So you’ve decided you need private health insurance. Now comes the tricky part – how do you know what to look for? It’s a complicated product, and it can drive you crazy trying to make sense of price, exclusions, waiting periods, out of pocket costs, excesses, and the remaining dictionary of jargon. Naturally, what’s important will differ from person to person. But there are some key areas for you to focus on and questions that you can ask to give you the confidence that you are looking at the best policy.
We recommend you start by asking us for a recommendation – we work with real life experts at insurers who know their products inside-out, and are trained to consider your needs when providing recommendations. But now that you have a hand-picked shortlist of the best policies from the leading insurers, how do you decide which one to pick? Or maybe you’re planning on doing all of your research yourself – we’re totally cool with that as well!
Before choosing a policy, we recommend you consider:
How important is price compared to the overall level of protection that the policy provides? If you’re just looking to minimise your tax bill, price may be the main factor. But if you’re looking for comprehensive health cover, the overall level of protection that the policy provides takes on greater importance
Are you covered for the things that matter to you? If you are looking to start a family, does the policy include pregnancy cover? If you have a history of heart-related illnesses, will you be covered for this?
Will you only be covered as a private patient in a public hopsital? Or as a private patient in a private hospital? Your ability to choose your hospital and skip waiting lists will differ significantly between the two. Speak to the insurance company about their recommended policy, and what this means for your level of cover
If you are looking for policies with hospital coverage, you will want to consider any excess or co-payments. An excess is the amount you pay when you go to hospital, and is usually a fixed amount (e.g. $500). For most policies the excess is only paid once per person per year, but this can differ by policy. Co-payments are a fixed amount that you are required to pay per hospital day, usually up to a maximum number of days. While the mechanics may differ, both an excess and co-payment have a similar impact, where you are required to contribute to your hospital costs. These costs usually have a significant impact on premiums – if you’re prepared to pay a higher excess or co-payment, your premiums will be lower. Of course if you do end up going to hospital, the higher excess or co-payment will add to the cost (or reduce the benefit) of having private health insurance, and you need to consider whether you can afford this
If you do need to go to hospital, depending on the total cost of your admission you may be faced with significant out-of-pocket costs. Comprehensive information is very difficult to obtain as it will differ by procedure type, insurer, and will vary depending on how much the total cost is. Nonetheless, it’s worth speaking to the insurance company before purchasing a policy to discuss this concern, and perhaps asking for examples. If you are taking out extras coverage, you will be faced with similar out of pocket costs for extras claims (e.g. you may not be fully reimbursed for your new pair of glasses), but information on category and item limits are readily available, and we suggest speaking to the insurer to understand the potential out of pocket costs for the things that are important to you
The amount you are able to recoup from a hospital visit will depend significantly on whether your insurer has an agreement with the hospital you visit. Before you purchase your policy, check with the insurer whether they have agreements with hospitals in your area
Waiting Periods – you may need to serve a waiting period before claiming on certain categories. If you know you urgently need cover for something specific, this may be particularly important
Does the insurer have a disproportionate number of complaints made against them? Do they have easy to use and reliable online systems to manage your policy and make claims? Do they have physical stores near you?
Consider the above list as guide for questions that you may want to ask an insurer before purchasing a policy. Some of these points may not be relevant to you, others you may already know the answer to, and there may be things that are important to you that haven’t been listed. Use your common sense, and we recommend having a chat with a customer service expert from the insurer before you purchase a policy.