457 Visa Health Insurance Premiums To Increase In 2014

Every year, all of Australia’s health funds apply to the government to increase their health policies. This naturally impacts the price of 457 Visa Health Insurance cover with policies and prices normally increase in line with the funds average premium increase proposal. These price changes apply on the 1st of April 2014.

Based on government data, HIF created a useful graphic highlighting the approved increases of each health fund. From this graph, the key 457 visa health insurance funds overall increases in 2014 will be:

IMAN (nib) = 7.99% Increase
Australian Unity = 6.89% Increase
Medibank = 6.49% Increase
BUPA = 6.35% Increase
HIF = 2.89% Increase

It should be noted, that these increases are the average across their policy range and include a variety of policies from overseas student health cover (OSHC) and 457 visa health insurance through to permanent residency health cover.

Based on this data, it is critical for those looking to take out a new policy to not only view our comparison tables but also the projected increases by the funds. Unfortunately, most of the funds don’t publish the new 2014 policy prices until the 1st of April so the existing charts can’t be updated until all the new information is published by the funds offering 457 visa health insurance.

It’s critical to note that, in Australia the cost of health care has increased by 4.1% based on the Australian Bureau of Statistics (ABS). This includes the prices charged by hospitals, doctors and the number of health claims made by Australian’s (and 457 visa holders) last year to the 30th of September 2013. Based on this, it is expected that health insurance for 457 visa holder funds will need to increase their premiums to keep up with this trend (although most are well above this amount).

It’s also worth noting a new player Allianz ovhc has entered the market but has not been added to any comparison tables as there is no mention if the policies are Department of Immigration and Border Protection compliant which is critical for condition 8501.

Why Has nib (IMAN) Increased Their Health Insurance Premiums The Most?

nib (IMAN) currently has the lowest 457 visa health insurance policies for singles and couples. They also have a number of budget end products for permanent residency policies. It could be predicted that the increase is to make these policies more in line with the average competitor in 2014. Another possible reason, could be that the fund has had to adjust to new government regulation which penalises the firm that have a high proportion of younger policy-holders with a dividend being passed onto to other funds with older members. A final possible reason is that nib is a ‘for profit’ health fund that is listed on the Australian Stock Exchange unlike other funds such as HIF. This means the fund is required to pay dividends to shareholders while a fund like HIF are members-owners and any profit is distributed back to members with lower premiums. While this may be a general trend, it should be noted that Australian Unity is also a not-for-profit fund yet their policy increase is higher than HIF’s.

Is It Easy To Switch 457 Visa Health Insurance Funds? Are there penalties?

Absolutely! The Australian health insurance market is highly regulated by the Government and they have worked hard to make it very easy to switch from one fund to the other. With all funds you can switch quickly online (it normally only takes a few minutes) and all you need is your existing funds details. Common questions about switching are discussed below:

1) What happens to waiting periods when I switch?
In Australia many areas relating to pre-existing conditions have waiting periods (e.g. pregnancy). If you are currently going through a waiting period or have passed this period and switch funds you resume where you left off. If you increase your level of cover with the new fund and a new area is now covered that wasn’t before (e.g. Corneal Implants) you will need to commence a new waiting period for that specific treatment. This would be the same scenario if you increase your health policy with your existing fund.

2) Are there any switching costs?

No, the Australian government has specifically banned switching costs in the private health insurance sector. There are no penalties for switching funds.

3) Do I need to contact DIAC about my decision to change health funds

No. Your responsibility is to maintain adequate health insurance for the 457 visa (or any other professional visa such as the 485 visa). As long as the policy is DIAC (Department of Immigration & Citizenship) approved you will meet this requirement so you don’t need to notify DIAC of your policy change.

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