New Premium Loading Scheme to Hit Over 35s, Says Health Insurance Company Simple Financial Solutions

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“You’re never too young to have health insurance.” That’s the key take home message from a new system launched by the Irish government to encourage people under 35 to take out health insurance policies, says

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This is a very important initiative in Ireland and sorely needed. In 2013 alone over 47,000 people stopped their health insurance polices, and since 2008 the market has fallen dramatically.

The new system, called the Lifetime Community Rating, was announced by the Government’s Health Minister James Riley and will come into effect in May 2015. The system will add 2% to the premiums of the over-35s as a way of ensuring life insurance premium inflation does not rise out of control.

If the majority of people are over 35 when they join community schemes, the costs of premiums will rise for everyone. On the other hand, the younger people are when they join the better it is for all policy holders, as younger people do not claim as often as older people and will therefore help keep premium costs down across the board.

Minister Reilly said, “This is an important initiative which will support sustainability and competitiveness in the health insurance market. I want to encourage young people into the market at an early age. At the moment, anyone can wait until quite late in life to join, and enjoy the same community-rated premium paid by people who have had health insurance all their lives. Given the changes to the market profile, this is no longer considered appropriate, and it doesn’t encourage an efficient insurance market.”

There is a grace period until May 1 2015, after which the 2% or annum loading fee will be added to the premiums for new entrants aged over 35s. Any individuals who have previously had health insurance policies, have emigrated or who have been unemployed since 2008 will have credit applied to help bring down their premium. The scheme will signal an end to the previous community rating system that has been adhered to since the 1950s, where older premium holders were protected from being charged more for a health insurance premium just because of their age.

Minister Reilly continued, “There is something inherently unfair with the idea of somebody who has been insured all their lives up to the age of 55 paying the very same premium as somebody who takes out insurance for the very first time at the age of 55.”

The Health Insurance Authority said, “Community rated markets depend on a continuing influx of younger people. Younger people claim less on average and, accordingly, a continuing influx of younger people keeps premiums down for everybody. Conversely, if people wait until they are older before taking out private health insurance premiums will increase for everybody.”

A spokesperson for Life Insurance Company Simple Financial Solutions said, “This is a very important initiative in Ireland and sorely needed. In 2013 alone over 47,000 people stopped their health insurance polices, and since 2008 the market has fallen dramatically.

Over 50% of the Irish population held health insurance policies then. Today that had declined to 45% with the greatest percentage of loss seen among younger members. Overall some 250,000 customers have stopped their insurance premiums since 2010, the majority of who were under 30.”

“Without this new scheme, experts have warned that the market is liable to collapse.”

About Simple Financial Solutions:

Simple Financial Solutions are one of the UK's leading financial advice companies. They provide everything from loans and mortgages through to life insurance and business debt advice. Visit them now at

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Candace Garrett
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