On average, health insurance premiums are set to increase by 2.9%. It’s important to remember that 2.9% is an average only, with some policies set to increase by more than 2.9% and others less.
In Australia, the cost of providing quality health care continues to rise, largely due to our aging population and improvements to medical treatments and technology. Health insurance funds generally need to increase their private health insurance premiums to keep up with these rising costs. Each year, health funds seek approval from the Federal Government to increase the costs of their individual products.
No, this year health funds are increasing their premiums at different times, which may be confusing for some customers1.
Some funds have announced that they are increasing their prices on 1 April 2023, whilst others have announced their premiums are increasing later in 2023 including:
If your fund is planning to increase your premium in 2023, they are required to let you know in advance and tell you exactly how much you will be paying from that date.
Keep in mind that most funds no longer advise policy holders of prices increases via letter. These days most communicate via email. This can be easy to miss so make sure you check your junk mail.
Make sure you pay attention to any communication you receive from your health fund and if you aren’t sure, give them a call. If you are notified that your premium is set to increase, this should be your prompt to review your policy to make sure you are still happy with it.
The amount that a fund is increasing their premiums by aren’t uniform, that’s why it is so important to check if your premium is set to increase, and if so, by exactly how much. Armed with that information, you should take the time to compare your current policy against other options to see whether you may be able to find better value.
You may be able to find a policy offering a similar level of cover for a cheaper price with a different fund.
Alternatively, you may be able to find a different policy that offers better value for the same price. Or it may be time to make some changes to your current policy to better suit it to your current health needs and budget, such as removing cover for things you no longer need or increasing your excess.
If you are in a position to do so, pre-paying your annual premium upfront for a full year before your premium rise takes effect will lock in your current rate for another 12 months.
Also keep in mind that if you are struggling to pay your premiums due to financial pressures, you may be eligible for hardship support with your current fund. In many cases hardship support means you cannot use your cover but keep your waiting periods so it’s a good idea to speak directly to your fund about what help may be available.
Many Aussies may be under increased financial pressure right now so it is understandable that many policy holders may be questioning the value of private health insurance. But if the last few years has taught us anything, it’s just how important our health, and health system, really is.
With elective surgery waiting lists in some states blowing out due to the coronavirus backlog, the peace of mind and greater choice that private cover provides is arguably more valuable than ever.
If you are struggling to justify the cost of private cover, look to switch before you ditch. It is important to remember that if you cancel your hospital cover entirely and then want to re-join down the track, you will have to re-serve waiting periods and, depending on your age, may be stung with higher premiums due to Lifetime Health Cover (LHC) loading.
Rather than simply cancelling, first explore whether there may be a more affordable option available through either switching to a different fund or making changes to your policy. You could decide to increase your excess, drop your extras or even temporarily downgrade your level of hospital cover to keep costs down. Just make sure you are fully aware of what you are no longer covered for so you aren’t caught out should you need to make a claim.
Every dollar counts at the moment! And switching is generally a lot easier than many people realise. That’s where iSelect can help. In one simple phone call, iSelect’s trained health insurance consultants can help you compare your current policy against other options from our range of providers to see if you could get better value. If you do decide to switch, they can help you take care of the process, saving you time, effort and hopefully money!
A lot of people are put off switching because they mistakenly assume they will have to re-serve hospital benefit waiting periods. The good news is that simply isn’t true. Any hospital or extras waiting periods you’ve already served will be protected by law as long as you switch to a lower or equal level of cover.