VHI may seek to sell British firm's products here

THE VHI is considering linking with a British healthcare company under which the VHI would sell some of the British company's products in Ireland.

Discussions have already taken place with the British company, PPP. The marketing link is one of the avenues being examined by the VHI board as a way of introducing new products to the Irish market. It is believed VHI may also have contacted other major health insurers.

PPP, which is next in size to BUPA in Britain, is not thought to be interested in establishing a full scale operation in Ireland.

BUPA is negotiating with the Department of Health to get clearance for its product line, with the discussions centring on whether its products breach community rating regulations under which people are charged the same for health insurance no matter what their age.

There is support on the VHI board for looking at how it could develop its service range through co operation with overseas health insurers.

But sources said reports that the board was about to ask the Department for clearance to negotiate a strategic alliance, under which another insurer would buy a stake in the VHI, are incorrect. There does appear to be some board support for examining this course, but no proposals are under discussion.

VHI's main attraction from the point of view of other insurers is its 1.4 million client list. A report drawn up for the Department in 1994 by a committee chaired by former Aer Lingus managing director, Dr David Kennedy, said the company should look at joint ventures with other insurance companies and with brokers.