Time is running out to switch health funds

Richard Laycock 27 March 2017

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Lock in your health insurance premiums before 1 April.

It's the final days of March, which means you only have five days left to take out health insurance and lock in your premiums at their current rate before they go up by an average 4.84%. And while premiums are going up, the private health insurance rebate is going down, which means you should be looking at ways you can minimise how much you're spending on health insurance.

One way you can save on health insurance is by reviewing all of the deals and bonuses on offer from different private health funds in March. These deals can range from gift cards and frequent flyer points to premium discounts and waiting period waivers.

Speaking of frequent flyer points, depending on your credit card, you may be able to pay your premiums up front using plastic and rack up some frequent flyer points.

Another way to avoid paying too much for health insurance, or at least more than you have to, is by looking for a health fund that provides a discount for members who pay their premiums via direct debit. These discounts range from 1.5% to 4%. And since you have to pay your premiums up front to avoid a rate rise, why not look for a fund that offers an upfront payment discount? These discounts vary but are generally between 2% and 4%.

If you are planning to switch health funds before 1 April, make sure you're making an informed choice. While signing up with a provider that offers deals and discounts might be nice at face value, you should also make sure that the fund you're planning to switch to provides a high level of cover for the types of hospital and extras services you need the most.

Other good points of comparison include looking at which funds have had the highest rate rises in recent years, what percentage of member contributions a fund returns in the way of benefits and how satisfied current members of each fund are.

A recent survey found that the average Australian sticks with their health fund for 11.8 years on average. As with all financial products, it's never wise to set and forget, especially when you consider the fact that health insurance premiums have risen by almost 50% since 2010. If you're thinking about making the switch, make sure you compare your options.

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