Navigating private health insurance in Australia can feel complicated, with so many policies, benefits, and rules to keep track of. But the good news is that there are some simple principles you can follow to avoid mistakes and make sure your cover works for you. Whether you’re new to private health insurance or have held a policy for years, these 10 rules will help you stay on top of your health cover and reduce unwanted surprises.
1. Keep your premiums up to date
Falling behind on payments can cause your policy to lapse, leaving you without cover when you need it. If this happens, you may have to re-serve waiting periods before benefits apply again. To avoid this, set up automatic payments and check your statements regularly. If you’re struggling financially, contact your fund as many offer payment assistance or temporary relief.
2. Understand how waiting periods work
Switching funds or upgrading cover comes with rules about waiting times. If you move to a policy with equivalent benefits, completed waiting periods will usually carry over. But for new or higher-level services, you’ll need to serve fresh waiting periods, which can be anywhere from two months to a year depending on the treatment.
3. Review your cover every year
Your needs will change over time. A policy that suited you five years ago may no longer fit your lifestyle. Life events such as starting a family, children leaving home, or entering retirement are good times to review your cover. Regular checks also ensure you aren’t paying for benefits you no longer need.
4. Watch for policy updates
Health funds generally increase premiums annually and sometimes adjust what their policies include. Insurers are required to notify you, but it’s easy to overlook letters or emails. Always read communications carefully, especially around March when most changes are announced.
5. Know the limits of your extras cover
Extras cover can be useful for services like dental, optical, and physiotherapy, but every policy has caps and conditions. There may be annual or lifetime limits, as well as rules about how often you can claim. These limits can vary between funds and reset on different dates, so understanding your policy helps you plan and avoid large out-of-pocket bills.
6. Ask for cost details before treatment
Before you agree to a procedure, especially in a private hospital, ask your doctor for the Medicare item numbers and confirm with your health fund what will be covered. Check whether your doctor participates in your fund’s gap scheme, and ask other specialists involved—such as anaesthetists—for their fees upfront. This preparation reduces the chance of surprise bills.
7. Choose hospitals within your fund’s network
Many insurers have agreements with private hospitals that help lower your costs. If you’re treated at a non-partner hospital, your fund may only cover part of the bill, leaving you to pay more. Contact your insurer before booking a procedure to confirm whether your chosen hospital is covered.
8. Keep your insurer informed of changes
Moving interstate, going overseas for an extended period, or changes in your family situation can all affect your policy. For example, you may be able to suspend your cover while living abroad, or you may need to update your plan when adding a new dependent. Keeping your insurer informed ensures your cover remains valid and appropriate.
9. Submit claims without delay
Most funds have a deadline for lodging claims—often two years. Submitting promptly makes the process smoother and ensures you receive your entitlements. Many funds have apps or online systems that make claiming fast and simple, while also keeping digital records for your convenience.
10. Know the rules when switching funds
Changing health funds can be worthwhile if you find a policy with better benefits or lower costs. Thanks to portability rules, you won’t lose credit for waiting periods you’ve already served when moving to an equivalent policy. However, new services or upgrades will still require fresh waiting periods, and not all benefits transfer, so always read the fine print before switching.
Final thoughts
Private health insurance can be confusing, but keeping these rules in mind will help you avoid costly mistakes, stay protected, and make the most of your policy. With regular reviews, careful planning, and clear communication with your insurer, you’ll be better equipped to manage your health cover and your budget.
