Vivas Health yesterday called for legal action to be taken against VHI following the publication of the Competition Authority's report into competition in the private health insurance market.

Vivas welcomed the recommendations in the report, which are aimed at promoting competition in the sector. However, the insurer called on the Competition Authority to mount a full investigation into VHI's "anti-competitive" practices now, with a view to taking legal action.

"The report confirms that risk equalisation is anti-competitive. VHI already has 75 per cent market share and has the benefit of a wide range of state protections and supports which will give it an unfair advantage in this fight," chief executive Oliver Tattan said yesterday.

"The dominance of the VHI and the protectionist supports which it receives must be dealt with if we are to see a competitive health insurance market," he continued.

VHI Healthcare said yesterday that it would not issue a full response until the lengthy report had been thoroughly analysed. However, the company expressed satisfaction yesterday that "much of the advance speculation" concerning the report had not materialised. It is believed that the company was referring to speculation that the Competition Authority might recommend that the insurer should be split.

VHI said that many of the issues raised in the report are already being addressed and will be dealt with in new legislation relating to price changes.

The company added that the major issue in private healthcare is still the Government's response to the possibility of an initial derogation from risk equalisation payments being granted to Bupa following its acquisition by Quinn Group. "This would effectively mean the end of community rating in Irish health insurance," it said.