In sickness and in health: 10.4m wedded to their health fund

21 March, 2018, Sydney, Australia –Australian health fund members are feeling the pain when it comes to the increasing cost of cover but new research reveals they aren’t voting with their feet.

Three quarters (77%) – the equivalent of 10.4 million policyholders – haven’t switched health funds in over five years, according to a survey of over 1,200 health insurance members by finder.com.au, the site that compares virtually everything.

Previous finder research shows members stick with the same health insurer 11.8 years on average - longer than many Australian marriages¹.

Bessie Hassan, Health Insurance Expert at finder.com.au, warns that our health fund loyalty is likely to be misplaced.

“Members will have received a letter or email from their health fund with how much their premium will be increasing by in April. Unfortunately, there are no exceptions for loyal customers. Now is the time to review your cover before that increase kicks in,” she says.

“The benefit of switching before 1 April is not only will you save by moving to a cheaper health fund but you can also lock in 2017 prices if you pay your annual premium upfront, which could save you $150 - $200 on average.”

“Some health funds offer additional 2-4% discounts for paying up front or by direct debit so you could save up to $500 all up with this trick,” says Ms Hassan.

In the last five years health insurance premiums have risen over 25% or $850 based on the average annual premium.

“The health funds with the lowest annual increases are usually corporate or restricted industry funds so it’s worth looking outside the big four and seeing if your workplace is affiliated with a health fund that offers better value for money,” says Ms Hassan.

Health funds with the lowest premium increases this year include Doctors Health (2.28%), CBHS Corporate (2.38%), and ACA (2.72%).

finder.com.au health insurance hacks:

• Reduce your premium without compromising cover: “If you’d prefer to stick with the same health fund and level of cover there are other ways to save, including increasing your hospital excess.”
• Don’t pay for cover you don’t need: “Make sure your policy reflects your current lifestyle– don’t pay for pregnancy if you’re not planning on having any more children.”
• Look for discounts: “Many health funds offer incentives in the lead up to 1 April for new customers so it’s worth taking these deals into consideration, however it’s important not to make your decision based on these alone.”
• Mix and match: “If you are considering switching, don’t forget you can take out hospital cover with one health fund and extras cover with a different provider, which can sometimes be cheaper.”

finder.com.au’s health insurance service compares over 30+ health insurers and policies side by side. For more tips visit our guide to switching health funds.

¹According to the Australian Bureau of Statistics, of marriages that ended, the median length of marriage before separation was 8.4 years in 2016.