Churning Private Health Insurance
One surefire way for me to save about $500 a year takes me a total of about an hour every year to do.
That’s $500 tax free dollars in my pocket, 500 cold hard bucks handed to me for doing jack all. Well.. nearly jack all.
Remember, the loyalty tax applies to many things, private health insurance is no different. I am all for minimal effort, easy savings and here is one of my favourites that I have been doing for years.
I personally hold basic private health insurance cover for 2 things:
- To stop myself paying the Medicare Levy Surcharge (MLS) – cheap private health hospital cover is likely cheaper than the MLS
- To pay for my 6 monthly dental cleans
Disclaimer: I am younger than 30, single with no pre-existing health conditions and do not foresee any reliance on the private hospital system at present
Throughout the year, many private insurers incentivise new customers to them by offering a deal such as 6 weeks free or 8 weeks free. These come with conditions, most common ones include:
- Having to stay for 2 months
- Get 6 weeks free for staying 2 months and another 2 weeks free if you stay for a year
- Be a ‘new’ customer: Have to not have held any private insurance from them for the last 30, 60 or 90 days
- 6 weeks free only if you sign up to certain level of cover
Method
Step #1:
Find out how much you are paying in health insurance at present
Log into your current health insurance portal and find out how much you are paying
The goal is to sign up to an equivalent level of health insurance cover for your individual needs
For a 30 year earning $125,000 per year – bare bones basic hospital cover is approximately $50 a fortnight or just a tip over $100 a month
Step #2:
Find a new insurer offering a sign up offer
There are plenty of options available: my favourite 3 are: AHM, Bupa, NIB.
Read the terms and conditions and make sure you are in the clear
Step #3:
Sign up to new private insurer – don’t forget to put in the promotional code at checkout!
During sign up, there will be a questions such as:
- “Are you switching from another private insurer?”
- “Do you allow ____ to contact ____ for a copy of your transfer certificate?”
The answer to both of these is yes, as you want the new private insurer to contact the old insurer to let them know you are leaving, to cancel the policy and move all details over to the new one.
This is the magic part, no phone calls, no emails, none on hold
In my experience, transfer certificates can take as little as 1-2 days or sometimes 2-3 weeks depending on the insurer. In the meantime, the old insurer will refund the premiums paid during this time anyway
Step #4:
Enjoy the free money
Case Example
For example the single 30 year old who is currently paying $100 a month to hold private health insurance.
His total bill for the year over 12 months is: $1200 if he stayed with the same insurer
If he switched once and took advantage of a 6 week free offer: He would only have to pay for 10.5 months: his total bill for the year is $1050, a saving of $150.
I personally do it 3 times a year, some sign up deals go for as big as 10 weeks free at times. I get about 5 months of free premiums a year doing this: that’s a saving of $500.
The best part is, if you have higher premiums than this, the savings are proportionally larger.
Someone paying $200 a month can save up to $1000 a year.
Things to Consider
- Switching private insurers may change waiting periods and change extras limits available to you.
On a high level, waiting periods served for an equivalent level of health cover- when switching insurers- you will not have to re-serve these waiting periods. - Limits used on extras carry over to your new insurer. Example, I had a dental clean and used $150 dollars in February 2025. I switch private insurers, new insurer offers an annual limit of $400 for general dental – my limit remaining is hence $250 dollars for the year.
While waiting for a transfer certificate, no extras claims can be made - Do not pay the full years premium if you plan to switch
BONUS Tip
Before you go and switch insurers, call your current insurer. Speak to them about how you want to leave and what the process to get the transfer certificate is, as you have seen a better sign up deal with another insurer ( have this information ready).
It is likely that as part of your retention, they may match the offer or give you some weeks free to sway your decision to change.
There is no stopping you accepting their retention offer, then after the free weeks you receive, switching to your new one.