Consumers look set to see more competition in the health insurance market with the backing by Aviva of a new joint venture led by former VHI boss Oliver Tattan.
Mr. Tattan has set up a company called Douglasdale with former Aviva and Irish Life Health boss, Jim Dowdall, and health entrepreneur Stephen Loughman.
Aviva has confirmed that subject to regulatory approval it has taken a 50% stake in the start-up health insurer which it is hoped will begin selling cover in the second half of this year.
“Aviva is delighted to support the set-up of an exciting new health insurance business in Ireland,” Declan O’Rourke, CEO of Aviva Insurance Ireland.
“This is great news for Irish consumers as it will provide greater choice and value.”
“This investment expands Aviva’s offering in Ireland to General, Life and Health Insurance and further demonstrates Aviva’s commitment to continue to grow in Ireland as a leading financial services provider.”
Aviva is not disclosing its investment in the venture.
A spokesperson said a trading name has not yet been chosen, nor has it been decided if it will be marketed in some form under the Aviva brand.
Mr. Tattan is an experienced entrepreneur and investor in the insurance and IT sectors, having previously founded VIVAS Health in 2004 and GloHealth in 2012
VIVAS Health was later purchased by Hibernian Group in 2008 and became Aviva Health after new owner Aviva rebranded it.
However, Aviva later sold it to Irish Life in 2016, the same year as Irish Life also took full ownership of GloHealth, which it had previously bought a substantial share of.
The two businesses were merged to become what is now Irish Life Health.
Mr. Tattan also set up investment manager, Insurance Regulatory Capital, consumer network OneBigSwitch, and biometric identity manager Daon.
The arrival of a new entrant, which was first reported by The Phoenix, will bring fresh competition for consumers, who currently only have a choice of three main domestic insurers – VHI, Laya and Irish Life Health.
Before it can launch the provider will have to secure approval from both the Health Insurance Authority and the Central Bank.
Dermot Goode, from Totalhealthcover.ie, said the news was welcome for all consumers who are struggling with soaring health insurance costs and are finding themselves under financial pressure to maintain their health cover;
“Ultimately, there’s nothing like extra competition to drive better value for all consumers and employers,” he said.
“Any new entrant will need to build scale quickly, which will require both competitive pricing and enhanced benefits. This, in turn, will lead to a reaction from the existing insurers which hopefully will lead to better value for all insured and those considering joining.”
While Feargal McKenna, head of corporate at Moneycube.ie, said a shake-up in the market is overdue.
“Aviva’s move will inject new vigour into the health insurance landscape,” he said.
“For companies in Ireland, it offers the prospect of more attractive employee benefit offerings if Aviva can integrate it with other aspects of modern benefits packages such as pensions, protection, and wellness programs.”
