Yahoo Finance Health insurance hike: Millions urged to act today to avoid $121 price hit
Health insurance premiums are rising from April 1, but there’s a little-known way to “turn back time” and lock in cheaper prices.
Time is running out for Aussies to avoid higher health insurance costs, as insurers prepare to hike their premiums from April 1.
Premiums will increase by an average of 3.03 per cent this year, but some major insurers have confirmed their prices will increase by up to 5.82 per cent.
Singles can expect to pay an extra $81 per year with the average increase, while families will have to fork out an extra $153 per year for cover. On average, Compare Club analysis found people would be hit with a $121 price hike.
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Finance expert David Koch said Aussies could take advantage of a little-known trick to “turn back time” on the rate hikes and lock in lower rates for up to 12 months.
“Some health insurers allow you to pay for your policy at least a year in advance, a move that can secure the price you currently pay before any rise in prices,” the Compare the Market economic director explained.
But you’ll need to act quickly and get your payment processed before the date the rate rise takes effect.
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“We know that this year’s April 1 deadline falls on Easter Monday, so funds that apply the rate rise from April 1 may require you to have your payments processed before the first Easter long weekend public holiday on Good Friday,” Koch said.
“If in doubt, contact the health fund directly to understand any cut-off dates they have.”
To take advantage of the hack, you’ll also need to be able to afford to pre-pay your premium for up to 12 months to enjoy the lower prices for longer.
“While it’s a high upfront cost, it could save you in the long run – especially as you won’t be paying the higher premiums until 12 months down the track when the next round of health premium increases roll around,” Koch said.
Koch urged Aussies to review their health insurance cover and make sure they were getting the most value possible.
Aussies may be able to save by switching to another health fund with similar cover or moving to a lower level of cover that still suits their needs. Other tips include increasing your excess and checking for perks or incentives on offer.
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