Compare Health Policies Before April Premium Rise

Australians are facing higher private health insurance costs, as average premiums jump 3.7% from April 1 - with some policies increasing as much as 9.5%. While these hikes aim to support system sustainability, they risk pushing households already feeling cost-of-living pressure to drop or rethink their coverage entirely.

Although recent budget changes relieved pressure on bulk billing and PBS medication costs, private health cover received no adjustments. Private cover still carries a stigma of being expensive and under-utilised. With most families spending between $5,000 and $7,000 annually and only 18% claiming regularly, there’s growing concern over value for money.

Not all policies are created equal. While some insurers cover nearly 100% of costs for key services, others return as little as 30 cents on the dollar. Policy differences also include grouped or separate limits for allied services like physio and chiro, and lifetime caps on expensive treatments like orthodontics or major dental - making it crucial to read the fine print before choosing or renewing a plan.

Some insurers also let you pre-pay premiums before April 1 to lock in current pricing for up to 18 months, which could save hundreds over time. High income earners might also use basic hospital policies, not for the coverage, but to avoid the 1-1.5% Medicare Levy Surcharge. Those earning above $97,001 (singles) or $194,001 (families) are affected, with extra charges rising as income increases.

Lifetime Health Cover loading is another reason not to delay. If you don’t hold hospital insurance by July 1 after turning 31, an additional 2% annual loading applies for each year it’s delayed - for the next 10 years. Even if not used frequently, a $1,000-$2,000 annual premium plan could be more cost-efficient than paying more taxes or loading fees.

For extras, the key is matching your needs with the policy's benefits. The biggest errors come from holding cover that doesn’t align with the services you actually use. A better approach is to list your most-used health services - whether that’s optical, physio, or dental - and compare policies across 30 insurers using an independent, government-backed tool at privatehealth.gov.au.

With dozens of similar-sounding policies, it’s worth crafting a shortlist based on benefits that matter to you, comparing fine print directly from each insurer’s website. A simple spreadsheet can help map differences in rebates, claim limits, and exclusions. Now’s the right time to optimise your health insurance strategy, before premium increases take effect.

Source: The Australian, NIB, Bupa, SBS