If you’re thinking about hospital cover, June is the month to do so.

That’s because of a financial loading applied to private hospital insurance known as Lifetime Health Cover (LHC) loading, which encourages people to take out hospital cover at a younger age.

How does it work?

If you sign up for hospital cover before 1 July following your 31st birthday, you avoid paying LHC loading. Simply, you pay lower premiums compared to someone who joins when they are older.

Those who are 31 or younger who take out private hospital insurance are exempt from LHC for as long as they maintain their cover.

But as it's applied at a rate of 2% for every year you are over 31 (to a maximum 70%), there's benefit in taking out cover sooner rather than later even if you've already blown out 31 candles.

It's also worth remembering that the loading you pay will only be removed once you have 10 years of continuous hospital cover.

What else do I need to know?

  • LHC loading only applies to hospital cover, not extras.
  • If you take out hospital cover when you’re 31 or younger but cancel it and then purchase it once you’re older than 31, the loading will be applied.
  • Australian citizens or permanent residents who are overseas on 1 July following their 31st birthday will have an extra 12 months to purchase hospital cover before they are charged the loading. You will need to obtain an International Movement Record. This is available from the Department of Home Affairs.
  • New migrants aged over 31 will not have to pay LHC loading if they take out hospital cover within 12 months of applying for interim or full Medicare benefits.
  • Exemptions also apply to members of the Australian Defence Force or holders of Department of Veterans’ Affairs Gold Card.

What next?

Latrobe Health Services has a range of hospital and extras covers to suit every situation. Compare our products or get a quote on private health insurance and take control of your health.

You can find out more information about the LHC loading and private health insurance generally on the Federal Governnment’s private health website.