Competition in the Irish Private Health Insurance Market

4.41 In the regulatory approval process, the main substantive issue is that
an amount of time and effort may be required to ensure that the
proposed products and processes of a new entrant conform to the
health insurance legislation. In accordance with its functions, The
Health Insurance Authority monitors the operation of the Acts in this
regard and maintains the Register of private health insurers.
4.42 All insurers are treated equally under the health insurance legislation.
Vhi Healthcare and BUPA Ireland’s participation in the market predated
the establishment of the Authority. However, their products were
reviewed by the Authority after it was established for compliance with
the legislation.
Role of the Health Insurance Authority
4.43 As part of the joint consultation process, submissions were invited on
“duties that could be assigned to the Health Insurance Authority under
existing legislative provisions and additional functions that might
possibly be assigned to The Health Insurance Authority.” A number of
respondents made suggestions as to the role and structure of the
Health Insurance Authority.
4.44 Four respondents suggested either that the Authority should be
abolished and its functions taken over by the Financial Regulator, or
that the Authority be subsumed into the Financial Regulator. Two main
justifications for this course of action were proposed:
• Reduce the regulatory burden on PHI firms
• End the Minister for Health and Children’s dual role as the
responsible Minister for both Vhi Healthcare and the Authority.
Reduce the regulatory burden on PHI firms
4.45 A number of submissions stated that the existence of two regulators
(the Health Insurance Authority and the Financial Regulator) in the PHI
industry was needlessly onerous and led to increased costs of
compliance. It was argued that a single regulator for PHI would reduce
compliance costs and facilitate market entry.
4.46 The regulatory burden on insurers should be no greater than is
necessary. PHI firms (apart from Vhi Healthcare) are subject to
regulation by the Financial Regulator in relation to corporate
governance, prudential and solvency requirements, and customer care.
PHI firms are also required to comply with the Health Insurance Acts
and associated Regulations. Compliance with these Acts and
Regulations is monitored by the Health Insurance Authority.
4.47 A single regulator would imply a single regulatory authorisation process
and ongoing regulation by just one entity. However, the evidence
would not suggest that there are extra costs being incurred by
registered entities by virtue of the existence of two regulators in this
sector. In particular, the process of registering a health insurance
undertaking is a very simple and straightforward one and insurers
would be required to comply with the requirements of both the health
insurance and other insurance legislation regardless of whether there
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