Competition in the Irish Private Health Insurance Market

its PHI products were broken, such that consumers could keep their
multi-trip travel insurance if they switched to another PHI provider.
6.54 The Financial Regulator’s Consumer Protection Code states that “A
regulated entity must not make the sale of a product or service
contingent on the consumer purchasing another product or service
from the regulated entity.” Vhi Healthcare is subject to this code as an
intermediary (on which basis it sells travel insurance policies) but not
as an insurer (on which basis it sells the policies on which the sale of
travel insurance is contingent). The Authority has raised this matter
with the Financial Regulator and intends to discuss it further with them
in the near future in order to determine whether Vhi Healthcare is
acting in breach of the Code.
6.55 If Vhi Healthcare is acting in breach of the Financial Regulator’s Code
of Conduct by making the sale of travel insurance contingent on the
sale of other products that it provides then Vhi Healthcare should alter
its practices in order to comply with the Code.
6.56 However, it may be that Vhi Healthcare is not in breach of the code
because it is not regulated by the Financial Regulator as a provider of
private health insurance. If this is the case it constitutes an advantage
for Vhi Healthcare as a result of its particular regulatory position.
While the Authority recommends that Vhi Healthcare become subject
to regulation by the Financial Regulator as an insurer, this will take
some time. In the meantime Vhi Healthcare should operate in
accordance with the terms of the Financial Regulator’s Consumer
Protection Code when selling travel insurance.
Recommendation 12
Vhi Healthcare should comply with the Financial
Regulator’s Consumer Protection Code as if Vhi
Healthcare was a regulated entity of the Financial
Regulator.
Ministerial approval for products for sale by Vhi
Healthcare should only be given where it would not
lead to a breach of the Financial Regulator’s Consumer
Protection Code.
Action By
Vhi
Healthcare
and
Minister for
Health and
Children
6.57 Care needs to be taken in implementing this recommendation. If a
consumer ceases to hold a PHI policy with any PHI firm, but continues
to hold Vhi MultiTrip insurance, they will not be covered for the sum
originally insured under their PHI policy, and will be personally liable
for sums in this amount. Accordingly, consumers should be made
aware before cancelling their PHI policy that failure to secure another
PHI policy will leave them potentially liable to such expenses for the
remainder of the lifetime of their Vhi MultiTrip policy.
Minimum Benefit Regulations
6.58 The Minimum Benefits Regulations limit innovation and restrict
competition on the merits of product offerings by forcing PHI firms to
cover certain procedures and hospitals. However, the Minimum Benefit
99