Implications of the capping of tax relief on health insurance premia

The_Conductor

Hi Guys,

Just thought I'd throw it out there- what impact is the capping of tax relief on insurance premia likely to have on us?

Essentially- where previously you got relief @ 20% on your health insurance- now its capped at the first 1000 Euro.

The VHI are advising that over 90% of policies are going to see increases- on average of amost 400 a year for lower coverage plans- all the way up to almost 2k more for old scheme D/E plans.

I can't see this ending well for any of us. Irrespective of how its implemented- it looks likey that more and more of us are going to be forced to jettison our heath cover........

DoesNotCompute

The_Conductor wrote: »

Hi Guys,

Just thought I'd throw it out there- what impact is the capping of tax relief on insurance premia likely to have on us?

Essentially- where previously you got relief @ 20% on your health insurance- now its capped at the first 1000 Euro.

The VHI are advising that over 90% of policies are going to see increases- on average of amost 400 a year for lower coverage plans- all the way up to almost 2k more for old scheme D/E plans.

I can't see this ending well for any of us. Irrespective of how its implemented- it looks likey that more and more of us are going to be forced to jettison our heath cover........

My understanding is that it will be capped at 1000 per adult , and at 500 per child. So a married couple with 3 kids would be capped at (2 x 1000) + (3 x 500) = 3500 - a fairly hefty amount for an insurance policy.

Also there is a price war imminent as all the major health providers are about to provide a range of new "corporate plans", which they are obliged to sell to you by law. This will offset or negate the decrease in tax relief.

Source: http://www.independent.ie/business/personal-finance/latest-news/600-savings-on-offer-in-health-cover-price-war-29657249.html

iptba

DoesNotCompute wrote: »

My understanding is that it will be capped at 1000 per adult , and at 500 per child. So a married couple with 3 kids would be capped at (2 x 1000) + (3 x 500) = 3500 - a fairly hefty amount for an insurance policy.

Also there is a price war imminent as all the major health providers are about to provide a range of new "corporate plans", which they are obliged to sell to you by law. This will offset or negate the decrease in tax relief.

Source: http://www.independent.ie/business/personal-finance/latest-news/600-savings-on-offer-in-health-cover-price-war-29657249.html

E1000 might be a "hefty amount" but a lot of policies are costing a lot more following recent budgets.

Fingers crossed about the price war you mentioned.

Bakemate

The papers are printing their usual rubbish. There will be no price war. I can't count how many times I've read in the paper that there was going to be a price war in insurance and it never materialised. The company plans they were talking about have already been released in dribs and drabs over the course of this year and none of them are anything to write home about. I think there's four more due from Aviva and another two due from Vhi.

http://www.hia.ie/latest-news/latest-news/

The tax relief reduction is being applied on the gross premium, so you still get 20% on the first €1000 gross but not on anything over that, so policies under €1000 net may still have price increases.