Finding cheap health insurance shouldn't be complicated. That's why we've done the heavy lifting to source some of the cheapest policies in the country, analysing over 40 policies. Whether you're looking for the cheapest hospital cover or a cost-effective combined policy, we've got you covered.
The cost of private health insurance varies pretty wildly. You can find extras cover from just a few dollars a week, while basic hospital policies will cost you from around $18 per week. However, if you've got more complex health needs, you'll need to go up to a more expensive policy.
The price also rises every year. In 2026, the average premium increase is 4.46%, significantly higher than the previous year's average of 3.73%.
That's all very abstract - what are real Aussies paying for health insurance? Well, we ask hundreds of Australians that question every month in the Finder consumer sentiment tracker. Here's what their bill looked like in March 2026.
Extras only: $89
Basic Hospital: $145
Bronze Hospital: $200
Silver Hospital: $293
Gold Hospital: $359
Price based on 1,700+ responses for single hospital or extras insurance.
Cheap health insurance for tax
One of the big reasons Aussies take out health insurance is to avoid the financial impact of not having it. The government tries to strong arm you into getting private cover in a couple of ways, but there are 2 big ones.
Medicare Levy Surcharge (MLS): This is an extra tax that you'll pay if you're a high earner that doesn't have hospital cover. Currently the income threshold is $101,000 for singles or $202,000 for couples or families. Mind, this threshold includes super, so you'll likely cross it with a taxable income of around $88,000. The actual tax is between 1% and 1.5% of your total income.
Lifetime Health Cover loading (LHC): This kicks in from the tax year you turn 31. For every year after age 30 that you don't have hospital cover, a 2% loading will be added to the cost of health insurance when you eventually get it. For example, if you wait until age 40 to get cover, you'll pay an extra 20% on the base cost. If you wait until 50, you'll pay an extra 40%!
Avoiding the MLS and LHC with cheap hospital cover
The good news is that you are exempt from both of these extra costs if you take out even a cheap hospital insurance policy. Even a basic or bronze policy is enough - just not extras only. I generally recommend at least a bronze tier policy because it covers way more treatments for just a little bit extra, but you can pick what works best for you.
When is cheap health insurance worth it?
Whether health insurance is worth it is going to be different for everyone. However, there are a couple of reasons you might take out cheap health insurance, where it's definitely still worth considering.
To avoid tax impacts: We outlined these earlier in this article. Not having health insurance can make a big impact on your finances, but a cheap hospital policy can protect you.
For basic extras cover: If you just want cover for basic extras like dental, optical and physiotherapy, a cheap extras plan is just the ticket.
To cover some common treatments: If you don't reckon you need a super comprehensive policy, but you want private cover for some common treatments, you should at least have a look at some cheap bronze tier policies.
Basic vs bronze policies
It's important to know the difference between basic and bronze tier hospital policies. Basic policies are really bare bones. They often don't have any treatments fully covered, so you should consider them the same as not being covered. If you need a cheap policy, we'd recommend at least considering bronze policies. They only cost a little bit more, but offer way more actual coverage.
When is cheap health insurance not worth it?
Whether you're looking to avoid the MLS, you're about to turn 31 or simply keen to take out some basic cover, there are instances where cheap health insurance may not be worth the price tag, including:
It's not the right fit (yet):If you're a high earner who's already dodging the Medicare Levy Surcharge, or a fit and healthy 20-something who hasn't hit the Lifetime Health Cover deadline yet, a basic policy can make a lot of sense.
The real cost of 'cheap': If you're choosing a policy based on the cost alone, you might miss the fine print that'll hurt you later. Watch out for long waiting periods, low annual limits and exclusions that only show up when you need to make a claim.
Several exclusions: Most bare-bones policies won't cover things like major dental, optical, physiotherapy or anything requiring a hospital stay beyond the basics. If you're planning a family or have an existing condition, a basic policy won't help much.
How can I find cheaper health insurance?
No matter what your budget, these are some universal tips that could help you get more bang for your buck.
Drop unused extras: If you're paying for extras cover but can't remember the last time you made a claim, you're probably just subsidising other people's dental bills. Strip your policy back to what you actually use, or ditch it altogether.
Switch funds: A lot of people stay with a fund they've outgrown because they assume switching means starting from scratch, but it doesn't. Your waiting periods carry over when you move to an equivalent level of cover, so there's no real reason not to shop around.
Look for discounts. Lots of health funds run offers to attract new customers. This could be a reduced-price premium, free coverage for a few weeks or some other reward.
Pay before 1 April. Prices go up on 1 April every year. Pay in advance before this date and you'll lock in last year's rates for a while longer.
Increase your excess. Choosing a higher excess will lower your premium. Just remember, if you're looking to avoid the Medicare Levy Surcharge or Lifetime Health Cover loading, make sure the excess is no higher than $750 for a single person.
Look for a restricted fund. Restricted health funds offer cover to people working in specific industries as well as their families. These funds aren't run for profit, so they can be cheaper, but you have to find one that you're eligible for.
Check if your employer partners with a health fund. Health funds are allowed to give discounts of up to 12% to companies, which those companies can then pass on to employees.
"Last year my first son was born, so getting affordable health insurance with flexible extras became more than just a tax-related priority. Having lived in Australia for only 2 years, I didn't know much about health providers. Finder's selection of best insurance gave me the confidence to check HBF. HBF's Bronze Hospital Plus with Flex 50 extras had everything I was looking for!"
Franco Fagioli
New parent, NSW
Frequently asked questions
Basic plans are typically the cheapest hospital insurance policies you can get in Australia. They start from around $18 per week. Extras insurance is different. That only covers out of hospital treatments.
The cheapest hospital insurance policy in Australia is around $80 per month in most states. However, the price changes depending on the level of cover you get (basic, bronze, silver and gold) and if you add on extras cover.
The cheapest health insurance policies are available in Western Australia and the Northern Territory. A policy in those states costs as little as $60 and $30 per month, respectively. It's around $80 per month for the same policies in all other Australian states and territories.
Not everyone needs health insurance. As long as you're entitled to Medicare, you'll be covered for free treatment in a public hospital if you're injured, fall ill or develop a medical condition in Australia.
For many people, relying on Medicare is the cheapest option, but there are benefits to having private health insurance, and it can even save some people money.
For example, if you earn over $101,000 a year, or $202,000 a year as a couple (including super and fringe benefits), you're hit with an extra tax unless you have hospital insurance. You can buy cover for less than the cost of the tax penalty, so it makes financial sense to get cover, even if you don't want it.
Certain extras policies can also save you money if you regularly spend cash on non-hospital healthcare, such as prescription glasses, dental check-ups or even remedial massage. That's because you can easily claim back more than you pay in premiums over the course of the year.
Remember though, private health insurance doesn't mean you'll get treatment for free. Whether it's a hospital or extras policy, you'll usually have some out-of-pocket costs. The exceptions are no-gap dental and no-gap optical, which are only offered by some health funds.
It's possible that the best way to get a cheaper health insurance policy is to switch to another provider. Switching health insurance is surprisingly easy, with all the hard work done for you, in the background.
No, 2 individual policies are the same price as a couples policy with the same level of coverage. In fact, buying couples health insurance may actually end up being more expensive than if you'd bought separate health insurance policies.
That's because, in a couples policy, both members have to be on the same plan. So if one person wants top tier coverage, the other person has to get it too. If you and your partner want different levels of coverage, it's worth looking into individual policies instead. This is especially useful for health insurance for young adults, where only one of you may need health insurance for pregnancy, which is more expensive.
You can avoid the Medicare Levy Surcharge (MLS) by holding any level of hospital cover that has an excess of $750 or less for singles, or $1,500 or less for couples and families. An extras policy does not count, it must be a hospital policy. The cheapest hospital options are typically basic cover policies. However, it can be worth looking at some bronze policies as they tend to cover a lot more and cost only a few dollars extra.
The cheapest type of health insurance in Australia is Basic Hospital Cover, which offers limited coverage for essential treatments. If you're looking for cover solely to avoid paying extra tax, this is the type of insurance policy to look for.
If you earn above $101,000 (individual) or $202,000 (family) annually, getting private health insurance can help you avoid the Medicare Levy Surcharge. This is currently (as of 2024) between 1% and 1.5%, meaning if you earn $100,000, you'll pay an extra $1,000 in tax. At this point, it may be more affordable to take out a cheap health insurance policy to avoid paying this extra tax.
Basic hospital-only cover is the cheapest type of private health cover you can purchase in Australia. Bronze-tier hospital cover with no extras attached is also on the cheaper side, but still worth checking what's excluded before you sign up.
It's tight, but possible. If you're young, healthy and single, some basic hospital policies in cheaper states do fall around that mark after the rebate is applied. Just know that at that price point, you're getting bare-minimum cover, so double check you're actually getting something out of it.
It depends on why you're getting it. If you're young and healthy and mainly want to avoid the LHC or the MLS, a cheap basic policy can do the job. If you're likely to actually use it, the gaps in cover can cost you more than you saved on premiums.
Yes, as long as the policy meets the minimum requirements (basic hospital cover with an excess of $750 or less for singles, $1,500 or less for couples/families). Remember, not every cheap policy qualifies, so double-check the product details before assuming you're covered.
Sources
To make sure you get accurate and helpful information, this guide has been edited by
Angus Kidman
as part of our
fact-checking process.
Ceyda Erem is Finder’s senior writer for insurance and has almost 10 years of experience writing about personal finance. Formerly a copywriter for several business and finance clients, Ceyda has written hundreds of articles, guides, blogs and more to ensure Australians stay in the loop about how to best manage their money. She has a Bachelor of Arts, Majoring in Writing from Macquarie University.
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Take note of any waiting periods that apply with a policy, as you’ll need to serve these before you can make a claim on insurance.
Unfortunately, I can’t tell you which is the ‘best’ policy as the right health insurance for you will depend on your own needs and circumstances.
When you’re ready, you can click the ‘Go to Site button’ of your preferred insurer to learn more about them and to apply for a policy.
I hope this helps.
Regards,
James
SueFebruary 9, 2017
Can I claim gym membership with extras only cover?
Finder
RichardFebruary 10, 2017Finder
Hi Sue,
Thanks for getting in touch.
Some funds will provide you with discounted gym memberships but it will depend on your policy. For more information, please head over to our article discussing health insurance and gym memberships. You should be able to find what you may be able to claim from each fund.
If in case you are still going to compare policies, please make sure you read the terms and conditions of the policy to learn more and know if it is the right policy for you or not.
I hope this helps. Should you have further questions, please don’t hesitate to reach out again.
AIA health insurance offers a competitive range of health insurance packages, each offering membership to the unique AIA Vitality health and wellness program.
If you're a student, chances are you don't have a whole lot of cash to burn. Compare student health insurance and protect your health and budget.
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Basic Hospital Plus Elevate $750/$1500 Excess
starter bronze + black 50 saver
HCF HOSPITAL BRONZE PLUS $750 EXCESS
Starter Extras
Looking for an insurance to cover cancer, colonoscopy as a private patient
Hi Brett, Check out our detailed guide to cancer and health insurance for more on this topic.
In simple terms, what is for a pensioner couple the best senior health insurance for hospital and extra’s, incl cataracts , hip replacements ? Thanks
Hi Matilda,
Most Silver and Gold policies offer insurance for both hospital and extras, and many include cover for cataracts and joint replacements.
You can use our guide to Seniors Health Insurance to review your options in more detail.
Take note of any waiting periods that apply with a policy, as you’ll need to serve these before you can make a claim on insurance.
Unfortunately, I can’t tell you which is the ‘best’ policy as the right health insurance for you will depend on your own needs and circumstances.
When you’re ready, you can click the ‘Go to Site button’ of your preferred insurer to learn more about them and to apply for a policy.
I hope this helps.
Regards,
James
Can I claim gym membership with extras only cover?
Hi Sue,
Thanks for getting in touch.
Some funds will provide you with discounted gym memberships but it will depend on your policy. For more information, please head over to our article discussing health insurance and gym memberships. You should be able to find what you may be able to claim from each fund.
If in case you are still going to compare policies, please make sure you read the terms and conditions of the policy to learn more and know if it is the right policy for you or not.
I hope this helps. Should you have further questions, please don’t hesitate to reach out again.
Have a wonderful day!
Cheers,
Richard