THE INSURANCE CONUNDRUM
Returning emigrants pay a high price for time spent abroad,
RETURNING emigrants are facing a financial minefield when they come back to Ireland — and the prospect of being out of pocket to the tune of thousands of euro, or more, a year. As well as having to find an affordable place to live in the midst of a housing crisis, Irish expats could have to pay much more for insurance when they return home than they would have if they had never left. They could also face an uphill battle for social welfare.
HEALTH INSURANCE
Returning emigrants could pay thousands of euro more a year for private health insurance than they need to — if they don’t take it out within nine months of their return. This is because most of those over the age of 34 who take out private health insurance today for the first time are hit with loadings on their premium. The loadings are applied at a rate of 2pc a year for each year that an individual is over the age of 34. The loading could be as much as 70pc if you’re aged 69 or older — and are buying health insurance for the first time.
Returning emigrants can escape the loadings if they buy private health insurance within nine months of their return — depending on when exactly they left Ireland, and when they returned. For example, if you left Ireland to work abroad before May 1, 2015, and you have since returned to Ireland, you are exempt from the loadings if you have never bought private health insurance before — but only if you buy the insurance within nine months of your return.
“There are a lot of returning emigrants who are not aware of this, and who have missed the ninemonth window — and who face the full loading as a result,” said Dermot Goode, health insurance expert with totalhealthcover.ie.
Anyone who left Ireland after May 1, 2015, and who has since returned home, might escape or avoid the full force of the loadings — depending on when they returned home. People who left after May 1, 2015, who then returned before November 1, 2018, and who never had private health insurance before, typically face the full force of the loadings. However, people who left after May 1, 2015 and who returned on or after November 1, 2018 can get a credit for the time spent outside Ireland — as long as they buy private health insurance within nine months of their return.
“In some cases, the credit could wipe out the loadings, depending on your age,” said Goode.
Even if the loadings are not wiped out, the credit should reduce the loadings — and make your private health insurance a bit more affordable.
“Let’s say you emigrated after May 1, 2015 — and you plan to return home in the summer of 2020,” said Goode. “You’ll be 44 years old when you return and you have never bought private health insurance before. Normally, you’d face a loading of 20pc if buying insurance for the first time at that age. However, as you will have been away for five years, you’ll be entitled to a credit of five years — which will reduce your loading to 10pc.”
As you could be paying loadings for up to 10 years, it’s vital that returning emigrants buy the cover within nine months of their return — if they’re entitled to a loading exemption or credit. “The legislation around loadings is currently under review and may change, so it’s worth checking the position on loadings in advance of your return home,” said Goode.
Returning emigrants must also grapple with the thorn of insurance waiting periods — which typically require new customers to have Irish private health insurance for a certain amount of time before they’re covered. Those who have been diagnosed with a serious illness such as cancer when abroad, for example, and who then return home, could face a five-year wait before their private health insurance will cover them here.
DENTAL & EYE FREEBIE
Returning emigrants may have to wait up to five years before they’re entitled to the free dental check up or free eye test available under the State’s Treatment Benefit Scheme — depending on the country they emigrated to. Irish workers are entitled to a certain amount of free dental and eye care under that scheme, including the cost of a dental scale and polish once a year (as long as treatment costs no more than €42) and the cost of a pair of glasses once every two years (as long as they have basic frames and are a certain type).
However, to be eligible for these benefits, you must have paid a certain type and amount of PRSI (Pay Related Social Insurance) — and that PRSI must also have been paid in particular years. For example, those aged between 25 and 65 must usually have paid at least 260 PRSI contributions in Ireland to qualify for the benefits — and 39 of these contributions must have been paid two years before the year that a benefit is being claimed. You must usually be working for five years to build up 260 PRSI contributions.
Irish people who are returning home after emigrating to the EU may still qualify for benefits under the Treatment Benefit Scheme — because social insurance contributions paid in other EU countries can count towards one’s eligibility for the benefits. Even if you have paid enough social insurance when in the EU, to be able to take up the scheme after your return to Ireland, you must have started to work in Ireland since your return — and have paid at least one PRSI contribution.
Irish people who are returning home after emigrating to a country outside the EU (such as Australia, New Zealand or the US) are at a disadvantage here though — any social insurance paid outside the EU doesn’t count towards the Treatment Benefit Scheme. “Social insurance contributions paid in other non-EU countries which Ireland has reciprocal agreements with can be used to qualify for long-term benefits (such as pensions), but are not reckonable for shortterm benefits such as Treatment Benefit,” said a spokesman for the Department of Employment Affairs and Social Protection (DEASP). Such returning emigrants could therefore face a fiveyear wait for Treatment Benefit.
SOCIAL WELFARE
Returning emigrants face delays and difficulties getting certain types of social welfare — such as child benefit, the carer’s allowance, the jobseeker’s allowance, the disability allowance, the one-parent family payment, and the non- contributory State pension. This is because habitual residence is one of the conditions which you must meet to be eligible for these social welfare payments — and it often isn’t as easy to prove habitual residence as people expect.
“Irish people returning home might think that as they are just coming home, they’re automatically habitually resident in Ireland,” said Karen McHugh, chief executive of Safe Home Ireland, which provides support to those returning or moving to Ireland. “But when it comes to meeting the habitual residence condition for social welfare payments, it’s not enough to be Irish. You must prove your connection with the State and that your intention is to continue to live here.”
Returning emigrants must also prove that they have “severed ties with the country they have left”, according to a spokesman for the DEASP. You could very easily run into stumbling blocks here. “You may have a bank account abroad which you haven’t closed,” said McHugh. “That doesn’t show that you have ceased all contact with the country you have left.”
Unless you have planned your return home and have all the paperwork in place to prove habitual residence, you could get refused certain social welfare payments, according to McHugh. Although you can appeal such a decision, it could take months — or even a year — for you to get your social welfare. “We know of a case where a carer came back from Europe to look after his uncle — and he had to wait a full year to get his carer’s allowance,” said McHugh.
Returning emigrants could even find it difficult to get a Personal Public Service Number (PPSN), according to McHugh. This is because you must usually provide proof of an Irish address when applying for a PPSN. You need a PPSN to claim State benefits, such as the free GP care for children under the age of six. You also need a PPSN to avoid getting hit for emergency tax.
To avoid such problems, returning emigrants should get advice from an organisation such as Safe Home Ireland or Crosscare before, or shortly after, they come home.