Lifetime community rating (LCR)
Lifetime community rating is a system whereby the premium that individuals pay for health insurance rises with the age they enter the private health insurance market, but does not vary in relation to their current age. Under this system, a 50 year old who has held insurance since he or she was 30 would pay the same as a 30 year old, but a 50 year old who purchases insurance for the first time would pay more than a 30 year old.
1. What is Lifetime Community Rating?
Lifetime community rating modifies community rating so that the premium that individuals pay for health insurance increases with the age at which they enter the private health insurance market. It does not vary in relation to their current age.
Under this system, a 50 year old who has held insurance since he or she was 30 would pay the same as a 30 year old, but a 50 year old who purchases insurance for the first time would pay more than a 30 year old.
2. Why was Lifetime Community Rating introduced?
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.
Lifetime Community Rating encourages people to join the private health insurance (PHI) market at a younger age and this will help in controlling premium inflation
3. When was lifetime community rating introduced?
Loadings apply to people aged higher than 34 taking out inpatient private health insurance for the first time after 30 April 2015.
4. What loadings will apply?
A loading of 2% of the gross premium will apply for every year of age higher than age 34 that an individual has attained when they first purchase inpatient private health insurance after 30 April 2015.
5. Will I have to pay a loading for the rest of my life?
No, loadings will apply for a maximum period of 10 years.
6. What is a health insurance cash plan?
A health insurance cash plan provides monetary benefits for a range of medical events but unlike other private health insurance plans, health insurance cash plans do not provide inpatient cover for costs incurred in hospital as a private patient.
7. Are health insurance cash plans included in Lifetime Community Rating?
No. Loadings will not be applied to health insurance cash plans. If you did not hold an inpatient private health insurance plan by 30 April 2015 and you are 35 or older, a loading will be applied for 10 years to any inpatient plans that you purchase after this date.
8. I have a health insurance cash plan and I am over age 34. Will a loading be applied to me if I switch to an inpatient private health insurance plan after 30 April 2015?
Yes. Health insurance cash plans are not included in Lifetime Community Rating, so if you do not hold an inpatient plan by 30 April 2015, a loading will be applied when you switch to, or purchase an inpatient private health insurance plan after this date.
9. I am aged over 34 and I have never had health insurance, does that mean that I will have to pay a higher premium when I get it?
Yes. A loading of 2% of the gross premium will apply for 10 years for every year over 34 you have attained.
10. Are my previous periods of inpatient cover taken into account in calculating the loading?
Yes, if you take out inpatient private health insurance after 30 April 2015, your previous periods of cover will be taken into account in calculating the loading that will apply to you. If you had continuous cover for the period 1 May 2009 to 30 April 2015, the insurer will consider you to have had continuous cover since the age of 23, even if you have no proof of cover prior to 1 May 2009. If you did not have continuous cover for the period 1 May 2009 to 30 April 2015, but you held insurance prior to 1 May 2009, the onus is on you to prove you held insurance at that time.
Periods of cover held on a health insurance cash plan will not be taken into account for the purposes of calculating loadings.
11. I am 50 now, I had inpatient private health insurance for 5 years in my late 20s / early 30s and then I let it lapse. Will I have to pay a higher premium under Lifetime Community Rating, given that I first got insurance under age 35?
Yes. Your insurer will calculate your age of entry under Lifetime Community Rating. This will be your age when you are purchasing insurance less any previous periods of cover (in this example 50 – 5 = 45). You will pay the same loading as a 45-year-old who is purchasing private health insurance for the first time, i.e. 22%.
12. I was covered under my parents’ policy for my whole childhood but it then lapsed. Will I get credit for this when calculating my Lifetime Community Rating loading?
No. Credit does not apply to periods of cover as a child.
13. I am immigrating to Ireland. Will I have to pay a Lifetime Community Rating Loading?
If you purchase private health insurance within 9 months of becoming resident in Ireland you will not have to pay a Lifetime Community Rating loading on your premium. If you are 35 or older and you do not purchase private health insurance within 9 months of moving to Ireland, a loading of 2% of the gross premium for every year over the age of 34 that you have attained will be applied to your premium.
14. What about people who have emigrated, will they have to pay the loading when they return?
A person who lived outside the State on 1 May 2015 and moves to Ireland has 9 months from the date of moving to Ireland to purchase inpatient private health insurance avoiding a Lifetime Community rating loading.
For a person that lived within the State on 1 May 2015 and subsequently moved to life outside the State, a credited period is given for any periods of cover of not less than 6 months commencing on or after 1 November 2018 in respect of which a person resides outside the State, provided he or she becomes an insured person within 9 months of ceasing to reside outside the State.
15 How do I show that I was not resident in Ireland on 1 May 2015 and moved to Ireland in the last 9 months?
This can be done for instance by providing evidence of accommodation lease arrangements or utility bills paid while abroad and copies of bank statements opened while abroad. Travel documentation or application for a PPS number is evidence of taking up residency in Ireland after not being resident.
16. I had to give up my insurance because I couldn’t afford it any more after I lost my job. Is there any allowance made?
The Regulations include an allowance of up to three years for persons who held insurance but then had to give up their insurance as a result of redundancy for a period occurring after 1 January 2008. The persons must have been in receipt of Social Welfare (or have been financially dependent on someone who was) during the period directly after being made redundant and giving up their health insurance, and they must be unemployed for a period of 6 months or more. Effectively, such periods will be treated as if you did have insurance cover when calculating any premium loading up to a maximum credit of 3 years.
17. Are credited periods given if I give up my insurance for other reasons?
Persons who have cancelled their insurance for 6 months or more, having previously been insured for at least 3 years, will be credited for any periods of non-cover which begin on, or after, 1 February 2019. The period of 3 years cover does not need to be consecutive. The credited period is limited to 3 years and is available regardless of why the insured person cancelled their insurance.
18. Can I drop my health insurance for a period without a loading applying?
Breaks in cover of up to 13 weeks are allowed without affecting your loading
19. I had insurance on 1 May 2015 but later allowed my insurance to lapse for more than 13 weeks. Will a loading apply when I take out insurance again?
Yes, a loading will be applied to your premium of 2% of the gross premium for every year over 34 that you have attained if you allow your insurance to lapse for more than 13 weeks. Your previous periods of cover will be taken into account in calculating the loading that will apply to you. Credit may also be applied for lapses once certain criteria have been satisfied (See question 16 and 17).
20. What is the maximum loading that can apply?
The maximum loading that can apply is 70% of the gross premium in the event of a person aged 69 or older purchasing inpatient private health insurance for the first time. The loading will apply for a maximum period of 10 years.
21. Will all health insurers apply the loadings?
All insurers have to apply the loadings to their inpatient private health insurance plans.
22. What happens if I switch insurer?
Switching insurers does not affect your loading. Any loadings will continue to apply and insurers will supply each other with proof of an individual’s previous cover.
In some circumstances you may be asked to provide evidence of previous periods of cover. It is beneficial to retain proof of cover. In these instances, you need to contact your previous insurer and ask for a "confirmation of cover" letter
23. What rules apply to former members of the Permanent Defence Forces?
Credit is being given for members of the Permanent Defence Forces provided the person becomes an insured person on, or after, 1 September 2018 and within 9 months of ending their membership.
24. What rules apply to former members of the Joint Sickness Insurance Scheme of the European Union?
Credit is being given for members of the Joint Sickness Insurance Scheme of the European Union provided the person becomes an insured person on, or after, 1 September 2018 and within 9 months of ending their membership.
I am 45 year old and I am taking out health insurance for the first time on or after 1 May 2015. My community rating premium (after tax relief) is @1,000 per annum. What premium shall I pay including the lifetime community rating loading?
The annual premium is €1,000 plus €200 tax relief €1,200
The loading is 22% of the gross premium of €1,200 €264
Gross premium including Lifetime Community Rating loading €1,464
Tax relief of 20% gross premium limited to €200 €200
Amount Payable €1,264