Moved to Forum: Original Link
Health insurance premiums are rising on average 5.69% on 1st April 2016 (its no joke!). Pre-pay your next 12 months insurance by 31st March 2016 and you will pay the pre-price rise premium for the next 12 months.
You can see how much your insurer is raising their rates by on the site http://health.gov.au/internet/main/publishing.nsf/content/pr…
To take advantage of this you need to get in contact with your health insurer and make a payment before 31st March 2016.
A heads up, some require payment before the 31st March. CUA's deadline is tomorrow, 24/3.
Where, who and how?
Where is the deal? Sounds like those TV ads we've heard for ages now.
Its a deal because you pay less for your health insurance for the next year… e.g. mine was going from $200/month to $220/month. If I prepay, I pay $200/month for the next 12 months. If I don't pre-pay, from 1st April I pay $220/month.
So I save about $240/year.
Any thoughts on whether pre-paying 12 months is a good idea or not? Compared to keeping the money in savings and paying the increased premium per month? (I know I should probably just whip out my calculator but keen to hear others' general thoughts too).
Using the above example from matt_will_fix_it, which is a 10% increase ($200 to $220 a month) I think prepaying is much more worth it. If you can find a savings account that will give you 10% let me know!
Very true, thanks!
Depends on your circumstances. My family cover is increasing by $577.25 annually hence paying it upfront is a no brainer.
Ouch! My singles cover is increasing by $202.80… so yep, definitely makes sense to pay it in advance too.
I agree this is sort of a deal.. definitely worth knowing and it's a worthwhile saving for sure.
But yea probably more suited to forums (it's been moved now anyway).
Thanks for the heads up!
I always paid in advance and save a lot
The other part to this is the rebate percentages are indexed annually. For example, for me the Australian Government Rebate changes from 27.820% to 26.791% as at 1 April 2016.
So an extra 1% saved by pre-paying.
You all realise that the saving is a 'once off?'
Eg. I signed up on 1/4/15 for a $1200/year policy. Paid it in full, covered to 31/3/16.
My premium is set to increase by 6% on 1/4/16, bringing it to $1,272 if I pay for it after 1/4/16… so I be sneaky and pay it on 31/3/16 and only pay $1200 for the years cover.
So I've 'saved' $72 in the first year, but on 31/3/17, what amount am I going to pay? Thats right - $1,272.. the same amount as I was going to have to pay for the year just passed if I paid it after 1/4/16.
Advantages can be had if you're income is changing significantly in one year to another - the rebates on PHI are not flat 30%, and is dependant on WHEN you pay for the cover, as opposed to the period of cover. Particularly if one income earner is going to be reducing income (eg. Pregnancy/stay at home mum/dad). This is where you might be better off NOT to prepay a years PHI until the end of the financial year, when their income is less.
So I've 'saved' $72 in the first year, but on 31/3/17, what amount am I going to pay? Thats right - $1,272.. the same amount as I was going to have to pay for the year just passed if I paid it after 1/4/16.
Yes, but you've been able to use that money in the meantime.
I was going to prepay my insurance but looking at the increase of $6.82 per month ($81.84 per year), it's not worth it (spending $1k+ in one go is a lot).
This has been the case for many years.
I am finding this year the increase was like $22 per annum so I think I might not prepay this year.
Also good if you need a quick spend on your credit card for bonus points deals etc
Our HBF is normally paid 3 monthly ( last paid in Feb.) Top cover - present cost $925.80 for both of us. Going up by $77.95 each 3 months to $ 1003.75.
To me it would make sense to pre pay to save $ 311.80 - not that it would help for next years renewal time though.
What are your thoughts ?
If you are confident that you will stick with them for the next 12 months and can afford the one off cost I think that it is definitely worthwhile.
A big thankyou for this post, I had completely forgotten. Just paid another 13 months at this years premium. Thanks for the reminder.
Pre-pay + balance transfer to new CC card could be an option
Thanks for the great reminder! Does anyone know how we can find out whether certain funds let you pre-pay and by when? eg I'm with BUPA and Googling hasn't found me anything yet.
I'm with BUPA too. Just phone them.
Thanks to all. After much deliberation we bit the bullet & paid out $ 3125.45 to cover us until end of March next year - bit of an ouch but definitely cost effective in the long term. Wouldn't have done it without reading all your views & suggestions.
Love this site 👏🐸
i think this belongs in the forums.