- Less than 1 percent (0.70%) of visitors to Canstar’s health insurance selector tables in June 2016 were looking for a health insurance policy specifically for tax reasons
- Compares to almost 8.5 percent in June 2015
- Analysis based on customer behaviour of more than 70,000 individuals
While the federal election outcome is unknown, it would appear that at least one message by both major parties has been heard by the publilc, with financial research and comparison site canstar.com.au reporting a significant drop in the number of Australians shopping for cheap health insurance policies specifically to avoid additional tax.
“It’s interesting this year to note that far fewer people are searching for a health insurance policy simply to avoid tax,” said Canstar Editor in Chief, Justine Davies.
“Generally we see a build up as we get closer to the end of financial year in the proportion of visitors to canstar.com.au looking for a health policy in order to avoid tax. It tends to peak in June; in 2015 8.45% of visitors were looking for a health policy simply to avoid tax. This year though we didn’t see that build up at all – only 0.70% of visitors were looking for a health fund to avoid tax this June.
“It’s certainly not due to fewer people looking for a health fund; there were significantly more people overall shopping for a health policy on our site this June, but they were almost all looking for a more fully-featured policy.”
While it isn’t possible to be certain of the reason for this significant drop off, Ms Davies points to the government’s ongoing publicity campaign around basic health insurance policies over the months leading up to the end of financial year.
“Back in March the Minister for Health, Sussan Ley, issued a release calling some health insurance policies “junk” and hinting that these policies may not continue to receive government rebates. In the week prior to the election, the opposition specifically announced its intention to remove the health insurance rebate from policies that only cover public hospital treatment. It would appear, all other things being equal, that these messages have hit home with consumers,” she said.
Cost of health insurance
Below is the range of monthly premiums for hospital cover in Australia, based on insurance policies targeting various consumer profiles on CANSTAR’s database.
|Profile||Monthly cost range|
|“Tax”||$50 – $91|
|Singles||$54 – $144|
|Couple||$114 – $288|
|Family – Without Obstetrics||$129 – $255|
|Family – With Obstetrics||$148 -$288|
|Source: Canstar.com.au. Based on 5 star rated products on Canstar database. Range will vary in each state, excludes NT. Hospital cover only.|
“Approaching health insurance with a “how much do I want to spend” attitude is the wrong strategy. Approach the question from a “what do I want to be covered for” attitude and work backwards from there,” said Ms Davies.
“Think about the lifestyle implications of your health insurance choices. If you need a knee replacement, do you really want to wait six or seven months, probably in chronic pain, for that to happen at a public hospital? Because that’s the average wait time you’re looking at. How would that impact on your work or your home life? Even a tonsillectomy is an average of around 4 months waiting time.
“Also think about your family history. Are there certain illnesses that you might be prone to? Fortunately in Australia health funds aren’t allowed to price according to individual risk (unlike some other countries – New Zealand for example). So you can happily insure yourself irrespective of your personal risk factors.”
For further information:
Editor in Chief
Ph. (07) 3837 4151 / 0400 127 733
Canstar provides Australia’s interactive online research service in consumer and business finance. Founded in 1992, Canstar Pty Limited is Australia’s researcher of retail finance information for over 250 institutions such as Banks, Building Societies, Credit Unions, Finance Companies, Brokers, Mortgage Originators, Life Companies and finance related Internet Portals. Canstar customers use the extensive database for competitor analysis as well as a means of disseminating their product range. Canstar also distributes this information to print and electronic media for publication and to Agents, Accountants, Brokers and Internet Portals for use in advising their clients.
What are the Canstar star ratings?
Canstar researches, compares and rates the suite of banking and insurance products listed below. Results are freely available to consumers who use the star ratings as a guide to product excellence. The use of similar star ratings logos also builds consumer recognition of quality products across all categories. Please access the Canstar website at www.canstar.com.au if you would like to view the latest star ratings reports of interest.
|Account based pensions||Managed investments|
|Business banking||Online banking|
|Business life insurance||Online share trading|
|Car insurance||Package banking|
|Credit cards||Personal loans|
|Deposit accounts||Reward programs|
|Direct life insurance||Superannuation|
|First home buyer||Term deposits|
|Health insurance||Travel insurance|
|Home & Contents||Travel money card|
|Home loans||Youth banking|
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