Age-Based Discounts for Young Adults

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What is the age-based discount?

What age-based discount could I get?

How much could I save on hospital cover?

How are age-based discounts calculated?

How do age-based discounts work for couples and families?

Are insurers required to offer age-based discounts?

Can I keep my discount if I change my health fund or policy?

Where can I find and compare hospital cover?

Long story short

Young Australians can snag a tidy discount on hospital cover

If you’re aged 18 to 29, you could slash up to 10% off your hospital premiums.

The earlier you jump on board, the bigger the potential savings

Savvy young Aussies can lock in the maximum 10% discount before age 26, because the discount drops by 2% for every year you wait after that.

Discounts stick around until you hit your forties

You keep your age-based discount until you turn 41, meaning you could save thousands over the life of the policy.

Couples can average out their discounts for a shared win

If you’re loved up on a joint couples policy, your individual discounts are averaged out to calculate the total premium reduction.

What is the age-based discount?

If you’re under 30 when you take out eligible hospital cover, you can get an age-based discount. It knocks 2% off your premium for every year you are under 30, up to a maximum of 10% for 18- to 25-year-olds.

This discount came out of the Australian Government’s health insurance reforms, which allowed funds to offer tiered discounts to encourage younger people – specifically those aged 18 to 29 – to take out hospital cover earlier.

But if you’re still sitting pretty on your family or single parent’s insurance plan (as a dependant) and you’re in the 18-29 age bracket, sorry, you’re not getting in on this. It’s strictly for those holding their own hospital policy.

Whether you’re a seasoned policyholder or just jumping on the insurance train, if your provider of choice offers these age-based discounts, you’re in luck! They’re throwing them out there for both the OGs and the newcomers.

Here’s an important call-out: age-based discounts only apply to hospital insurance – not extras cover. So this means if you have a combined hospital and extras policy, the discount will only apply to the hospital component of your cover.

What age-based discount could I get?

The discount on private hospital cover depends on the person’s age. So if you’re on a singles policy, this is what it could look like:

Source: Privatehealth.gov.au – Age-based discount

If you’re on a couples or family policy, you can work out your discount by taking the average of the two adults’ individual discounts. (This excludes any dependent children or adult dependants on the policy.) So, for example, if one adult has an 8% discount and the other has 4%, the couples policy ends up with a total discount of 6%.

How much could I save on hospital cover?

Alright, picture this – you’re 18 years old, just adulting your way into the world. You decide to grab this slick insurance policy deal that starts showering you with discounts on your private health insurance premiums.

So, let’s break it down. You snag a 10% discount on your premiums every year until you hit 41 years of age. That’s more than a decade of savings! Meanwhile, your buddy, who’s still contemplating adulthood and hasn’t hopped on this policy bandwagon, is missing out.

How are age-based discounts calculated?

A person’s eligibility for the age‑based discount depends on something called their discount assessment date. This date is important because it determines exactly how much of a discount they get.

Your discount assessment date can be worked out in one of three ways:

• It could be based on when you first joined a policy that offers an age‑based discount.
• If your own policy started offering age‑based discounts after you’d already joined, your assessment date becomes the day you first became eligible for the discount.
• If you switch to another policy that keeps your existing age‑based discount (also called ‘retained age-based discount’), your original assessment date carries over to the new policy.

The age-based discount is worked out using your base premium, which is the cost of your cover before any other adjustments are made. So it’s calculated before things like the Australian Government Rebate, Lifetime Health Cover (LHC) loading, or any other applicable discounts.

How do age-based discounts work for couples and families?

Suppose you’re rolling with your plus one on your insurance journey. If you and your partner are eligible for individual discounts, they don’t just add them up and call it a day. Nope, it’s an average game. Let’s say you’re rocking a solid 10% discount, and your partner’s cruising with a respectable 6% discount. They crunch the numbers, and voila – your power couple discount is a smooth 8%.¹Private Health – Age Based Discount

This applies to a family policy, too.

Now, let’s say you have an aged-based discount, but your partner has a Lifetime Health Cover (LHC) loading. Each discount or loading is applied only to the part of the hospital cover that relates to each person. So with a couples policy, the insurer usually splits the hospital premium in half – your discount applies to your half, and the LHC loading applies to your partner’s half.

If you want the most accurate price for your situation, you can talk to our friendly health insurance comparison experts!

Are insurers required to offer age-based discounts?

No one’s cracking the whip on health funds, forcing them to hand out those age-based discounts. It’s not a must-do, but guess what? A bunch of them actually do it anyway to help attract younger customers.

Loads of insurers are on board with the idea. So, while it’s not carved in stone, you should be able to find an insurer who’s all about those age-based discounts.

If you’re an existing member to A health fund that offers it and you fit the eligibility criteria, then the age-based discount will be automatically applied to your policy.

Helpful tip

A discount isn’t the only reason you might want to consider Health Insurance while you’re young, fit and healthy. Lots of funds offer some impressive perks, like discounts on gym memberships and rewards programs where you can snag some pretty great gifts and gadgets.

Dr. Jill Gamberg

GP, Coach, and Lifestyle Medicine Physician

Can I keep my discount if I change my health fund or policy?

If you’re thinking of jumping ship to a new insurer or switching up your policy game, it’s like this: the discount you’re rocking from your previous insurer might still come along for the ride, but you’ll have to play detective and ask your future insurer.

Before you make any moves, hit your potential new fund up and ask straight out if your discount will stick with the new plan. Insurers have the power to decide if they’ll keep honouring that age-based discount when you make the switch. Some health funds have what’s called a ‘retained age-based discount’ policy.

It’s their call – some might be cool and let it ride, while others might be a bit more picky. So be in the know before you make the move and make sure your discount doesn’t get left behind in the insurance shuffle.

The good news is just like your age-based discount getting carried over to the new policy, so does your waiting periods, too. There’s no need to miss out on hospital benefits if you’ve already served your waiting periods from your previous health fund. However, new members or those who have upgraded to a higher level of cover must still wait 12 months to access hospital benefits if they have pre-existing conditions (and two months for new conditions or those needing psychiatric, rehabilitation and palliative care.)

Where can I find and compare hospital cover?

At iSelect, we’ve made the whole health insurance game as easy as a Sunday morning. No need for a headache-inducing search – it’s just a few clicks to find a policy that suits your needs and budget. Compare health insurance policies like a pro so you can see what’s what.

If you’re not the online type, no worries. Give us a shout at 1800 784 772. Our crew of health insurance comparison experts is standing by, ready to chat about your health insurance needs and help you understand your eligible discounts.