A new report shows that insurance prices will soon rise again, potentially rendering the benefits from yesterday’s Budget tax cuts meaningless.
While a 3 per cent increase was expected, the report shows says the cumulative rise will in fact come to 10 per cent.
The report comes from Total Health Cover, a group that analyses the packages and trends in health insurance. For this report they looked at VHI and Laya, who hold control over 75 per cent of the market.
The author of the report, Dermot Goode, says this is due to insurance companies rise the prices by a small amount numerous times throughout the year, meaning the annual cost is far higher than presumed.
Mr Goode provides the example of how two adults and two children may now be asked to pay up to €480 more on certain plans.
He also told the Irish Independent that “VHI's Health Plus Access (the old Plan B) will go up by 10pc for adults and 11pc for children. This will make it €460 dearer. One Plan Family will be €250 more expensive for a family, with the Family Plan Plus Level 1 set to be €482 dearer. VHI's Health Plus Premium plan will go up by €656 for a family.”
A spokesperson for VHI told that newspaper the price increases are caused by "the rising cost of claims and in particular the rising costs of claims in public hospitals."
It has also been revealed that the Government’s expected take from private charges in public hospitals of €30 million was a major underestimation, as the the actual yield was €150 million.
Speaking to ThatsFarming.com Anne-Marie McNally, political director with the Social Democrats, said these price increases are an example of a high cost of living and were not tackled in yesteday’s Budget. She said:
“These insurance costs are a big factor in why people are finding it hard. We know too that car insurance has increased by over 60% in recent months, and this has been allowed to occur through the Government’s inaction.”
Other opposition parties such as Sinn Féin have called for the Government to implement controls across several sectors, so prices could be prevented from rising any further for a set length of time. However when rent controls were introduced to stop this in the property sector, landlords were able to increase rent due to the deadline for the controls being several months away.