Health funds such as nib, Bupa, GMHBA, Frank, and Qantas will raise premiums between 2.72% and 3.39%, resulting in some families paying an additional $170 per year for insurance.
Lana Hambilton, head of health insurance at Compare the Market, explains that these increases are a result of premium hikes that were delayed six months ago due to cost-of-living pressures.
"Typically, health funds adjust their premiums on April 1st, but many chose to delay the increases to assist Australians during the cost-of-living crisis and compensate for reduced claim volumes during the COVID-19 pandemic," Hambilton said.
"Other funds such as ahm, Medibank, AIA, and HCF have already passed on the increases to customers after delaying their rates. Now, it's time for other major health insurers to do the same."
Bupa Takes the Biggest Hit
Among the insurers raising premiums in October, Bupa - with approximately 4.1 million customers - is the largest. This is followed by nib (including Qantas) with 651,000 customers and GMHBA (including Frank) with around 370,000 members.
The price increases will vary. For example, one customer with Qantas' gold complete hospital plan can expect their policy to rise by only $2.75 per month ($33 per year). On the other hand, an Australian with a Bupa silver plus prime plan has been notified of a $14.44-per-month price hike ($173.20 annually).
"This demonstrates that health insurance premiums are influenced by several factors, including the health fund, policy type, location, coverage level, and whether it's a couples, family, or single policy," Hambilton explained.
"We also know that the average increase varies between funds, so now is a good time to ensure you're getting the maximum value from your policy."
Dispelling Health Insurance Myths
There are common myths that often discourage Australians from switching their health insurance, even when their circumstances change.
One major myth is that individuals will need to serve waiting periods again when switching providers or plans. However, funds recognize any waiting periods already served with previous providers.
It is important to note that new or upgraded services and benefits in a policy may still have waiting periods. Therefore, carefully reading the product brochure is essential.
Hambilton advises individuals considering a policy change to assess their anticipated health service needs for the upcoming year. Often, Australians pay for unnecessary comprehensive plans that come at a higher cost.
"If your health circumstances have changed, you may be eligible to switch to a lower hospital insurance tier that still includes the essential coverage," she recommended.
While major insurers are increasing premiums, there are numerous attractive offers available at the moment, including additional rewards and perks for switching insurance providers.
Hambilton mentioned that some insurers are even providing several free weeks upon signup.
"You might also have access to exclusive wellbeing and reward programs," she added.
"Just remember that these free periods, perks, and rewards are usually only available for a limited time on qualifying policies. Therefore, consider this when comparing your options."
