Irish companies, as well as Continental, have expressed an interest in entering into a partnership with VHI, the company's chief executive, Mr Oliver Tattan, said yesterday. The company's future will be made known within the next few weeks when the White Paper on health insurance is published.
Mr Tattan said the company wanted a shareholder with a proper commercial agenda. An investment of £60 million was needed and a likely scenario was that the Exchequer would invest half, with the other half coming from an outside investor, perhaps a financial institution.
A spokesman for the Department of Health said the "finishing touches" were being put to the White Paper and it would be published by the Minister shortly.
Mr Tattan told The Irish Times that VHI could not keep operating as it was forever. "It's not a proper, prudent, or wise way to run an insurance company. We need some sort of clarity. There has been lots of outside interest, European companies as well as Irish ones. Health insurance cover is a huge growth business."
He said the company also needed commercial freedom to be able to launch new products and services. The State's health insurance industry was very underdeveloped . "All you can buy is acute illness cover, you cannot buy primary care cover or dental cover."
Mr Tattan said VHI now had 1.46 million subscribers. Last month, the company reported a much-improved financial performance, with pre-tax profits jumping from £2.8 million to £11.2 million. The increase in profits allowed the company to add a further £8.8 million to its reserves. But Mr Tattan warned that the total reserves of £87 million were still only 25 per cent of premium income needed to maintain the company's solvency requirements.
Regardless of what option is proposed in the White Paper Mr Tattan said subscriptions would continue to increase at a similar rate to previous years. However, he said he was unable to predict the exact nature of the increases. "It is a good assumption that they will go up. A lot depends on medical inflation, what new technologies will be available."