Tuesday 28 February 2012
Double trouble with private health cover
-Aussies warned not to keep heads in the
sand following $780 million premium rise-
With just four weeks before private health insurance prices
rise by an average of 5.06% - from 1 April – the 10% of
Australians with health cover but suffering ‘insurance inertia’,
are being warned to check their health policy. The premium rise
approved by the Federal Government today, will add $780 million to
the cost of Private Health Insurance for Australian families, -
taking action early will be important with means testing likely in
July.
According to recent research by iSelect, a staggering one in ten
Australians with private health insurance (11%1), or an
estimated 290,0002 policy holders, have never reviewed
their policy – while only half (47%1) have reviewed it
in the last 12 months.
“With an imminent price rise, but also means-testing on the
horizon, insurance inertia is not going to help household budgets
over the short or long term,” states Matthew Cuming, Corporate
Affairs Manager for iSelect.
“Without regular policy reviews, people could in fact be
paying for inclusions in their health insurance they no longer
need – for instance retirees with pregnancy cover or people in
their twenties and thirties with a level of cover not suited to
their current circumstances.”
From 1 April, it’s estimated Australian families will pay an
average of $136 more per year for their private health cover. This
is even before means testing for the private health insurance
rebate comes into effect 3 months later (1 July 2012).
“It’s important to remember that the 5.06% rise announced
today is the average increase consumers can expect – so in
reality, many will end up paying much more, in some cases hundreds
of dollars,” adds Matthew.
The research commissioned by iSelect showed the majority of
Australians (89%1) with private health insurance placed
great importance on having it – but in a similar way to mortgages
- significant confusion still exists in people’s understanding of
their ability to switch funds. Close to one third (30%1)
were afraid of being hit with penalties for changing funds and a
similar number (32%1) said reviewing their health
insurance was too complex and confusing.
“Tailoring health cover to match your current stage of life
can result in significant cost-savings. So it’s vitally important
to understand what you actually need from your private health
insurance, and actively shop around for a policy that best suits
your needs and budget. By doing this, it can be possible to
actually offset prices rises or tax penalties like those recently
announced.
“There is for instance, hundreds of dollars difference
between similar policies. In fact, in some parts of Australia the
difference in the cost of top hospital cover for a family can be
more than $900 over 12 months,” concluded Matthew.
Australians keen to get a better deal on their insurance
should visit www.iselect.com.au
or phone 13 19 20.
For further information please contact:
Matthew Cuming (Corporate Affairs Manager - iSelect)
0421
566 787 / mcuming@iselect.com.au
1 Research methodology: Survey conducted nationally by
Woolcott Research (10-12 February 2012) among 1000 Australian
adults (aged 18 or over).
2 Private Health Insurance Administration Council,
Quarterly Statistics, September 2011
ABOUT
iSELECT
iSelect is the leading provider of better solutions for
Australian consumers in the market for household products and
services. We bring competing products with complex features
together in one location in a way that makes it easier for
consumers to decide right.
iSelect is at the forefront of a fundamental change in the
way consumers buy products and services. Consumers use the iSelect
service to save time and get a product that better suits their
needs.
As an organisation, our shared commitment to simplifying the
purchase of complex household products has been the cornerstone of
our success since our launch in 2000. We focus on people, our
partner providers, clients and staff, as we continue to grow and
evolve into Australia’s home of comparison and choice.
iSelect’s partner providers include some of Australia’s
largest companies, across insurance, telecommunications and
banking.
FOLLOW iSELECT ON TWITTER
: @iselect or http://twitter.com/iselect
1 Research methodology: Survey conducted nationally by
Woolcott Research (10-12 February 2012) among 1000 Australian
adults (aged 18 or over).
2 Private Health Insurance Administration Council,
Quarterly Statistics, September 2011.
