Traveller Heading Overseas

Suspending your health insurance policy

Suspending your health insurance policy while you’re overseas or unemployed can help you save money without affecting your Lifetime Health Cover loading.

After years of planning and anticipation, you’re about to head off on a six-month round-the-world holiday. Your bags are packed and your itinerary is locked and loaded, but there’s one more thing you need to consider before you go: what’s going to happen to your health insurance policy?

Australian private health funds don’t cover you overseas, so there’s no point in paying for cover for the next six months if you’re not going to use it. The good news is that you have the option of suspending your health fund membership while you travel and then resuming cover when you return home.

How long can you suspend cover for?

The minimum and maximum times for which you can suspend cover differ between funds. However, the following limits commonly apply:

  • You can suspend your membership for a minimum of two months
  • You can suspend your membership for a maximum of two years
  • The number of suspensions allowed per calendar year is usually limited to one or two
  • A separate limit may apply to the maximum suspension allowed for financial hardship, for example three months
  • There may also be a lifetime limit on the number of financial hardship suspensions permitted

Check the fine print with your health fund for full details of any limits that apply.

FundIs it possible to suspend health insurance with this fund?Can I suspend my cover if I become unemployed?Minimum amount of time to be overseasMaximum time to suspend cover
ACA Health Benefits Fund
  • Yes
Not mentioned4 monthsNot mentioned
ahm Health Insurance
  • Yes
  • Yes
30 days2 years
Australian Unity Health Limited
  • Yes
  • Yes
2 months2 years
Bupa Australia Pty Ltd
  • Yes
  • Yes
2 months2 years
CBHS Corporate Health Pty Ltd
  • Yes
  • Yes
6 months3 months (financial hardship)3 years2 years (financial hardship)
CBHS Health Fund Limited
  • Yes
  • Yes
6 months3 months (financial hardship)3 years2 years (financial hardship)
CDH Benefits Fund
  • Yes
Not mentioned2 months2 years
CUA Health Limited
  • Yes
Not mentioned2 months3 years
Defence Health Limited
  • Yes
  • Yes
28 Days (ADF Overseas posting)28 Days (Overseas travel)3 months (Financial hardship)3 years (ADF Overseas posting)2 years (Overseas travel)12 months (Financial hardship)
Doctors' Health Fund
  • Yes
Suspension may be allowed under other circumstances28 DaysNot mentioned
Emergency Services Health
  • Yes
  • Yes
14 Days2 years
GMF Health
  • Yes
Not mentioned3 month3 years
GMHBA Limited
  • Yes
Not mentioned4 weeks3 years
Grand United Corporate Health
  • Yes
Not mentioned1 month3 years
HBF Health Limited
  • Yes
Not mentioned2 monthsNot mentioned
HCF
  • Yes
Not mentioned30 days2 years
Health Care Insurance Limited
  • Yes
  • Yes
28 days2 years
Health Partners
  • Yes
  • Yes
3 weeks2 years
health.com.au
  • Yes
  • Yes
2 month5 years
HIF
  • Yes
  • Yes
2 months2 years
Latrobe Health Services
  • Yes
  • Yes
Not mentionedNot mentioned
Medibank Private Limited
  • Yes
  • Yes
2 months2 years
Mildura Health Fund
  • Yes
  • Yes
2 weeks2 years
National Health Benefits Australia Pty Ltd (onemedifund)
  • Yes
  • Yes
Not mentioned2 years
Navy Health Ltd
  • Yes
  • Yes
1 month2 years
NIB Health Funds Ltd.
  • Yes
  • Yes
2 months2 months (financial hardship)2 years3 months (financial hardship)
Nurses & Midwives Health
  • Yes
  • Yes
2 months36 months
Peoplecare Health Insurance
  • Yes
  • Yes
4 weeks2 years
Phoenix Health Fund Limited
  • Yes
Not mentioned3 monthsNot mentioned
Police Health
  • Yes
  • Yes
14 days2 years
Queensland Country Health Fund Ltd
  • Yes

 

Not mentioned4 weeks24 months
Railway and Transport Health Fund Limited
  • Yes
  • Yes
28 days2 years
Reserve Bank Health Society Ltd
  • Yes
  • Yes
3 months40 months
St.Lukes Health
  • Yes
  • Yes
2 weeks2 years
Teachers Health Fund
  • Yes
  • Yes
2 months36 months
Transport Health Pty Ltd
  • Yes
  • Yes
30 days12 months
TUH
  • Yes
  • Yes
2 months3 years
Westfund Limited
  • Yes
Not mentioned2 months24 months

Why would I want to suspend my health insurance policy?

The most common reason people opt to suspend their health insurance policy is because they are travelling overseas. Australian private health funds are unable to provide any cover for medical expenses you incur overseas – you’ll need overseas travel insurance for that sort of protection – so if you’re going to be out of the country for a couple of months or more, suspending cover makes good financial sense.

The other reason people commonly suspend their policy is because they’re experiencing financial hardship. If you’ve lost your job or are battling debt problems and struggling to meet your premium payments, your health fund may agree to let you suspend your membership for a temporary period.

Why not just cancel my policy?

When your health fund agrees to allow you to suspend your membership for a temporary period, you will not have to re-serve any waiting periods when you resume cover at a later date. You will also be able to maintain the level of cover that suits your needs and keep the current benefit limits that apply to your policy.

But if you opt to cancel your current cover and then take out a new policy some time in the future, you will have to serve the full waiting periods set by the fund before you can claim any benefits. This could have a serious impact on your ability to access the health care you need, especially if you develop any health problems which will then be classed as pre-existing conditions by your new fund.

In addition, temporarily suspending your health insurance policy does not have any effect on your Lifetime Health Cover (LHC) loading. However, if you cancel cover this can have serious implications for the cost of cover when you take out a new policy.

How long can I pause my hospital cover for?

You can go without hospital cover health insurance for periods adding up to a total 1,094 days of absence. However, once you’ve used up your total allotment of 1,094 days without cover, you’ll have to pay an additional 2% premium loading on top of any loading you were already paying.

Who is eligible to suspend cover?

Eligibility rules for temporarily suspending your health insurance policy vary between funds. However, to qualify for this option you will typically need to:

  • Have been an active member of the health fund for at least 12 consecutive months
  • Have all your premium payments up to date

If going overseas, you will also need to apply for a suspension prior to your departure date as you cannot retrospectively apply to suspend cover.

Are there any other conditions?

Individual health funds usually impose a range of other conditions on your eligibility to suspend cover temporarily.

  • You will need to get permission from your fund to suspend cover, so you’ll need to have an acceptable reason to ask for this option. Financial hardship and overseas travel are the two most common reasons for taking a break from cover, but your health fund may also allow a suspension in other specific circumstances.
  • There may also be a limit on how many times you can suspend your membership in a calendar year – either once or twice are the limits most commonly imposed. Check with your health fund to find out if there are any other special conditions you need to meet.
  • If you’re a high-income earner and you suspend your policy, you may have to pay the Medicare Levy Surcharge in your tax return for that financial year.

How do you suspend your cover?

It’s usually quick and easy to temporarily suspend your health fund membership. If you’re suspending due to financial hardship, you will need to get in touch with your health fund by phone, email or post, or potentially fill out an online application form. Once the suspension ends, you’ll need to start making premium payments again within 30 days.

If you’re suspending cover while you travel overseas, make sure your travel dates are locked in and then contact your health fund by phone, email or post, or by filling out an online application form if available. You will usually be sent a confirmation letter or email when your application for suspension has been approved.

Finally, remember that your membership suspension must be approved before you depart on your overseas trip, as you can’t apply for a backdated suspension.

Am I covered while my policy is suspended?

You will not receive any cover for health care expenses you incur while your policy is suspended. This means that you will not be able to make any hospital or extras claims, but also that you will not be required to pay any premiums during this time.

However, despite the fact that no cover is provided, you are still considered to be a member of the fund during this time. As a result, you will be able to easily resume cover when the suspension period ends.

How do I restart my policy?

You’ll need to restart cover within 30 days of the end of the suspension date, otherwise your policy could be cancelled. Your fund will most likely remind you when cover is due to be resumed or automatically reinstate cover at your requested date.

If you’ve been overseas with an unconfirmed return date, inform the health fund that you are back in Australia within 30 days of your return (you will usually need to provide a passport, flight ticket or boarding pass as proof). If you are no longer experiencing financial hardship and can afford to resume cover, you can let your health fund know at any time.

Once you’ve restarted your policy, your level of cover, benefits and waiting periods will all be the same as they were before the suspension.

What if my fund won’t suspend my cover?

The rules for suspending your membership vary from one health fund to the next. So if your fund refuses to let you suspend your policy, contact other funds to find out whether they would be willing to grant a suspension.

If suspending your membership is not an option, remember that you may be able to let cover lapse for a limited period – remember, you’re allowed a combined total of 1,094 days without any cover without it having any effect on your LHC loading.

Compare policies from 30+ Australian health funds

Picture: Shutterstock

Tim Falk

A freelance writer with a passion for the written word, Tim loves helping Australians find the right home loans and savings accounts. When he's not chained to a computer, Tim can usually be found exploring the great outdoors.

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