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Private health insurance laws

Under private health insurance law, health insurers must be registered. They must provide cover to anyone who seeks it and let you know in advance about any changes to your policy. Health insurers must also follow strict rules for things like premium increases and waiting periods.

Laws and rules

The Private Health Insurance Act 2007 is the main law that sets out the requirements for private health insurance and health insurers.

Private Health Insurance Rules sit under this law. They provide more detail about different areas of private health insurance.

View the other private health insurance laws on the Federal Register of Legislation.

Who can provide private health insurance?

Organisations who want to provide private health insurance must register under the Private Health Insurance Act 2007. View the list of registered health insurers.

Access to private health insurance (community rating)

Unlike other types of insurance such as car and life insurance which are generally risk-rated, community rating means health insurers must:

  • charge everyone the same premium for the same product
  • provide cover to anybody who seeks it
  • not charge different premiums based on:
    • past or likely future health
    • claims history
    • age, pre-existing condition, gender, race or lifestyle

Health insurers can restrict their members to a certain industry or group.

Premium increases and changes

Health insurers must apply to the Minister for Health for premium increases. This happens at the same time each year. Premium changes take effect from 1 April each year.

Find out more about the process behind premium increases and what you can do if you want a cheaper policy.

Waiting periods

If health insurers choose to impose waiting periods on providing insurance for hospital services, they must be no more than:

  • 12 months for pre-existing conditions
  • 12 months for pregnancy and birth-related services
  • 2 months for psychiatric care, rehabilitation or palliative care (even if it’s for a pre-existing condition)
  • 2 months for all other services

Health insurers must not impose a waiting period if you upgrade your psychiatric care cover (once in your lifetime). 

Health insurers can set any waiting period for extras cover.

Health insurers must not make you serve extra waiting periods if you switch to a new policy that offers the same level of benefits as your old policy. This applies even if you move to a different insurer.

Find out more about waiting periods and your right to change.

Communicating with policy holders

Health insurers must:

  • give private health information statements to you — these describe the features of the policy and explain what is covered
  • let you know in advance if your premiums will increase or your policy will change — this gives you time to shop around if you want to find a different policy
  • let you know if you have to pay for any costs for covered treatments or services out of your own pocket — this is called informed financial consent

Paying for prostheses

Health insurers must pay benefits for a range of prostheses including those that:

  • you receive in hospital
  • are covered by your private health insurance
  • are implanted or applied by a service covered by Medicare

Find out more about prostheses and private health insurance.

Last updated: 
15 April 2019

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