprised to see “bundled” insurance products being sold, such as car, home, and health insurance.
“It is a great way of locking customers in across all three products. Right now we can only speculate as to what the implications might be for members but I think those will be positive.
“I don’t see any downside to this whatsoever. Right now it is all good news.”
© Irish Examiner Ltd. All rights reserved