Health insurance: why should you have it and what should you look for?

We’ve got it. We don’t use it much. And with respect, health insurers make their story a hard one to sell.

The insurers’ premiums go up by multiples of inflation every year, approved by governments, who use penalties to try to force many to take it out.

That is, we get shoehorned in by governments with a game of carrots and sticks, without the carrots.

Who does the government want to have health insurance? Gen Xers more than most others. Because we earn the most, and we’re relatively healthy. We can therefore contribute to the insurance pool without, on average, needing to take so much out.

Governments also want you insured before you turn 31 – an age long farewelled for Gen Xers.

If you take it out after that, they’ll slug you an extra 2 per cent a year for each year you’re over. Take it out when you’re 40 and you’ll pay a 20 per cent loading for 10 years.

Next, governments believe higher earners should have it. If you earn more than $90,000 as a single, or $180,000 as a couple, you either take out insurance, or get slugged a higher income tax rate.

Nope, they don’t make their pitch easy.

But at some stage of your life, you’ll probably get sick, or have an accident. And if you want to choose your doctor and when you get something done, then that’s when you’ll be glad you’ve got private health cover.

Then it just comes down to the “optional extras”, such as dental and optical. Compare carefully.

Bruce Brammall is the principal adviser with Bruce Brammall Financial (www.brucebrammall.com.au) and author of Mortgages Made Easy.