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Is it time to kiss your parent’s health insurance policy goodbye?
There comes a time in your life when you finally have to break free … from your family health insurance policy, that is. Even if you still live with your parents, you may not be able to piggy-back off their policy when you reach a certain age.
According to recent research1, 17% of Millennials are still covered under their parents’ health insurance policies. But it won’t be long before these guys – the youngest of whom would be about 17 in 2017 – have to think about going it alone.
So when, exactly, do you have to get off your family health insurance policy?
It all depends on your family health fund’s definition of a dependant. Some funds are more forgiving than others, giving you a few extra years to enjoy the protection of your parents’ policy. Others encourage you to leave the nest earlier, and offer great basic protection for youngsters like you while you find your feet.
Here are the most common criteria for kicking you out:
- Turning 21 and not studying full-time – in most funds, you are no longer classified as a ‘child dependant’ when you celebrate your 21st. If you’re not studying full-time, then most funds will politely ask you to leave (note: some funds allow you to remain as an ‘adult dependant’ until you turn 25, even if you’re not studying).
- Turning 25 – you may have been on your parents’ policy as a ‘student dependant’ for the last four years, and you may still be studying full-time. But once you turn 25, it can be goodbye to family health insurance, no matter what.
- Full-time employment – if you’re still young, but have entered the workforce, then some health funds no longer see you as being ‘dependant’. So you’re out.
- Marriage – ditto with marriage. Once you say ‘I do’, you’re no longer dependant on your parents. Instead, you and your new partner may need to work out your health insurance on your own.
Remember, every fund has its own rules and cut-off ages. Make sure you’re clear on the rules relating to your family health insurance policy early on, so you’ve got plenty of time to formulate a plan of attack for getting your own health insurance.
You’re on your own. Now what?
Just because you’re no longer able to use your parents’ policy (thanks, Mum and Dad!), it doesn’t mean you should forget about health insurance altogether.
In fact, the smartest thing you can do is switch straight into your own policy. Look for a policy that suits young people like you – it certainly wouldn’t make sense to pay for things like hip replacements or cataract surgery right now, would it?
There are plenty of very affordable health insurance policies on the market that give you the benefits of health insurance without causing a big dent in your weekly budget.
A great place to start is to compare a few funds side-by-side to give you an idea of what your options are. The iSelect health insurance comparison tool makes this job easy – or, you can simply call us on 13 19 20 to get started.
1. PHI Premium Increases, Galaxy Research, February 2017
Any advice provided in this content is of a general nature and does not take into account your objectives, financial situation or needs. You need to consider the appropriateness of any information or general advice we give you, having regard to your personal situation, before acting on our advice or purchasing any product. iSelect does not compare all products in the market. Not all products are available at all times.