Laya Laya Healthcare - Same net figure but different gross figure on same policy?

[Grizzly]

Both myself and my wife have separate policies with Laya Healthcare. Both are Healthwise Plus no Excess. We both got our renewal notices last month and the Net figure we both have to pay is €1003.59. After the recent budget I became interested in the Gross Payment figure only to find that we both had different Gross amounts. Mine is €1679.49 and my wife's is €1529.49. How can we both have the same net figure but a different gross figure?
Also when grossing up a figure from a net figure based on the tax reliefs allowed how can the differences be as high as €673 in my case. I thought that the tax relief was circa 20% which should suggest that the gross figure should be circa €1200?

 

[STEINER]

Where are you getting the gross figures from? On my Laya document the subscription is exactly 80% of their gross figure.

 

[BazzaDP]

I'm guess you are both aged 60-64?

Your gross premium is €1003.59 / 80 * 100 = €1254.49 - similar to what you estimated it would be.

However the government tops up Advanced policies with €425 for men aged 60-64, and €275 for woman as part of risk equalisation. This brings it to €1679.49 for you and €1529.49 for your wife.

This is done to offset the fact that the insurance company legally has to offer you both the same price as everyone else despite the fact that, statistically speaking, older people are riskier to insure than younger people and also that men are riskier to insure than women.

This is the plus side of the government levy applied to every health insurance policy sold. Without it older people would have to pay more. Though to be honest, as you are paying €350 each on the levy as part of your policy (so €700 in total) and benefiting €425 + €275 = €700 you are neither gaining or losing here. Younger people will be net losers on this as they pay the levy but get no benefit, and people over 65 will be net benefiters.

More details here: http://www.hia.ie/regulation/risk-equalisation/

 

[Grizzly]

Thanks Bazza. That's very interesting if still a little confusing. I think that the insurance companies should give us a breakdown of the figures on each quote/renewal. If the government plays around with the tax element in future budgets will the net figure for both of us always remain the same or will men and women of a certain age (60 to 64) start seeing a difference in premiums on the same policies?

 

[BazzaDP]

Depends what playing they do!

Assuming you're new policy did not start before 16th October, the renewal amount is now wrong and will be an extra €54.49 each this year for each of you thanks to the changes in this budget. In my opinion it would have been better to give some notice of the tax relief changes instead of just announcing them one afternoon to take effect the next morning, when renewal notices like yours had already been sent out!

 

[Grizzly]

Well if I purchase 280 x 2 litres of milk in Aldi or Lidl, I will save about €112 on this purchase compared to purchasing them in most other outlets. Great to see that my effort in doing this will go straight to the government coffers!