Making Cents: How to minimise LCR loading on health insurance

Number 1, your policy should cover all public and all private hospitals.

Q. We are a couple who were severely stretched at times in the aftermath of the 2008 recession and couldn't afford health insurance. We are now in a better position financially and keen to get cover but worried about the impacts of the lifetime community rating. I'm 50 and my wife is 42, is there anything we can do to reduce the loadings if we sign up for health cover?

Since 2015, if you are over the age of 34 when you first take out health insurance, you will have to pay extra for your cover under the Lifetime Community Rating (LCR) loadings. 

It works out at an extra 2% of your premium for each year above 34, up to a maximum of 70%, and lasts for 10 years. To answer this question I turned to health insurance expert Dermot Goode of www.totalhealthcover.ie. 

The first thing Mr Goode made clear is that there is no way around the loadings, except in very limited circumstances.

“If they never had health insurance before they are going to have to pay the age loadings,” Mr Goode says. “Take 34 from their ages and multiply by 2%. It is a legal requirement, the insurance companies have no discretion.

“The only mitigating factors are if they have just returned to Ireland in the last nine months or if they had previous health insurance.” 

That second factor, having previously had insurance but let it lapse, is one he particularly wants to highlight. I checked with the letter writer and his wife had cover for a number of years pre-2008.

“She needs to dig out those details because all she needs to do is phone the insurance company and they will give her full credit for that,” he says. “So if she had cover donkey's years ago for 10 years, that wipes her loading (of eight years) completely.

You don’t need to go to the same insurance provider you were with previously, but you do need to get written or email confirmation of the length of cover from them to show other insurers.

Mr Goode's advice for this couple, and for anyone else looking at health cover for the first time, is to work out how much you have to spend and then go to health providers with that figure and see what they suggest. Otherwise, you risk hearing about policies with everything you could want, only to find out at the end of the conversation that they are completely out of your budget.

“If you decide your budget, then when you phone the insurance company and you tell them, then the company will try and find something that fits that budget and it cuts out all the nonsense.” 

I suggest to Mr Goode that perceived complexity can put people off choosing health insurance, with a multitude of policies from each provider offering seemingly endless combinations of benefits and conditions. So what are key questions to bear in mind, what does good cover look like?

“Theres a few things,” he suggests. “Number 1, it should cover all public and all private hospitals, so in Cork it will get you into CUH but it will also get you into the Bons or the Mater Private.

“The second thing is it will have small to medium excesses, you might have to pay €250 or €300 per claim in a private hospital. There are plans out there where the excess is €450, €500, €600 - the excesses are prohibitive and people end up avoiding the private hospital because of it.

“Then depending on someone's age, if someone is mid-forties or going in that direction, we recommend they also have hi-tech cardio. [This] means they are fully covered for about 50 major heart procedures that are mainly done in the likes of Blackrock Clinic and the Mater Private in Dublin. People are getting operations [such as stents] done at a much younger age for preventative reasons.” 

This is general advice Mr Goode also says people should also consider their particular lifestyles when choosing their cover, highlighting those who pursue highly active sports in their spare time as an example.

If you feel you don't know where to start, Mr Goode's website totalhealthcover.ie has a policy search section, with plans broken down into different categories. 

If you have specific requirements or would like a professional review, his company does a full review across the market, irrespective of whether you are coming to the market or reviewing your cover, for a flat fee of €125.

Saving on back-to-school shopping

If you are already working on your back-to-school shopping, it is worth taking note that Aldi's Back To School range hits stores this Sunday August 1. 

The heart of this range is the retailer's uniform deal, allowing parents to kit schoolchildren aged 4-12 out in a basic uniform for €5. The deal includes a pack of two girls or boys polo shirts (€1.99/2 pack), a children’s sweatshirt (€1) and trousers for both girls and boys (€1.99) or a pleated skirt (€1.99) – totaling €4.98. 

The range also comes with a 150-day satisfaction guarantee. 

There are other uniform items on sale, including pinafore (€7.99 / 2 pack), tights (€4.49/3 pack), and leather shoes (€6.99 per pair in sizes 10-2). 

Parents can also stock up on clothes for P.E. classes and accessories including backpacks and lunch bags. 

The above products and more are on sale in 147 Aldi stores nationwide from Sunday, August 1 while stocks last.