Large insurers are raising rates by a significant margin
Several of Australia’s largest health insurance providers, including Medibank Private Limited and NIB, will be increasing premiums in the coming days. These insurers have been raising premiums annually for the past few years, which has placed many consumers under greater financial pressure. Some of the country’s insurers have also been accused of offering “junk” policies, which offer consumers very limited coverage. With higher premiums and the abundance of these junk policies, many consumers may opt to go without health insurance coverage entirely.
Many consumers may opt to abandon their coverage
On April 1, premiums for families are expected to rise by $200 a year, with premiums for individuals rising by approximately $100 a year. Last year, those with private health insurance saw their premiums rise by an average of $185. As a result of this year’s premiums hikes, many consumers are expected to shop around for new policies. A recent survey from iSelect, a insurance cost comparison site, some 530,000 Australians plan to abandon their current insurance policies due to high premiums. This may put Australia’s public health care system under considerable pressure in the coming months.
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Survey shows that many consumers have considered dropping their policies
Another survey from iSelect conducted in December of last year shows tat one in six Australians are unhappy with their insurance coverage, which resulted in them finding new policies. Approximately one in four had considered to completely abandon their coverage, going without insurance for the whole of 2015. Those that considered dropping their insurance policies said that they would do so in order to save money, as coverage was becoming too expensive to be considered useful.
Tax penalty may be less expensive than paying premiums
It may soon be less expensive for consumers in Australia to pay the tax penalty for being uninsured rather than pay for their coverage. Moreover, consumers are also very unhappy with some of the country’s largest insurers, with many believing that switching to a non-profit insurers would be in their best interest. If premiums continue to grow, this may become the case, which may become a significant problem for insurance companies in the country.