Millions of Australians with private health insurance may not be seeing the annual notifications that their premiums are about to increase, as funds prepare to lift prices by an industry average of 4.41% on April 1. Research commissioned by Money.com.au found that 18% of Australians – about 2.7 million people – say they routinely miss their health insurer’s premium increase notice because they do not open the message or assume it is marketing material.
Most health funds send their annual premium advice in the weeks leading up to the April adjustment, which this year is the largest average increase since 2017. Under federal requirements, insurers must advise members in writing of premium changes and give them enough time to review or change cover. The Private Health Insurance Code of Conduct adds a non‑legislated benchmark, with most signatories committing to provide at least 30 days’ notice of price changes. The findings point to ongoing challenges around member communications and the possibility that some policyholders may not review their cover until after the increases take effect.
The nationally representative survey of more than 1,000 adults indicates variation in when and how policyholders receive their annual notice. According to the research, 38% of respondents said they receive premium rise notifications more than a month before the April change. Another 36% reported receiving between two and four weeks’ notice, while 8% said they receive less than two weeks’ warning that their premiums will increase.
Money.com.au general manager of health insurance Chris Whitelaw said many customers are unclear about when to expect their letter or email. “It’s important to keep an eye out for your individual notice, as this will show exactly how much your policy premium will increase in dollar terms. From there, you can see how your increase compares with the industry-wide average rise of 4.41%. These notices are usually sent by email and SMS,” Whitelaw said.
He added that practices differ between funds. “Some funds send their notices early, while others may only give a few weeks’ warning. If you’re still waiting for your premium hike letter, it’s worth contacting your health fund now to find out when it will be issued and how much your premium will increase,” he said. The spread of notice timing and use of different communication channels raises questions about how effectively members are being prompted to review their cover before the new rates apply.
The survey results show a marked age difference in missed communications. Among Gen Z policyholders, 25% said they always miss their fund’s premium increase letter, the highest proportion of any cohort. That compares with 20% of Gen X, 17% of Millennials, and 13% of Baby Boomers. Separate Money.com.au research on intended responses to the 4.41% increase indicates that younger members are also more likely to say they will cancel or move their cover in the year ahead.
Across all age groups, 46% of policyholders said they plan to respond to the rise by cancelling, downgrading, switching funds, or adjusting policy settings. Within that group, 19% intend to cancel extras cover, hospital cover, or both; 18% plan to switch to another fund during 2026; 13% expect to increase their excess; and 12% are considering a downgrade in product tier, such as moving from Gold to Silver. Respondents could select multiple actions. In contrast, 54% of those surveyed said they expect to remain on their existing policy when the April changes come into force. The data indicate possible shifts in membership profiles, with younger adults more likely to change or cancel cover and older members more likely to remain, which may affect lapse rates and the mix of policies on books.
The 4.41% average rise will affect policyholders differently depending on product type and level of cover. Based on Money.com.au’s database, a family on a combined hospital and extras policy with an average current premium of $4,908 a year would pay about $216 more after the increase. A single policyholder on a comparable combined policy, paying an average of $3,264 a year, would see an annual rise of roughly $144. For hospital-only cover, a Gold hospital family policy is estimated to rise from $7,752 to $8,094, an increase of about $342 a year. A Gold hospital single policy is expected to move from $3,240 to $3,383, or around $143 more annually. Silver hospital family cover is projected to increase from $3,180 to $3,320, a rise of about $140. A Silver hospital single policy is expected to go from $2,244 to $2,343, adding around $99 a year. The figures are based on applying the 4.41% average to typical premiums in the Money.com.au dataset; individual outcomes will differ by insurer, state, product design, and approved rate change. The estimates offer an indication of how the April round may affect common policy types.
The premium approvals come amid rising claims and higher input costs in both hospital and medical services. Private Healthcare Australia chief executive Dr. Rachel David said funds are working to balance contribution rates with the rising cost of care, particularly for older members and those with complex conditions. “More people are using their health insurance for high-cost hospital care such as joint replacements and cancer treatment, and the cost of delivering care continues to rise. This premium increase reflects those realities. If health funds could keep premiums the same without jeopardising their ability to pay claims, they would. The industry is acutely aware of how tough many Australians are doing it right now,” David said. PHA has noted that the average 4.41% increase is below the 5% rise in the cost of providing medical and hospital services recorded in the previous financial year, meaning contribution rate growth is not fully matching underlying cost growth.
More than 15 million Australians hold private health insurance, including about 12.6 million with hospital cover. David said: “For every dollar spent on private health insurance, consumers receive an average of 85 cents back in healthcare benefits – the highest return of any type of insurance. Private health insurance continues to play an important role in supporting patient choice and easing pressure on the public hospital system.” The April premium round comes as many policyholders reassess their cover in light of rate changes, benefit design, and service availability, creating focus for insurers and distributors on clear disclosure of pricing outcomes and options.
