Lifetime Health Cover for Private Health Insurance

Lifetime Health Cover is a Federal Government initiative that commenced on 1 July 2000 and is designed to encourage people to take out hospital cover early in life and maintain it into later years.

In a sense, Lifetime Health Cover recognises the length of time a person has had hospital cover with a registered health fund and imposes a proportionally scaled premium loading regardless of their health status.

To lock in the lowest premiums for life under Lifetime Health Cover, a person needs to take out hospital cover with a registered health fund before the 1st July following their 31st birthday and maintain that cover.

If a person does not have hospital cover by the 1st July following their 31st birthday and decides to take out hospital cover later in life, they will pay a 2% loading on top of the base premium for every 1st July that has occurred between their 31st birthday and the time they join. For example, someone who first takes out hospital cover at age 40 may pay 20% more than someone who first took out hospital cover at age 30.

People who were born on or before 1 July 1934 are exempt from Lifetime Health Cover and are able to join a health fund at any time in the future and pay the same premium as someone who takes out cover at age 30.

One of the stated aims of the Lifetime Health Cover initiative is to slow the rate of premium increase by discouraging "hit and run" behaviour (where someone joins a health fund just before requiring treatment and then leaves soon after) and by reducing the average age (and thereby improving the overall health) of private health insurance fund members so that the rate of claiming is reduced.

Removal of the rebate on Lifetime Health Cover from 1 July 2013

If you currently pay a LHC loading, as of 1 July 2013, the Rebate will no longer apply to the LHC component of your hospital cover premiums. You will still receive the Rebate on the standard component of your hospital cover.

More information about Lifetime Health Cover