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How to pay for health insurance in Australia

How you pay for private health insurance can affect the overall cost of your cover.

One of the important issues to consider when taking out health insurance is how to pay your premiums. There are several payment methods and also payment frequency options available, and the premium payment choices you make can even affect the total cost of cover.

How can you pay for private health insurance?

There is usually a number of ways your fund will accept premium payments. Although not all funds will offer support for each of the payment types mentioned below, you can typically choose from the following options:

  • Direct debit from bank account. When you sign up for a policy, all you have to do is provide your bank account details (account name, account number and BSB) to your health fund. The fund will then automatically withdraw the necessary payment from your account whenever the premium is due.
  • Direct debit from credit card. This works the same as above except that instead of providing your bank account details, you provide your credit card details (name on card, card number, expiry date and CVV). Your health fund will then automatically debit your card whenever payment is due.
  • BPAY online or over the phone. When you need to pay a premium, you can do so via BPAY through your bank’s Internet or phone banking service. You’ll need to provide your health fund’s biller code and quote a reference number.
  • Online from your credit card. Most funds will allow you to pay your premium by logging into your health insurance account online and entering your credit card details into the payment section.
  • In person at a retail centre. You can visit your health fund’s nearest retail centre to pay via credit card, cheque or any other method of payment your fund allows.
  • In person at a post office. You can visit your local post office to pay your health insurance premium in the same way you might pay a utility bill.
  • By mailing a cheque or credit card details. Some funds will provide a postal address to which you can send a cheque to cover your premium amount, or to which you can send a credit card payment slip.

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What are the pros and cons of each payment option?

There are benefits and drawbacks to each of the health insurance premium payment methods listed above. Check out the table below to work out which of these payment options is the right one for you:

ProsCons
Direct debit from bank account
  • Simple and convenient payment option
  • You don’t need to manually enter payment details each time a premium is due
  • You pay using your own funds rather than running up a debt on your credit card
  • Many health funds offer discounts of up to 4% if you pay by direct debit
  • You may forget you have a direct debit set up – this can be a problem if you switch health funds
  • You may not have sufficient balance to cover your premium
Direct debit from credit card
  • Simple and convenient payment option
  • You don’t need to manually enter payment details each time a premium is due
  • Many health funds offer discounts of up to 4% if you pay by direct debit
  • You may forget you have a direct debit set up – this can be a problem if you switch health funds
  • Interest applies to credit card debt
BPAY online or over the phone
  • Easy to do via Internet or phone banking
  • Save your health fund’s details in Internet banking for faster transactions in future
  • Faster than paying in person
  • Unlike direct debit, you have to manually arrange payment each time your premium is due
  • Pay with money from your bank account rather than running up a credit card debt
Online credit card payment
  • Simple and relatively quick to do
  • Faster than paying in person
  • It’s not automatic – you’ll need to visit your health fund’s website and potentially log into your account whenever you need to make a payment
  • Interest applies to credit card debt
In person at a retail centre
  • Handy if you don’t feel comfortable paying online
  • Face-to-face service
  • Multiple payment options accepted
  • Manage other aspects of your health fund membership at the same time
  • More time-consuming than many other payment options
  • Can’t be done from the comfort of home
In person at a post office
  • Handy if you don’t feel comfortable paying online
  • Face-to-face service
  • Pay your health insurance premiums when you pay other bills
  • More time-consuming than many other payment options
  • Can’t be done from the comfort of home
By mail
  • Handy if you don’t feel comfortable paying online
  • Multiple payment methods available
  • Takes longer than online payment
  • You may need to pay postage costs
  • If using a credit card, you will have to send your card details by mail, which may not be secure

How often do you pay health insurance premiums?

Depending on the fund, the available options may include fortnightly, monthly, quarterly, six-monthly or yearly. Prices for private health insurance are generally quoted as a weekly or monthly price, so they tend to be the most common payment schedules. Most funds also require you to pay at least one month in advance.

Why would you want to pay your premiums upfront?

The most affordable premium payment frequency is usually to pay your annual premium in advance. This is because many funds offer sizable premium discounts, sometimes as high as 4%, to those customers who pay a full 12 months of membership in advance.

FundDirect debit discountAnnual payment discount
4%
  • Annual: 4%
  • Biannual: 2%
4%
n/a
n/a
  • Annual: 2.5%
2%
n/a
  • Annual: 4%
  • Biannual: 2%
  • Annual: 4%
  • Biannual: 2%
2.5%
n/a
n/a
  • Annual: 4%
  • Biannual: 2%
4%
n/a

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Frequently asked questions about paying for health insurance

Here are some of the other questions we're often asked about paying for health insurance.

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