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7 Tips for Buying Health Insurance for the First Time

7 Tips for Buying Health Insurance for the First Time
Georgia Carter Updated: 29 July 2021
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Health insurance is a complicated topic, with many people choosing not to think about it until it’s too late. However, have you ever considered what would happen if you never apply for cover. What will happen if I get injured and have no coverage? How much money do my savings hold right now, but what about in the future? Is this going to be worth the cost of paying for expensive premiums every month that may not pay off until down the line when one day I might need some serious medical attention?

Private health insurance plans are a way to ensure that your family is protected from the high costs of medical care. This article will explain how private health insurance policies work, what they cover and don’t cover, as well as answer all of your questions about purchasing one for the first time.

Key facts

  • There are many different health insurance companies and policies to choose from. It’s important to research and compare companies, policies, and prices before making your final decision.
  • There is a list of terms that you must familiarise yourself with if you purchase health insurance.
  • There are three types of health insurance policies: Hospital Cover, Extras Cover, and Ambulance only Cover.
  • There are specific documents you must have to apply for health insurance.

What is private health insurance in Australia, and why do I need it?

If you are an Australian citizen, it’s highly recommended that you take out a health insurance policy. Various types of health insurance cover the expensive costs of healthcare services. Hospital cover allows you to be treated as a private patient in private Australian hospitals. In contrast, an Extras policy will cover you for all those out-of-hospital health services, such as dental care and physiotherapy.

Additionally, you may want to take out private cover because the out-of-pocket costs can prove to be increasingly more expensive than health cover itself. In addition, if you purchase a policy after your 31st birthday, you will have to pay the Lifetime Loading Cover fee.

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Understanding the basics of health insurance in Australia

There is a wide range of factors that make up health insurance, such as specific fees and beneficial programmes that come with taking out health insurance. It’s important to understand what each of these terms means and relate to choosing the health insurance policy that best suits both you and your family.

Here are a few definitions for key health cover terms:

Types of health insurance policies

There are typically three types of insurance policies you can choose from. Each different type of policy covers certain healthcare benefits, services, and procedures. It’s significant to remember to review the different types to make the best decision for your healthcare needs.



A Hospital policy covers in-hospital treatments and services. Depending on your policy level, you could receive cover for surgeries and hospital stays. This often includes ambulance transportation and accommodation, as well as access to various private hospitals for both you and your family.



An Extras policy covers all of those out-of-hospital treatments, such as dental and optical care. Depending on your level of cover, you can claim money back on various services, such as physiotherapy and psychology appointments. You also gain the opportunity to join the no-gap dental programme and save money for you and your family’s healthcare and wellness requirements.



An Ambulance only policy covers the expense of being transported in an ambulance and any treatment required during the ambulance transportation. Ambulances can prove expensive without cover, but by purchasing cover, you can ensure the emergency treatment and hospital transportation for you and your family is secure.

7 Tips for buying health cover for the first time

When it comes to purchasing health insurance coverage for the very first time, there are a few things you need to know to make the decision that best suits your healthcare needs:

  1. Decide what type of cover you need: Before taking out cover, you must reflect on your and your family’s health care needs and requirements. Is there someone in your home that needs to go to the hospital often? Or do you require more optical care than what is normally expected? Whatever the services are that you need most, choose the healthcare policy that best fits those requirements.
  2. Consider your budget: There is a wide range of policies available to suit different budget types. The most affordable monthly rates will cover the bare minimum, while the most expensive health insurance policy will most likely cover every treatment. It’s important to analyse your monthly budget and choose a policy that best suits your needs. You can always switch to another option in the future.
  3. Compare policies from a variety of insurers: There are many insurance companies that provide customers with a wide range of policy levels to choose from. With so many out there, you can likely find the cover you’re looking for at a more affordable rate at a different health insurance company. It’s therefore important to research and compare the various policies and companies to ensure you’re choosing the best cover for you.
  4. Look for a policy suited to your current phase of life: Whether you require major dental care, are expecting to spend time in hospital, or have a family member that may require an ambulance at any moment, there will be a policy out there that covers your current healthcare needs. Ensure to reflect on your current healthcare requirements and pick the policy that caters for you best.
  5. Make sure you know how much the policy costs and what it covers: Nobody wants to pay more than they expected each month. Before taking out health insurance cover, be sure to remind yourself exactly what the costs are, what benefits come with the specific level of cover, and any restrictions and waiting periods that come with it.
  6. Check what you’ll need to pay out-of-pocket: Certain levels of coverage do not include specific health care treatments and services. You, therefore, may have to pay extra expenses on various treatments, such as dental or optical, if you have not taken out an Extras cover. Remember to remind yourself what you will have to pay should your policy not cover it.
  7. Learn about exclusions and waiting periods on your policy: Different policies and levels of coverage come with their own unique set of restrictions and waiting periods. This means you may have a monetary cap on specific treatments and services that your policy will not fully cover. In addition, certain policies come with waiting periods that can range from two months to two years. It’s important to familiarise yourself with these before taking out your policy.
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Which documents are required when applying for health insurance in Australia

There are certain documents you absolutely must have up to date and ready when signing up for health insurance cover. This includes:

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How much does private health insurance cost

The average Hospital policy costs around $2,000.00 a year, while the average Extras policy costs about $850 a year. However, it’s vital to note that the rates and costs of health insurance policies, whether an Extras or a Hospital cover policy, will differ depending on your healthcare requirements, age, pre-existing conditions, lifestyle, and budget.

How to compare health insurance quotes

To compare quotes on specific health insurance companies and policies, you can fill in a quote form above or speak to our specialists for assistance by giving us a call on 1300 743 254. Once you’ve received a number of quotes, you can go through them yourself and compare prices, level of coverage, and benefits.

Frequently asked questions and answers.

  • How do I get health insurance for the first time?

    First, research what type of health insurance you’d like to take out and think about your healthcare requirements and your budget limits. Then, look up several health insurance companies and compare policies and prices. If it’s overwhelming to do this on your own, you can contact one of the many health insurance advisors or brokers to help you navigate through the information. Once you’ve analysed your choices and made the decision that you feel best suits you, you can take out your cover with immediate effect.
  • How much is health insurance a month for a single person?

    The cost per month or year for health insurance coverage and policies differ depending on your healthcare requirements and your budget limits. However, generally speaking, it can cost a single person around $43 to $1,150 a month for health insurance cover.
  • Is it better to pay out of pocket or use health insurance?

    Out of pocket costs will prove to be more expensive than health insurance in the long run. Hospital and ambulance fees can amount to a hefty toll if you have decided not to take out health insurance. Purchasing a health insurance policy can cover a wide range of either in-hospital or out-of-hospital treatments, services, and procedures that will prove to be more affordable than paying upfront.
  • Should I get private health insurance in Australia?

    It is recommended that you take out private health insurance if you are an Australian citizen as it can be cheaper and more budget-friendly in the long run, save you money when it comes to medical emergencies, and you can receive a wide range of benefits, such as discounts off gym memberships or no-gap dental care. In addition, if you purchase health insurance before you’ve reached the age of 31, you will not have to pay the Lifetime Loading Fee of an increased 2% per year.
  • What happens if I never use my health insurance?

    If you have purchased a healthcare insurance policy but have never claimed back or made use of your cover, any out-of-pocket costs will not be deductible. However, you will still be required to pay for your policy even if you never use it. Therefore, it is important to regularly reflect on your current health and lifestyle to ensure you are not spending money unnecessarily.

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