Leaving your parents’ health insurance and getting your own policy? What you need to know 

Maybe you’ve just finished studying or you’re moving out of home. Maybe you’ve entered your 30s or got married. Whatever your reasons for getting your own health insurance instead of relying on your parents’ health cover, it’s a good feeling to be taking control of your finances and becoming independent. It can, however, be a little daunting – so we’re here to make it easier for you.  

When you choose your own health insurance policy, you’ll have different priorities to your parents. Here are the factors to consider to find the right policy for your age and life stage.  

Your cover requirements 

It’s important to know exactly what you want your health insurance policy to cover. Think about your health needs now, and whether you’re likely to need any procedures or treatments in the near future. Then, use that information to decide on the type of policy you need. Your options are: 

• Hospital Cover – this type of health insurance that helps pay for treatments in a private hospital, which means you can skip long waiting lists for procedures, choose your doctor and (if available) have your own room. There are four tiers of Hospital Cover: Basic, Bronze, Silver and Gold, and here’s what tier covers each treatment and procedure.

• Extras Cover – this type of health insurance pays for treatments outside of hospital that aren’t covered by Medicare, for example physiotherapy and dental treatment. 

• Ambulance Cover  – a policy that only covers treatment by an ambulance. It is not available in Queensland or Tasmania, where ambulance treatment is funded by state governments. Keep in mind, ambulance treatment is generally included in Hospital or Extras policies, so you may not need a separate policy for this unless you want Ambulance Cover only. 

You might choose to take out both Hospital and Extras Cover.  

Remember to check the waiting periods, policy limits and co-payments that apply on any health insurance policy before you buy. 

Your lifestyle 

It makes sense to think about your lifestyle when you’re choosing health insurance. For example, if you’re planning to have children in the near future, choosing a Gold tier policy to cover Pregnancy and Birth care might be a priority. If you have an active lifestyle, Extras Cover that covers physiotherapy might make sense for you. If you’re in a relationship and are taking out Couples cover, or getting a policy as a Single Parent or Family, think about the health needs of everyone needing cover. 

Your income level 

If you earn more than $93,000 as a single person or have a combined income of more than $186,000 as a couple, single parent or family, you will have to pay the Medicare Levy Surcharge (MLS) at tax time. But if you have Hospital Cover with an excess of $750 or less, you’ll avoid paying the MLS, so it might make sense to choose Hospital Cover for financial reasons alone.   

How much is the Medicare Levy Surcharge?

Your eligibility for government rebates and surcharges 

This won’t affect the type of policy you choose, but it will impact how much you pay for your health insurance, so it’s important to be across your eligibility for government incentives and penalties. These include: 

• Private Health Insurance Rebate 

If you earn $144,000 or less as a single person, or $288,000 or less as a couple, single parent or family, the government offers a rebate on your health insurance of between 8.202% and 24.608% (depending on your income level, age and number of children). Also known as the Government Rebate, it can be claimed at tax time or used to reduce your monthly health insurance premium. 

Do I qualify for the Private Health Insurance Rebate?

• Age-based Discount 

If you’re under 30, you may be eligible for a discount of up to 10% on health insurance until you turn 41, if your insurer offers it (not all do).  

Am I eligible for the Age-based Discount?

• Lifetime Health Cover Loading 

To encourage people to get health insurance earlier in life, the Australian government adds an extra charge to Hospital Cover for people who did not take out cover before the age of 31. You will pay an extra 2% Loading for every year you are older than 30 when you take out Hospital Cover for the first time, which must stay in place for 10 years. If you have been covered by your parents’ policy before the age of 30, you will still need to pay the Lifetime Health Cover Loading when you start paying for your own Hospital Cover. 

Find out about Lifetime Health Cover Loading if you’re an Australian who has been living overseas.

How to find the best health insurance policy  

By now you’re possibly feeling overwhelmed and wishing your parents would continue to take care of your health insurance for you. Thankfully, healthslips.com.au has made it easy to find the best health insurance policy for you, at a price that fits your budget. With healthslips.com.au you can calculate your cheapest health insurance for free, without having to enter any contact details. We’re proud to say we’re the only health insurance comparison website that compares every single policy from every insurer on the market, without any bias, to help you get the best policy and premium. So what are you waiting for? 

Start calculating your cheapest policy.

Trudie McConnochie

Writer and Researcher

Knowledge is power – that’s the guiding principle behind everything Trudie writes, and it’s a philosophy she brings to her work at healthslips.com.au. By breaking down complex information into easy-to-understand blogs and stories, she aims to empower Australians to make the best choices and an informed decision around private health insurance.

Trudie understands firsthand some of the complexity of private health insurance having moved to Australia from New Zealand and having to navigate a vastly different public healthcare system and health insurance structure.

Trudie holds a Bachelor of Communication Studies (journalism major) from the Auckland University of Technology.

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