Recent analysis from Canstar has indicated that some private hospital insurance premiums in Australia have significantly surpassed the government’s stated average increase of 3.73%, which took effect on April 1.
The data showed that individual Gold-tier policies rose by 13.8% on average, equating to an additional $442 per year.
Family policies at the same coverage level experienced a comparable increase, with average premiums reaching $7,207 in June – up $858 from March.
These figures point to a widening gap between regulatory averages and the real-world pricing decisions of individual insurers.
The pricing discrepancy was not consistent across all tiers.
Bronze and Silver categories saw relatively modest adjustments, ranging between 1.5% and 5.2%, while Basic-tier cover recorded a slight decline.
The Gold tier, however, absorbed the most substantial price increases, underscoring its sensitivity to broader cost pressures.
Canstar’s findings suggested that health funds used their pricing discretion to apply increases variably, sometimes significantly exceeding the headline rate.
Canstar’s data also illustrated the cost-saving potential for policyholders willing to change insurers.
Individuals on Gold policies could save up to $1,296 annually by moving to a lower-priced option that maintains the same level of cover. Families could save up to $2,493 under similar conditions.
The analysis, based on a review of policies across states and territories, incorporated the Australian Government Private Health Insurance Rebate and excluded policies in the “plus” tiers.
Premiums also diverged notably by location.
For instance, individuals in Victoria and Queensland face some of the highest average Gold-tier premiums, while consumers in the Northern Territory and Western Australia enjoy the lowest.
These regional variations reflect differences in market competition, service delivery costs, and insurer pricing strategies.
The figures come as Australians with hospital cover make an average of two claims annually, according to a separate study conducted by Money.com.au.
Fifty-one percent of respondents reported one or two claims a year, while about one-third said they had never used their policy.
Older demographics were more likely to utilise their insurance. Baby Boomers topped the usage charts, with 68% making one or two annual claims. Younger cohorts such as Millennials and Gen Z were less likely to claim and more likely to have never done so.
In a related survey focused on extras cover – services like dental, physio, and optometry – Money.com.au reported that single policyholders were less likely to claim frequently.
Forty percent of singles reported just one or two claims per year, compared with higher usage among couples and families.
Despite the introduction of a four-tier classification system (Basic, Bronze, Silver, Gold) in 2020 aimed at simplifying private hospital insurance, more than half of respondents said they only partially understood the model. An additional 13% found the system just as confusing as before.
