VHI profits surge 17% to almost €53m as health insurance claims tumble

Profits at State-owned health insurer VHI grew 17 per cent to almost €53 million last year as claims tumbled in the face of Covid-19’s impact on hospitals.

VHI said on Wednesday that growth in the number of customers it recruited last year helped to boost sales to €1.5 billion from €1.4 billion in 2019.

Its after-tax net surplus grew 16.9 per cent in 2020 to €52.7 million from €45.1 million the previous year, the State company’s accounts show.

VHI paid out €1.147 billion in claims on its policies last year, 17 per cent less than the €1.387 million claimed by customers in 2019.

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Public hospitals prioritised Covid-19 sufferers last year, while the State took over private facilities for a period to aid its efforts to combat the virus, leaving less scope to treat insured patients.

Consequently the health insurer faced fewer claims on its policies. VHI returned €265 million to customers in premium waivers through 2020.

VHI recruited 3,900 more customers last year, bringing total private health insurance membership to 1,131,900.

Free reserves, held to ensure it could meet potential claims on its policies, grew to €773 million from €701 million, the company said.

John O’Dwyer, VHI chief executive, described the performance as solid, with increases in sales and customer numbers.

Uncertainty

“While there is much uncertainty about the short-, medium- and long-term impact of Covid-19 on the healthcare sector generally there are a number of positives that can be drawn from the experience of the past year,” he added.

Mr O’Dwyer predicted that changes such as telephone and remote consultations with doctors, introduced to counter Covid restrictions, could remain a part of healthcare in the future.

The company switched its Swiftcare clinics, for patients with minor injuries and illnesses, from walk-in to appointment only, based on an initial phone call to establish customers’ likely needs.

VHI blamed Covid-19 travel bans for a fall in sales of services other than health cover.

Income from insurance slipped to €28.6 million in 2020 from €34.5 million in 2019.

The State company said this was mainly due to a fall in demand for travel cover that resulted from restrictions.

VHI extended cover for those with multi-trip insurance at no cost, while it waived premiums for dental customers.

The State-owned health insurer said that it responded to the Covid crisis in a rapid, measured and effective way last year.