Ireland's largest private health insurance provider VHI has announced it is increasing its prices for the second time this year.

The State-owned health insurer will increase the cost of premiums by 3.5% from October 1.

A spokesperson said the decision is in response to a significant rise in healthcare claims, with a 14% increase in private hospital claim costs in the first half of the year compared to 2023. They added that the costs associated with the delivery of healthcare are rising, driven primarily by the increased costs in private hospitals and associated healthcare professional costs.

To help ease the impact on families, Vhi is introducing a 25% reduction in premiums for children on selected plans. Also from October, day-to-day benefits will be added to some plans that previously lacked this feature.

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Customers will be informed of any changes to their plan including any price or benefit changes in their renewal letter.

Commenting on the price changes, Aaron Keogh, Managing Director of Vhi Insurance DAC, said: “We have taken the decision to introduce a price increase from October 1 as premium income has not kept pace with healthcare demand and associated claims costs. We have to price prudently for the future so that we remain in a position to meet the healthcare needs of our members. We understand the affordability challenges that many people are facing and the importance that is placed on retaining health insurance and we are determined to continue to deliver value for money.

“Vhi reported financial losses in 2023 reflecting the challenging environment within which we are operating. 2023 and 2024 have seen accelerated growth in healthcare claims volumes and as a result unprecedented increases in healthcare claims costs. This is because our members are accessing more healthcare than ever before in a variety of settings.”

He continued: “At Vhi we are supporting our members to stay well, building networks of connected services in our Vhi 360 Health Centres, providing access to rapid access dermatology services, a sports and musculoskeletal clinic, paediatrics clinic, women’s health clinic and positive minds programme ensuring our members receive high quality, high value care. Vhi members also get digital access to expert clinical care. They can make an online appointment with a Doctor, Physio, Dietician and Speech and Language therapist all based in Ireland anytime through the award-winning Vhi app. Members utilisation of these services continues to grow. This is a welcome and expected development as we engage with our members to encourage them to proactively look after their health and avail of the many preventative healthcare services we offer.”

The Health Insurance Authority (HIA) said it has received notice of Vhi’s decision to change prices. A spokesperson said: "While we are aware that these price increases may have an impact on some consumers, the health insurance market in Ireland is an open market, and insurance providers can make price changes as they see fit. These prices are based on the cost of the claims that the insurers receive. There have been a number of health insurance price increases across the market in the past 12 months which is attributed to medical inflation and an increase in claims. According to our latest Annual Market Report, the total level of claims paid by insurers in 2023 rose by 15% on the previous year, and there was a slight increase in claims for private hospitals.

"Consumers are free to move to any plan on the market at their renewal date, and we encourage everyone with health insurance to review their policy each year to make sure that they are on the right plan for their current lifestyle and health needs. Our helpline is open, and we are available to provide information about health insurance, answer questions and give information to help consumers find a health insurance plan that fits their budget.

"If you are a Vhi Healthcare customer, these price changes will affect you if you renew your policy on or after 1 October. If you are mid-contract, the cost of your insurance won’t change on 1 October. Use the free comparison tool on our website www.hia.ie to compare plans, or contact us by email (info@hia.ie) or phone (01 406 0080)."

Examples of Vhi price changes

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