The answers to YOUR FAQs on Health Insurance

9saver spoke to Cahlini De Castro from Health Insurance Comparison to find out the most common questions they field and to get his answers!

9Saver has called in the experts at healthinsurancecomparison.com.au* — the brokers who help you decide on the best policy for your circumstances, and can offer you advice on switching funds or changing policies.

Here, professional broker Cahlini De Castro reveals the Frequently Asked Questions from you, the customers, and his top tips for each one.

FAQ 1: If I switch funds will I have to resit my waiting periods?

DE CASTRO: This a huge one for us, especially with our older customers, and it’s a total misconception. Most people take the set-and-forget approach to health insurance and they don’t really want to review it. It can actually be really stressful when it’s something you rely on, and when it’s something that makes you feel safe.

When you switch your private health insurance provider you don’t have to resit your waiting periods. As long as you have had continuous cover – the waiting periods you’ve already served will be carried over to your new policy. Provided of course that the same treatment is covered by your new policy.

FAQ 2: What will happen to my contract if I switch?

DE CASTRO:  Despite the health insurance sounding very formal and structured, there are no lock-in contracts with private health cover. That’s because the government has intentionally structured the system to encourage people to look for a better deal.

Knowing that you are free to shop around gives you so much power to choose a better policy that works for you. It’s really frustrating seeing people stuck paying more than they need to, simply because they don’t understand how few barriers there are to changing your cover.

To put it simply, there are no rewards for staying loyal to your fund. Longer serving customers aren’t rewarded, and it would actually be illegal for a fund to give them a discount on their policy. That is why the way to get a better deal is to switch, because funds will come out with more competitive offers to attract new customers.

FAQ 3: What will I lose by switching to a new fund?

DE CASTRO: Because so many people imagine private health insurance to be the same as any other kind of insurance they believe that moving to a new fund means they will have to give something up. Once more this just isn’t true.

When you switch you’re entitled to a refund of any premiums you’ve paid in advance to your current health fund. Part of my job is to organise this for you.

I also find a lot of people saying to me, “I don’t want to move funds because I’ve got things I still need to claim on.” But as long as you’re claiming within two years, you can do so without needing to still be with that same fund.

The one downside to the way you carry your health cover history with you, is that when you switch the limits that you’ve already used will come across to your new policy. You can’t win them all sadly.

FAQ 4: But when I got my current policy it was a great deal!

DE CASTRO: We hear a lot of people saying, “When I signed up this was a really good deal, but I just don’t feel like I’m getting value anymore.”

And it’s true that a lot of people remain on dated policies. These might have given them great value at the time, but because rebates don’t get adjusted along with the CPI (Consumer Price Index) they can’t compete anymore.

That’s why we’ll always ask people if it’s been a while since they compared. Even if it’s only been a few years there’s a very good chance there’s a better policy that has become available in the meantime. That can mean far better rebates for the services you find yourself using.

Then there’s the April 1st premium rise. I’ve found a lot of my customers this month have been under the impression that all funds will increase their premiums by the same amount.

Between funds, and especially between individual policies, there are huge differences in how much your premium will increase each year. That’s why we recommend you review your policy at least every couple of years to make sure it’s still competitive.

FAQ 5: What do I need to be covered for?

DE CASTRO: Over time we’ve found that one of the biggest myths in private health insurance is that because you are a certain age, that means you need to have elective services covered. And that’s not necessarily true.

We talk to our customers about their current condition and risk factors and can provide a recommendation about they actually need to be covered for. Most people have in their mind the idea that. as they get older, they need very the top hospital and extras cover.

But if your fund includes pregnancy cover on these higher-tier policies you could still be paying for it when you’re 60, 70, and so on. There are a number of funds out there that allow you to have the top level of cover without paying unnecessarily for pregnancy cover.

* In highlighting particular offers we are not making specific recommendations as this article does not cover all available products and may not compare all features relevant to you. Any advice provided is general in nature and does not take account of your needs, objectives or financial situation. Individuals should consider their own circumstances, and if in doubt seek appropriate advice, before proceeding.