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When the need for health insurance is the greatest an alarming proportion of consumers over 50 are cancelling their health insurance for affordability reasons. This at a time where there are concerns for the future funding of health care costs in New Zealand.
The reality is in the future people are going to have to pay a greater share of their heath costs and with costs escalating (refer chart) at an alarming rate it makes sense to have health insurance.
What is not generally known is that there are options which will resolve the affordability issue.
This option comes in the form of a voluntary excess. An excess is the amount of money you’ll need to contribute towards the total cost of any claim you make for each diagnostic investigation or treatment.
If your policy excess is $1,000 and you have a health claim costing $12,000, the insurer will pay $11,000 and you’ll need to contribute $1,000.
Having a higher excess will still protect you against the bigger treatment costs, allowing you to self insure to a degree that you are able to handle.
For example of a couple both aged 55. With the standard no excess plan their annual premium would be in the vicinity of $3,500 depending on their chosen insurer but by nominating a $1,000 excess the annual premium would reduce to approximately $2,600 an annual savings of around $900 in the first year alone.
Another way to save money is to buy your health insurance online. Some online brokers will now rebate up to 30% of the first years premium by way of a commission rebate that was paid to them by the insurance company for your business