Lifetime Community Rating (LCR)

Do you know what Lifetime Community Rating is and How it Will Affect You?

Lifetime Community Rating (LCR)Lifetime Community Rating (LCR) was introduced into legislation on 1st May 2015 and affects anyone over the age of 34 years taking out health insurance for the first time after this date. From 1st May 2015, a loading will be applied to all health insurance policies taken out for the first time by individuals 35 years and over, at a rate of between 2% – 70% of the premium.

Here are a few facts about the new LCR

What principles currently underpin the Private Health Insurance market?

In Ireland, everybody is charged the same premium for a particular health insurance plan, irrespective of their age, gender and the current or likely future state of their health. This is called community rating.

What is Lifetime Community Rating (LCR)?

Under LCR, community rating is modified to reflect the age at which a person takes out private health insurance. Late entry loadings are applied to the premiums of those who join the health insurance market at age 35 or over. If you take out private health insurance earlier in life, and retain it, you will pay lower premiums compared to someone who joins when they are older.

How are the loadings calculated?

From the 1 May 2015, if you are purchasing a private health insurance policy for the first time at age 35 years or older you will pay a 2% loading on top of your base premium for every year you are aged over 34. For example, if you take out a private health insurance policy for the first time at age 40 you will pay 12% more than someone who took out their cover before the grace period expired.

Are there any exemptions from lifetime community rating loading?

Yes. Everyone who has health insurance at the end of the grace period (30th April 2015) will be assumed to have a continuous period of cover and therefore no LCR loadings will apply.

If I had private health insurance previously, but let it lapse, do I still have to pay the loadings?

Yes, the level of loading will be reduced by the number of previous years health insurance cover. Please note that written documentation of previous cover will have to supplied by your previous insurer in order to avail of this discount.

Is the LCR loading be applicable on my policy forever?

No, the LCR loading will last 10 years, so our best advice is to take out cover as soon as you can to avoid any initial penalties increasing as you get older.

Can an insurer make an exemption for me from the LCR loading?

The application of loadings will be mandatory and cannot be waived by an insurer.

To find out more or make an appointment to meet with our Health Insurance experts please email or call Colette O’Donohue, Ann Daly or Alan Cleary on 021 4279999 and they will be happy to assist you, answer any queries and recommend the next step suitable for your particular needs.