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How to find the best health insurance for families

Get useful tips and compare what's on offer from Medibank, Bupa, HCF, HBF, NIB and more to find the best deal.

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Last updated: 27 February 2020

Need to know

  • Health insurance premiums will go up on 1 April – now’s the time to review your policy and make sure it's the best for you and your family
  • Check which benefits your fund offers for children on your policy – these can vary between providers
  • Two-parent families often pay the same premiums as couples (which means their kids are effectively insured for free), but single parents are charged extra, so shop around

Finding out which health insurance policy is right for you depends on which life stage you're at. A policy that suits a young family will likely not be the best option for a pensioner, for example. 

If you're a two-parent household with children and you want hospital cover, this article explains what to look for in a health insurance policy. 

If you're a single-parent household, you'll also find this article useful, but we have some additional advice in How to choose the best health insurance for single-parent families

The four tiers of health insurance

Health insurance policies are categorised into four tiers:

  • Basic – very little if any cover in a private hospital
  • Bronze – low cover
  • Silver – medium cover
  • Gold – full or top cover

In between these main tiers there are also Silver Plus, Bronze Plus and Basic Plus policies that cover at least one service more than the normal Silver, Bronze or Basic policies. For example a Silver Plus policy could include cover for pregnancy or cataract surgery (services usually only covered under Gold policies).

What to look for in health insurance for kids

Many health funds offer special benefits for children. If you're taking out health cover for your kids or switching to a better deal, keep an eye out for these features.

1. No excess or co-payments for children

These funds told us they don't charge an excess or co-payment for children who need to go to hospital on some or all of their family and single-parent policies.

CHOICE tip: Basic, Bronze and Silver policies (with some cover restrictions) often do charge an excess for children, so check the fine print before you sign up.

2. Free or discounted extras 

Some funds offer free or discounted extras services for children, such as dental check-ups or discounts on glasses. Note, though, that you'll usually need to visit preferred providers to take advantage of these benefits.

3. Extended coverage for older children

Most funds let you keep your children on your policy until the age of 25 if they're a full-time student, or if they live with you and they're not married or in a de-facto relationship.

The age limits vary for dependent children who aren't full-time students, for example, if they study part-time or work as an apprentice – so again, it pays to shop around if your product disclosure statement says your children are no longer insured on your policy.

Some funds also offer policies for families with dependent children who aren't full-time students for an additional cost. 

CHOICE tip: If these benefits aren't mentioned when you get a quote, just ask.

Things to think about once the kids leave home

Should you downgrade to a couples policy?

As couples mostly pay the same for health insurance as families there's no real advantage to switching to a couples policy.

However, as you both may have different needs, especially for extras services such as dental, optometry and physio, it may make sense to switch to different singles policies. Singles policies usually cost half as much as a family or couples policy. 

Should you downgrade to cover without pregnancy?

If you're done having kids, you may consider downgrading to a policy that doesn't include cover for pregnancy and fertility (such as a Silver Plus policy as opposed to a Gold policy). 

But be wary – many of these Silver Plus policies that don't include cover for pregnancy are more expensive than the best Gold policies. This is because people who don't need pregnancy cover tend to need cover for things like hip or knee replacements, which are very expensive for insurers so they price those policies accordingly.

Many Silver Plus policies that don't include pregnancy are more expensive than Gold policies

Even though you might be happy to take out a policy that restricts conditions you think you won't need – for example, pregnancy, fertility treatment, sterilisation and gastric banding, keep in mind that with these kinds of policies, health funds can change and add to the procedures that they exclude or restrict. 

So, unless you keep track of all the material the fund sends you and you regularly check your policy, you might find yourself without cover for something you'll actually need. Which means you may be better off with a Gold policy that covers everything, as funds are much less likely to add restrictions to those.

Five steps to better, cheaper health insurance

Our health insurance experts have put together a handy five-step action plan to help you through the process of reviewing, comparing and switching your health insurance policy. 

Just a few minutes could potentially save you hundreds of dollars per year: one of our CHOICE editors saved herself over $1800 annually just by reviewing and switching cover for her young family. Follow these five easy steps:

Jargon buster

  • Excess – An extra amount, such as $500, charged once per hospital stay. It usually applies once (single) or twice (couple and family) per year.
  • Co-payments – An extra amount, such as $70, that you pay per day while in hospital. It's usually capped per hospital stay or per year.
  • Preferred providers – Health funds sign up dental practices or optical stores as part of their preferred provider network. Some clinics are even owned by the fund. Preferred providers may offer a discount to a health fund's members, or the health insurer may pay members higher benefits if they go to preferred providers. For example, instead of a set dollar benefit, the fund may pay a percentage benefit, such as 75% of the bill, which can result in lower out-of-pocket costs.

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