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Representation in Ireland
News article31 March 2022Representation in Ireland1 min read

State aid: Commission approves prolongation and modification of Irish risk equalisation scheme

The European Commission has approved, under EU State aid rules, the prolongation and modification of an existing Irish risk equalisation scheme to compensate insurers for the provision of private medical insurances.

Image with text "State Aid"

Under the scheme, private health insurers, whose customers have a higher risk profile than the market average, continue to obtain payments from a Risk Equalisation Fund. The Fund will be financed via a duty imposed on all private health insurers.

In practice, the state-owned insurer, VHI Insurance, is expected to be a net beneficiary of the scheme, while its competitors are expected to be net contributors.

The aim of the scheme is to ensure that access to health insurance is available to consumers of health services with no differentiation made between them based on for example health risk status, age or sex.

The existing scheme, approved in 2003 (N46/2003) and prolonged in 2009 (N582/2008), 2013 (SA.34515), 2016 (SA.41702) and 2020 (SA.58851), was set to expire on 31 March 2022.

Ireland notified the following modifications:

(i) the introduction of a ‘high cost claims pool', whereby the excess of claims over €50,000 will be reimbursed at 40%, while all other claims will continue to be reimbursed based on age of the insured person and the number of days/nights spent in a hospital;

(ii) an increase from 4.4% to 6% in the return on sales  made by the net beneficiary of the scheme on the basis of the sales of private health insurance services; and

(iii) the prolongation of the scheme until 31 March 2027.

The Commission assessed the proposed modifications under the EU State aid rules, and in particular the EU framework for State aid in the form of public service compensation. The Commission found that, following the modifications, the scheme remains in line with EU State aid rules. On this basis, the Commission approved the modifications and the prolongation of the scheme under EU State aid rules.

The non-confidential version of the decision will be made available under the case number SA.64337 in the State aid register on the Commission's competition website once any confidentiality issues have been resolved.


Publication date
31 March 2022
Representation in Ireland