We recently reviewed the results of research carried out by the Health Insurance Authority (HIA) which made for interesting reading. The HIA completed the research by carrying out 1,891 face-to-face interviews with adults across the country in September and October 2017. They have carried out this research every 2 years over the last decade, which has enabled them to identify trends in relation to health insurance.
We reviewed the research with a view to being better informed on behalf of our customers and to guide us where necessary in improving our health insurance proposition for you.
The proportion of the population with Private Health Insurance (PHI) has increased again this year, with 43% of people now claiming to be covered by PHI. This is an increase of 2% since the survey was last carried out, reflecting the demand for PHI in the current more buoyant economic environment.
However we continue to see a socio-economic divide, with PHI coverage among professional / white collar workers significantly greater than among blue collar workers and the unemployed. This latter group have a much greater reliance on our creaking public health system.
Coverage levels remain low among adults under the age of 35. While they account for 30% of the overall population, only 21% of hem have PHI cover. This suggests that more work needs to be done by health insurers to get the message across about Lifetime Community rating and the long-term cost benefits of taking out health insurance before the age of 35.
Almost 70% of those with health insurance are married, which is not surprising as maybe it reflects both a slightly older age profile, as well as possibly a greater sense of responsibility among married people!
What people think about PHI
While almost 6 out of 10 people see PHI as a necessary purchase rather than a luxury purchase, there is a continuing belief that PHI enables people to both skip waiting queues and also to access better levels of medical care.
One of the most significant changes in this research in comparison to previous years is that 40% of people now buy PHI because the cost of medical treatment and hospital accommodation is so high. The comparative figure was only 31% in 2015.
The other main reasons given by people for purchasing health insurance were the inadequate standard of public health services (30%) and the difficulty of actually accessing public services (24%, also up significantly from 18% in 2015).
An important finding among people who don’t have PHI today is that price is the biggest barrier to them taking out this cover.
People are switching less
Less than one in four people with health insurance have ever switched their policy, with most people not even considering doing so. This is surprising as these people are potentially missing out on significant cost savings and benefit enhancements. As many of the customers of Lyons Financial Services will attest, there are huge potential benefits if your adviser knows where to look! Also 61% of people (rightly in our view) perceive the process of switching as easy.
Attitudes towards the Cost of PHI Policies
In 2017, the perceived annual cost of a policy was €1,858 which actually represents a slightly lower perceived cost than in 2015. Back in 2013 when Ireland was still in the teeth of the recession, 20% of people had downgraded their plan in the previous two years, while in 2017, this figure had fallen to 11%. Similarly the number of people who had upgraded their plan had doubled from 2013 to 2017, with greater numbers also planning on doing so in the future.
The numbers of claims are up across the board – 43% claimed for an overnight stay in hospital (up from 35% in 2015), day patient treatment claims increased significantly too with an overall 60% of policyholders having made a claim of some sort, up from 57% in 2015.
Satisfaction with PHI providers
The good news for health insurance providers and advisers is that satisfaction levels remain high and are even still increasing. Almost 9 in 10 people are happy with the quality of information they receive from providers and with the customer service and range of products offered.
So it’s pretty buoyant news for the health insurance sector. Clients are happy, policyholder numbers are up and people are actively using their policies by making higher levels of claims. Probably the one disappointing area is the lower awareness and action around switching policies, as there are significant benefits to be gained by clients in this area.
Lyons Financial Services are always delighted to be given the opportunity to try to help you save money and improve your health insurance benefits. Please feel free to give us a call at 01 801 5808 before your next renewal date, and find out how we can help you get the right policy in place.