Singles health insurance: How much does it cost and should you get it?

As a single person, you will likely have different health insurance needs to a couple or single parent, so it can be worthwhile considering a singles policy tailored specifically to your stage of life, general health, income and preferences.

Here we cover some options available to you, outline their average costs based on our data, and offer some tips to be aware of as a single person seeking health insurance cover.

What is singles health insurance?

Singles health insurance is a type of health insurance policy for an individual. It differs from family and couples health insurance, which are taken out to cover multiple people.

While a couples or family policy provides the benefit of having the one policy for multiple members, a singles policy can be chosen based on one individual’s specific needs. Couples may also decide to take out two separate policies so that each policy can be tailored to each person’s needs and desired level of coverage. In terms of cost, there is typically not a large difference between having a couples’ policy or having two singles’ policies.

What does singles health insurance cost?

To give you an idea of costs, Canstar Research has calculated the average annual premiums for hospital and extras cover for singles at various different life stages, based on policies in our database at the time of writing:

Average annual health insurance premiums for singles
Hospital Extras Hospital & Extras
Young (<36 yrs) $1,596 $685 $2,169
Established (36 – 59 yrs)* $1,826 $685 $2,474
Mature (60+ yrs)* $1,998 $685 $2,703
Source: www.canstar.com.au. The Australian Government Private Health Insurance Rebate Base Tier for under 65s of 25.059% has been applied to premiums. National average premiums based on state averages weighted by state population of insured persons.  *Established profile based only on products that include hospital cover for Heart & Vascular, and Mature profile based only on products that include hospital cover for Heart & Vascular and Joint Replacements (not applicable for Extras products). Ambulance Only and Visitors Extras policies excluded.

For singles, the cost of hospital cover generally increases as you age, while the cost of extras cover generally stays the same, based on this analysis. In addition to your age, another factor that can influence the cost of private health insurance is where you live. Canstar Research has also calculated the average annual cost of hospital and extras cover for singles across Australia.

Average annual health insurance premiums – hospital & extras cover for singles
NSW VIC QLD SA WA TAS NT
Young (<36 yrs) $2,176 $2,227 $2,222 $2,140 $2,003 $2,144 $1,816
Established (36 – 59 yrs)* $2,472 $2,542 $2,535 $2,440 $2,311 $2,435 $2,115
Mature (60+ yrs)* $2,700 $2,779 $2,759 $2,657 $2,545 $2,650 $2,343
Source: www.canstar.com.au. The Australian Government Private Health Insurance Rebate Base Tier for under 65s of 25.059% has been applied to premiums.*Established profile based only on products that include hospital cover for Heart & Vascular. Mature profile based only on products that include hospital cover for Heart & Vascular and Joint Replacements. Ambulance Only and Visitors Extras policies excluded.

Please note that these are average figures. The cost of private health insurance to you as an individual will depend on the fund you choose, the policy you select and the state you live in. Health insurance premiums also rise on average every year on 1 April. However, due to COVID-19, many health insurers have postponed this year’s premium increase by at least six months to 1 October 2020.

As well as cost, it’s important to make sure a policy has the right level of coverage for you. Last year, the Federal Government introduced a new tiered system for private hospital insurance policies, with the reforms coming into full effect on 1 April 2020. This sets out the minimum benchmarks of hospital cover that a policy must have. Here’s what treatments and services each tier must cover.

It’s also worth checking whether any restrictions apply to coverage and reading the Product Disclosure Statement carefully before committing to a policy.

Should you get health insurance as a young single?

This is for you to decide, but it could be worth considering some of the benefits of going private over public.

For example, with a private health insurance policy, you may be able to:

  • Skip hospital waiting lists
  • Get a private room
  • Select a doctor or surgeon of your choice
  • Claim rebates on some non-Medicare covered extras services (such as dental, optical, chiropractic and physiotherapy)

There may be other financial incentives to getting private health insurance too. These benefits mainly include:

  • Not paying lifetime health cover loading: if you take out a health insurance policy after you turn 31 years old, you are charged a premium loading. You are charged an extra 2% on your premiums per year every year for at least ten years if you don’t take out an adequate level of private hospital cover before the 1st of July after you turn 31. This can add up to a total surcharge of 70% by the time you reach 65 years old.
  • Not paying the Medicare Levy Surcharge: a tiered charge is applied to Australian taxpayers who earn above a certain income and don’t have private hospital cover. According to the Australian Taxation Office (ATO), this can be up to 1.5% for people on the highest income bracket.
  • Policy discounts: health insurers can offer young Australians aged between 18 and 29 a private health insurance discount. Insurers can offer a discount of 2% for every year before the person turns 30, up to a maximum discount of 10% if they first took out their policy aged 25 or younger.
  • Government rebates: you might be given a rebate for having private health insurance if you earn less than a certain threshold amount.

It’s also important to weigh up the potential drawbacks of getting private health insurance:

  • Cost: private health insurance can be expensive and premiums typically increase each year. According to the Department of Health, there will be an average premium increase of 2.92% in 2020 (however, many insurers have postponed this increase to later in the year).
  • Out-of-pocket costs: private health insurance may only cover part of the cost of a treatment or procedures. This means you may still be out-of-pocket (however, this may be less than if you had no insurance in place).
  • Excluded treatments: policies may not cover every type of hospital treatment or procedure and some may be offered on a restricted basis.

How to look for value when seeking singles health insurance

As well as thinking about your life stage, you might also want to consider questions such as:

  • What level of health insurance do you want?
  • Do you want extras cover?
  • Do you have any pre-existing conditions insurers need to be aware of?
  • What’s your budget for premiums?

It’s important to look at more than price when choosing a health insurance policy. Cheaper policies might be tempting, but their level of cover can be less extensive and exclusions and restrictions can apply.

Co-written by William Jolly.

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Cover image source: astarot (Shutterstock)

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