Bupa premiums to increase by 14%
However, the jump is still four points less than the 18% rise pushed through by its competitor VHI late last year.
Competition between the two providers is hotting up and a number of major multinational firms, including Microsoft, have recently “defected” from VHI to the cheaper Bupa due to cost considerations.
VHI, however, still holds 85% of the private health insurance market, while its only competitor Bupa has the remaining 15%.
Some 47% of the population is now covered by private health insurance, compared to 39% when Bupa entered the market over six years ago.
When the latest increase is implemented, Bupa’s most popular health plan, Essential Plus, will still cost around 15% less than its rough equivalent, VHI’s Plan B.
VHI insists its own plan is superior, offering features not offered by Bupa.
Bupa contests this claim and, in turn, says its own products offer certain features and flexibility not offered by its rival.
The row over so-called “risk-equalisation” continues between VHI, formerly the only provider of health insurance, and Bupa.
It is expected that Health Minister Micheál Martin will bring in a risk equalisation bill before the summer.
The idea behind the legislation is to ensure a level playing field for all health insurance firms, on the basis that those with a younger client base are likely to pay out less in claims.
Nearly 90% of the over-50s market is covered by VHI.
VHI’s average customer age is 35. Bupa, however, has an average customer age of 27.
Under risk equalisation, Bupa would make a payment into a fund to be administered by the Health Insurance Authority and used to subsidise firms such as VHI who bear higher risks.
Yesterday’s reports quoted a Bupa spokesman as saying VHI did not need a subsidy.
“Let them come and compete for the people,” he said.
However, VHI said “everybody knows” that risk equalisation must be introduced.
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