3.3 million Aussies will switch or ditch their health cover in 2023
Millions of Australians are considering switching or ditching their private health insurance policy as expenses soar, according to new research by Finder.
A Finder survey of 1,080 Australians – 577 of whom have private health cover – revealed nearly one third (31%) of people with health insurance plan to switch or ditch their current plan.
That's 3.3 million Aussies looking for a better deal or simply dropping their health insurance altogether.
Finder's research found a quarter of those with cover (26%) say they plan to renew but might switch policies if there's a better deal, while a further 5% plan to cancel their cover.
Tim Bennett, health insurance expert at Finder, said many were facing the dilemma of whether to switch or ditch their policy.
"Aussies have been hit with everything from skyrocketing energy bills, to rising petrol prices and food bills and in many cases insurance is the first non-essential to be cut.
"We may start to see higher rates of underinsurance over the coming months as many simply won't be able to afford the policies they need.
"Those in the most vulnerable positions are at risk of ignoring health concerns for fear of a medical bill they can't afford."
According to Finder's Consumer Sentiment Tracker (CST), health insurance is one of the most stressful expenses for 14% of Aussies who have it.
Bennett encouraged Australians to weigh up the costs and benefits of private health cover.
"Giving up your private health insurance can be a risky gamble, especially if you have a health condition or anticipate needing surgery in the future.
"If you don't have hospital cover before your 31st birthday, you'll face a 2% surcharge on your premiums for each year you aren't insured thereafter – this is called the lifetime health cover loading.
"This means if you wait until age 60 to take out a hospital policy, you'll pay 60% more on your premiums than if you had held a policy since age 30.
"Having sufficient hospital cover also lets you avoid paying the Medicare levy surcharge that costs up to 1.5% of your income if you're earning above $90,000."
Bennett said there are no downsides to comparing and switching your policy.
"You can almost always save money, and you won't have to give up your waiting periods as these can be carried over between funds."
| Will you renew your private health insurance this year? | |
|---|---|
| Yes, with the same insurer | 68% |
| Yes, but I might switch if there is a better deal | 26% |
| No, I plan to cancel | 5% |
| Source: Finder survey of 577 Australians with private health cover, April 2023 |
Check out the winners of the Finder Health Insurance Awards 2023 here.