Going up: 4.6 million health insurance customers are missing out on potential savings
Millions of Australians could be missing out on health insurance savings, according to new research by Finder.
A recent Finder survey of 676 Australian health insurance customers has revealed that 41% of respondents haven’t done anything to save money on their policy.
With around 11.3 million Australians currently holding private health cover, that’s equivalent to 4.6 million people who could be missing out on saving.
This research comes as health insurance prices are set to increase by an average of 2.74% on 1 April, with some providers due to jump by as much 5.47%.
Finder analysis of the average price of policies shows that this could cost some members $112 more per year.
Taylor Blackburn, insurance expert at Finder, urged Aussies to get on the front foot and compare policies before that 1 April deadline creeps up.
“Now is the perfect time to reassess your health cover and lock in the best possible price before the April increase.
“Not all health funds are equal, particularly when it comes to price increases, so see what’s out there and leave the loyalty behind.
“Reviewing your level of cover, splitting your hospital and extras and looking at what other funds have to offer can all offer you potential savings on your premiums.”
On the other hand, more than half (59%) of health insurance customers have taken steps to save money on their policy.
Paying upfront for the year ahead (17%), regularly reviewing and adjusting their cover (16%) and regularly switching health insurers (12%) are some of the top ways that consumers are saving on their health insurance.
However, the most common way that Aussies have saved money is by going for the most basic policy. A quarter (24%) of those surveyed admitted to using this tactic.
Blackburn reminded Australians to consider their cover needs when looking for ways to save, rather than just looking at price alone.
“Choosing a more basic policy is one way to save money, but it won’t be the right fit for everyone and can leave you underinsured.
“Having health insurance is more than just a formality, it’s there to offer a financial buffer should you fall ill, so choosing the best policy for your needs is really important.
“There are more than 30 insurers in Australia offering thousands of policy options, so find the best one for your personal situation.”
|Which of these have you done to save money on your health insurance?|
|None of the above||41%|
|Go for the most basic policy||24%|
|Pay for the whole year upfront before 1 April||17%|
|Regularly review and adjust my cover||16%|
|Regularly switch health insurers||12%|
|Only get hospital cover||12%|
|Only get extras cover||9%|
|Take out a couples policy||4%|
|Split my hospital and extras cover between funds||2%|
Source: Finder February 2021 survey of 676 health insurance customers
|Tier||Average monthly cost||Average annual cost||Average yearly increase (+2.74%)||Highest yearly increase (+5.47%)|
Ways to save on your health insurance:
- Split your hospital and extras. Bundling cover can be convenient, but it isn’t always best for your wallet. Looking at hospital and extras cover separately will give you more choice and more opportunities to save.
- Increase your excess. Your excess is the amount that you will need to pay when you make a claim. Increasing this amount will lower the cost of your monthly premiums, which can save you money over the course of the year. If you choose to do this, make sure you are comfortable paying the higher amount should you need to make a claim.
- Ditch the couples policy. It may seem more convenient for you and your partner to share a policy, but it can actually end up costing you more. One reason for this is that both you and your partner need to be on the same level of cover even if only one of you is likely to need that level. For example, pregnancy cover is only available on the Gold tier so you will both be paying for Gold cover even though only one of you may actually need it.
- Compare your options. Regularly comparing policies and funds and switching when necessary will ensure that you are getting the best deal on your health insurance. Fortunately, if you’re switching to a similar level of cover, you often won’t have to re-serve waiting periods. The Finder app can also look at what you’re paying and suggest where you could switch and save money.
Visit Finder's Health Insurance hub to compare policies from 30+ health insurance brands in Australia.