Private health insurance premiums increased sharply last year despite many policyholders receiving reduced levels of cover, according to new figures published by Ireland’s health insurance watchdog.
The latest annual report from the Health Insurance Authority (HIA) found that average health insurance costs rose by 10.6 per cent in 2025, while an increasing number of plans restricted benefits for common orthopaedic procedures, including hip and knee replacement surgeries.
The regulator said insurers appear to be reducing orthopaedic cover on plans frequently held by older customers, leaving many policyholders exposed to potentially significant out-of-pocket medical expenses.
More than 70 per cent of insured consumers were enrolled in plans with restricted orthopaedic benefits last year, up from 68 per cent the previous year and nearly 10 percentage points higher than four years ago. The HIA noted that these reductions in cover were often introduced alongside premium increases.
The changes mean that patients requiring major orthopaedic treatments may find that their insurance no longer covers the full cost of procedures, despite paying higher annual premiums.
Nevertheless, demand for private health insurance continued to grow. By the end of 2025, approximately 2.55 million people in Ireland held private health insurance policies, representing an increase of 1.2 per cent compared with the previous year.
Almost 46 per cent of the population now has private health cover, with the HIA suggesting that rising costs are pushing many consumers towards cheaper plans offering fewer benefits.
“Our research clearly points to a shift in the type of cover people are opting for,” said HIA chief executive Brian Lee.
“While more people than ever have health insurance, many consumers are on plans that do not fully cover some of the most common and costly procedures.”
Lee urged consumers to carefully review the details of their policies to ensure they understand any limitations in cover.
“Choosing a health insurance plan is not simply just about the price; it is about understanding what level of cover is involved, what you need most and what is not covered as part of your plan,” he said.
“We urge people to consider their health needs when selecting a plan and balance this with cost. Our comparison tool on our website, which helps you compare plans based on your health needs, is a great place to source relevant, current information on your plan and options available.”
The report also highlighted a growing number of consumers paying a Lifetime Community Rating (LCR) loading. The proportion of policyholders subject to the surcharge increased to 5.7 per cent last year, compared with 4.9 per cent in 2024.
The LCR system is designed to encourage people to take out health insurance at a younger age and maintain continuous cover. Individuals who first purchase health insurance after the age of 34, or who experience a break in cover, can face higher premiums as a result.
“Lifetime community rating is a fundamental part of how the Irish health insurance system works,” Lee said.
“It supports fairness across generations by encouraging people to take out cover earlier and keep it in place over time. Our report shows a gradual increase in the number of people affected by lifetime community rating.”
He added that the surcharge can have a significant financial impact and stressed the importance of understanding the rules before cancelling a policy, returning to Ireland, or taking out health insurance for the first time.
“Whether people are taking out insurance for the first time, returning to Ireland or considering cancelling their cover, it is important to understand how lifetime community rating may apply to them,” Lee said.
