In general, health insurance policies are 12-month contracts. All insurers must provide a 14-day cooling-off period from the commencement of the contract, during which time you may cancel and get a full refund. No claims will be paid in respect of these 14 days.
Current Market Practice
Irish Life Health
Irish Life Health will provide a 14-day cooling-off period from your renewal date, where you may cancel, get a full refund and switch to an alternative plan or insurer. Irish Life Health will also allow you to switch your plan mid-term to another Irish Life Health plan. However, you cannot switch from Irish Life Health to another insurer mid-term without penalty. You can cancel you policy by phone, email or letter.
The mid-term cancellation charge will consist of the health insurance levy calculated on a pro-rata basis for each adult, student and child on the policy for the remainder of the policy term, together with an administration fee of €25 per policy.
Laya Healthcare will provide a 14-day cooling-off period from your renewal date, where you may cancel, get a full refund and switch to an alternative plan or insurer. Laya Healthcare will also allow you to switch your plan mid-term to another Laya plan. However, you cannot switch from Laya Healthcare to another insurer mid-term without penalty. Laya will seek the full year's premium if you cancel mid-term.
Laya request all policy cancellations in wiritng by email or letter.
Vhi Healthcare will provide a 14-day cooling-off period from your renewal date, where you may cancel and get a full refund.
Vhi will allow you to switch to another Vhi plan mid-term, this option is available on select policies and terms and conditions apply. However, you cannot switch from Vhi Healthcare to another insurer mid-term without penalty.
If you stop paying your Vhi premium mid-term and have had no claims, they will charge you a cancellation fee. This is equal to the health insurance levy, per person, on a pro-rata basis, for the remaining period left on the policy plus a €50 administration fee per policy. Payment of this penalty does not affect your rights to take out a policy with another insurer.
If you have had claims since your last renewal date, Vhi will charge the full year’s premium.
Why am I being charged the full health insurance levy on my subsequent contract?
The Health Insurance Act requires health insurance companies to charge all customers purchasing a particular health insurance policy the same premium for that policy. This is known as “Community Rating”. The obligation on the health insurer to charge the same premium applies whether the customer is taking out a policy for the first time, renewing an existing policy or switching mid contract period from another health insurer.
The premium charged by the health insurer includes an amount for Stamp Duty, sometimes referred to as the “health insurance levy”. It is the obligation of the health insurer to pay the Stamp Duty to Revenue. This stamp duty helps support the community rated private health insurance market.
When you cancel your health insurance policy before the expiration of your contract you are charged a cancellation fee as described above part of which relates to the health insurance levy for the remainder of the original term of the contract. Stamp duties are paid to the Revenue upfront and refunds are not permitted under Revenue rules.
If you then take out a second health insurance contract shortly after with the same or another health insurer, the insurer must charge you the same premium in respect of that contract as it would charge to any other person purchasing that contract in respect of the same period irrespective of whether or not a second stamp duty is payable to the Revenue Commissioners. The insurers must do this to comply with community rating legislation