THE VHI has defended a decision to impose a charge of €700 on a Dublin couple who wanted to cancel their health insurance policy because they could no longer afford the monthly premium of more than €180.
Last summer, as thousands of people each month began leaving the private health insurance market, the State’s largest insurer introduced a €50 fee for subscribers who cancelled policies midway through their 12-month contracts.
The company also started clawing back the annual Government levy it pays on their behalf on a pro-rata basis and the impact of the modification means the couple who contacted The Irish Timeswill have to find €700 if they want to cancel their policy.
The State provides age-related tax credits for older people to help meet the higher cost of health insurance. The credits are funded by a levy paid by health insurers which Minister for Health James Reilly recently increased from €205 to €285 for an adult and from €66 to €95 for a child.
The couple are being expected to pay 11 months of the levy if they wish to cancel the policy.
The woman said she was in shock “to find out that a policy we wish to cancel for financial reasons is subject to this outrageous charge which we cannot possibly pay due to other commitments”.
When contacted the company defended the charge. It said it was “fully aware of our obligations to our customers” but said it was satisfied it has “taken all reasonable steps to ensure that our customers are fully informed of the details of their contract in advance of their entering into the 12-month contract”.
It said it specifically referred to the consequence of early cancellation by a customer and to terms and conditions in its contract renewal letters.
