Health cover market to be investigated

THE Government has appointed an expert group to review the profitability of the health insurance market in Ireland.

The announcement of the composition of the group by Health Minister Mary Harney yesterday follows on the recent controversial decision by the country’s second largest health insurance provider, BUPA, to withdraw from the Irish market.

BUPA claims it is no longer profitable to operate in the Republic after the High Court ruled last month that the Fermoy-based company must pay a multi-million euro compensation package to its main rival, VHI, under the Government’s risk equalisation scheme.

However, several other companies have expressed interest in taking over the business of BUPA’s 440,000 customers in a development which suggests that they believe the health insurance market in the Republic is sufficiently competitive.

The expert group will be chaired by Colm Barrington, managing director of the Irish division of investment bank, Babcock and Brown. Its other members are Seamus Creedon, a director and partner at KPMG in London, and Dorothea Dowling, CIE group liability manager.

Ms Harney has asked the group to report back by the end of March.