Health insurance premiums set to rise, consumers urged to shop around

Private health insurance premiums are set to increase by an average of 6.18 per cent from April, and consumers are being urged to “shop around” for the best deal.

Health Minister Sussan Ley, who approved the price hikes, said the total benefits paid to private health insurance members grew by over $1 billion – or 7.4 per cent – to about $17.3 billion in the 12 months to December 2014.

She urged consumers to use the Government’s independent comparison website to get the best deal, noting that some health funds will offer below-average premium increases as low as 3.98 per cent.

“Over 13 million Australians now have some form of private health insurance and it’s therefore essential for the health of our nation that we continue to maintain a strong and competitive market,” Ms Ley said in a statement.

“To achieve that we must ensure any premiums increases strike the right balance between keeping them affordable for consumers without putting the financial viability of the sector at risk.

“With over 30 private health funds now operating in the Australian market, my strong advice to consumers is shop around to get the best deal if you are unhappy with your health fund’s offering.”

Ms Ley said increasing insurance costs were an ongoing challenge faced by successive governments, and noted that Labor approved average annual premium increases as high as 6 per cent during their six years in office.

Private health insurance benefits paid to members increased by 7.4 per cent from $16.09 billion in the December 2013 quarter to $17.28 billion in December 2014 quarter.

The weighted industry average health insurance premium increase for 2014 was 6.2 per cent.

See the full list of average premium increases for individual health funds here.