Key Post How to choose the best value health insurance (Work in progress)

Brendan Burgess

Brendan Burgess

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This is very much a skeleton. It will be developed and links will be put in over time. Comments welcome .

First, ask yourself what sort of insurance you need or even if you need insurance at all.

If you are a healthy, non-smoker under 35, then you probably don't need health insurance

Health insurance is great value for older people with medical conditions but it is terrible value for younger, healthy people. Instead of paying €100 a month to an insurance company, you would be better off saving the €100 into a separate savings account and using it to pay for your occasional visits to the doctor.

If you need urgent medical treatment e.g. if you get cancer, if you get a heart attack or if you are in a car accident, you will get it anyway in a public hospital. If you want private or semi-private accommodation, you can pay for it out of your savings.

The main risk you run by not having insurance is that you will need an operation which is not urgent and you would have to go on the public waiting list. But if you have been putting €100 a month, aside for a few years, you will be able to pay for most of these operations yourself in a private hospital.

If you are under 35 and you do want insurance, take out a policy with a big excess

You don't need insurance for day to day medical expenses. They are very bad value for you as you will be visiting the doctor only rarely. Even if you go to a consultant, you can pay the €150 consultation fee yourself.

Your main risk is that you will face a very expensive, non urgent operation. You can cut the premium significantly by agreeing to pay the first €500 of every claim yourself. Put the premium saved into a savings account, so that you have a fund to pay for your health expenses as they arise.

For example, the Laya Healthcare Advantage 500 Explore which costs €559. You will get a semi-private room but with an excess of €500 per claim. In many private hospitals, you could opt for a private room, but pay €200 per night yourself. So a 5 night stay in a private room in a private hospital would cost you €1,500. So why not pay the annual premium and put €50 a month into a savings account. After a couple of years you will have a fund to pay to upgrade to a private room if you need it.

This seems to be a better option than paying €463 for the Laya Assure Vitality which will give you access to public hospitals only, but with no excess.

If you are 35 or over, and healthy, you should probably take out very basic health insurance

The rules are changing on the 1 May. From then health insurers will be able to charge late entrants to health insurance a surcharge of 2% a year for every year over the age of 35.

So although health insurance is bad value for you, you should probably take it out as a long term investment.

You should take out the very basic, cheapest policy to meet the requirements of early entry.

If you develop an illness while you have basic insurance, upgrade it immediately.
You will have to wait two years to claim the higher benefit, but if you face a higher risk of ongoing medical costs, then it's well worth upgrading.

If you have an illness which requires ongoing treatment, you should spend a lot on health insurance as it's great value
You will pay the same premium as a healthy 30 year old, although your claims will be a lot higher.

As you approach 65, you should upgrade your health insurance
As you get older, even if you are healthy, the likelihood of you having medical costs rise.

If you upgrade your health insurance below the age of 65, you will have to wait 2 years to claim the higher benefit. If you upgrade, over the age of 65, the waiting period is 5 years.

Make sure that the policy you choose has full orthopaedic cover - many expensive policies exclude orthopaedic hospitals.



 
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This is very much a skeleton. It will be developed and links will be put in over time. Comments welcome .

It's very hard to sift through the 300 different policies from 4 different companies. The following tips will help you narrow the search:

Phone your insurer and ask if they have a policy with similar or better cover, for cheaper than your current policy
Many insurance companies have multiple versions of the same policies at different prices. They should tell you which is the cheapest if you ask.

Check if your existing policy is on the blacklist of policies which have a cheaper alternative for the same or better cover
List of identical policies from the same company with different prices


Use the Health Insurance Comparison website from the HIA
This will give you a few options to consider.

Use the Laya Create Your Scheme facility
This will give you Laya's recommendation of the best policy from them for your needs. Then put that through the Health Insurance Comparison.

Use the totalhealthcover.ie comparison tool
This will give you one suggested policy from each of the 4 companies

Discussed here
Has anyone used the policy search function on totalhealthcover.ie?

Consider using a broker
The big problem with this is that only one insurance company, Aviva, pays commission on health insurance. So make sure to pay a fee and get a refund of any commission.

Post your proposal on Askaboutomoney to see if there is a better option



 
Some other tips

You have to shop around every year.
What is good value this year, may be bad value next year.

Don't cancel your health insurance completely - go for a very cheap policy.
Some people pay health insurance for years without making a claim. Then they lose their job and cancel their health insurance. If they wait more than 13 weeks before taking it out again, they have to start all over again with a 5 year waiting period for existing illnesses.

If you cut down to the most basic policy, you will at least have the option to trade up later if you get sick. You will have to wait 2 years for the higher benefits to kick in, but that is better than the 5 years for people new to health insurance

Consider opting for a higher excess

Consider paying routine expenses yourself

Do you really need health insurance for children?

Couples do not need to get a plan from the same company.
A younger healthy, non-smoking husband might choose a different policy from his older, chronically ill, smoking wife.

There is no advantage in staying with the same insurance company




 
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Some suggestions
These are suggestions only. Check them out in detail yourself
What other profiles should we cover?

Profile 1 - Aged under 35, healthy, non-smoker
Health insurance is very bad value for you.

Profile 2 - Aged 35+, healthy, non-smoker
Health insurance is very bad value for you, but you should take out a basic policy to avoid being charge more later

Profile 3 - Funds are tight, so require a very basic policy

Profile 4 - Aged 65 + and need good cover

Profile 5 - May need a hip operation in the future

Profile 6 - Chronically ill with high ongoing medical costs

Profile 7- I want a policy with good maternity cover
 
I also would recommend checking the Latest News section on the HIA website for any plans about to be on special offer.
http://www.hia.ie/news/latest-news

On the HIA comparison page, it lists the current premium as per today's date, but most people are actually looking for next month's premium.
 
Good point, and timely now, as the April 30th deadline approaches. Currently the three lowest-priced plans (covering a semi-private room in public hospitals) all have fairly recent commencement dates in their current versions, and all of the insurers are re-pricing from May 1st.

Laya Healthcare Assure First 13-04-2015
GloHealth Base plan 28-03-2015
Aviva Health Aviva Select Starter 22-03-2015

One other tip for people who might currently be looking for "bare bones" cover — don't assume, if for example you search on the HIA comparison site and list the results in ascending order of price, that the best value plan will necessarily be among the first listed/lowest priced. For instance, if you want cover for a family with one or more students aged 18-22, Laya's no-frills Assure First plan will charge them at the adult rate of €395, whereas on their (slightly better) Assure Health plan they drop to the child rate of €185. Also, some regularly offer specific discounts on kids (e.g. Laya, at the moment, on certain plans).

Similarly, on the Laya "Create Your Scheme" page — basic plans like the above offer very little for day-to-day expenses anyway, but it can be interesting to see what happens when you move the slider from "standard" to "enhanced" (or "comprehansive"). In my case, the premium rose by €300-odd, but (a) it now included some small bit of cover for GP & Physio fees, and (b) the annual family excess fell from €450 to €150 (in other words, if I opt to save €300 on the premium, we have to spend €300 more on these expenses before we can claim anything, if at all)

It's a pity Laya's "Create Your Scheme" page doesn't allow you easily to price different levels of cover for individual members which, as mentioned above, is a smart way to reduce costs where needs/profiles differ across the family.

Edit: No connection to Laya, other than as a reluctant customer...!
 
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Even though the original post is 6 years old, it has helped me make some decisions on an upcoming health insurance renewal, thank you.
 
Brendan Burgess said:
The main risk you run by not having insurance is that you will need an operation which is not urgent and you would have to go on the public waiting list. But if you have been putting €100 a month, aside for a few years, you will be able to pay for most of these operations yourself in a private hospital.
Click to expand...

It can be extremely expensive to self-pay for surgery privately. If there is an ICU stay then it can be tens of thousands.

This also assumes that people will faithfully save and ringfence that money - surely unlikely unless very motivated.

Brendan Burgess said:
If you develop an illness while you have basic insurance, upgrade it immediately.
You will have to wait two years to claim the higher benefit, but if you face a higher risk of ongoing medical costs, then it's well worth upgrading.
Click to expand...
2 years can be a very long time if you are unwell and for some conditions delays in accessing care have ramifications for years/decades.
 
does anyone know if private health insurance adds an extra percentage when someone reaches a certain age, 65 or 66...and if so, is it common policy for all companies?
 
No...Below is an answer from the HIA to 'Will my age affect the cost of my policy?'

Generally, no. The health insurance system in Ireland adopts what is called Lifetime Community Rating. This means that everyone who buys a particular health insurance policy pays the same amount regardless of age, gender, health status or medical history. However, there are some exceptions:

  • If you buy health insurance for the first time when you are aged 35 or over, or if you have a break in health insurance cover of longer than 13 weeks while you are aged 35 or over, you will have to pay an additional Lifetime Community Rating loading on top of the cost of your policy.
  • The cost of a policy can be reduced by up to 10% for members of group schemes.
  • The cost of a policy for children must be no more than 50% of the adult premium.
  • The cost of a policy for those aged 18-25 may be reduced.
  • The cost of a policy for pensioners who are members of restricted membership insurers can be reduced.
 
everyquest1on said:
hey, im 27, and im non smoker, but im still worried about my health, i dont know why, i am kinda paranoid about my health, should i still consider applying health insurance how do you think? And yes i have some spare money, but there are a lot of other things that i need right now.
Click to expand...

It depends on how risk-averse you are.
From a purely probabilistic perspective then and that assuming you are Mr/Ms Average in terms of health it's probably a bad bet buying health insurance, financially speaking.
The fact that community loading doesn't come into play until after age 35 reinforces that, I think.
The statistically optimal age to buy Health insurance must be some way north of 35 I imagine.

I've always had it myself, btw, even in my twenties, just in case...
 
Having an insurance might give you peace of mind if you are so worried.
I personally would not take up health insurance under 35. If you are young in good health and considering you will get the same cover for emergency cases....There is an upper limit you will pay if you need to go to a hospital per year too.
Read the post from the beginning as no much has changed since and it will help you to decide.
 
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