Health insurance question couples need to ask

From potential hidden costs to the benefits of combining your health insurance policies with a partner, here’s what you need to know before you commit.

When you share your home, your life, and most other expenses with that one special person it seems logical to go in together on health insurance, doesn’t it?

But is couples health insurance always the most beneficial option?

If you both want the same things from a health fund and you value convenience, it could be. On the other hand, if saving money or starting a family are high on your list of priorities, you may want to seek out alternative arrangements.

How does couples health insurance work?

Essentially, couples health insurance policy provides coverage for two cohabiting adults in a romantic relationship. Importantly, it covers both parties for the same things. So, if you and your significant other are in a shared health insurance arrangement, you both get an equal number and type of benefits; the same level of optical, the same dental, ambulance, chiropractic or whatever comes with the policy you choose. Depending on the policy, coverage can be allocated per person (e.g. $150 in optical rebates each) or in combined limits (e.g. $350 in dental rebates all up to be divided between the two of you as you decide or as the need arises).

What does couples health insurance cover?

For the most part, it covers everything single health insurance policies provide. You can choose Hospital and/or Extras and within those choices, you can select different levels of services depending on your needs and budget.

RELATED: What is Extras health cover?

What are the benefits of having couples insurance?

Convenience is a big reason. If you share money or if one of you always does the household admin, having one premium and one payment arrangement is an easy option.

If you value the convenience that comes with one single premium and payment, couples health insurance could be for you. Picture: iStock.

Does couples insurance cost less than singles insurance?

For the most part, a joint policy costs the same as having two identical single policies.

Australia’s private health insurance is based on a system of community rating, which means people can’t be discriminated against or favoured based on whether they are in a couple or not. As stated on the Private Healthcare Australia website, “Community rating means that everyone is entitled to buy the same product, at the same price, and is guaranteed the right to renew their policy.”

Do I have to pay the medicare surcharge if I have couples insurance?

The Medicare Levy Surcharge (MLS) is a tax you pay if you don’t have private health. It is a 2 per cent surcharge that applies to singles who have a taxable income of more than $90,000 and couples whose taxable income is more than $180,000 combined. People in these camps can avoid paying it each year by taking out adequate private hospital cover.

It’s also worth taking into consideration your combined income in relation to the Australian Government Rebate. The rebate was established to help with the cost of hospital, general treatment and ambulance premiums. You can claim more from this rebate if you earn under $90,000 as a single or $180,000 as a family. The percentage you can claim also increases with age.

How does the lifetime health cover loading work in a couples policy?

You may already be aware that if you don’t take out private patient hospital cover before you turn 31, you will incur the Lifetime Health Cover (LHC) loading. Essentially this means that you are required to pay an extra 2 per cent on top of your health insurance premium for every year you are more than 30 years old.

How that works in a couples insurance scenario is as an average. For example, if your loading was 6 per cent and your significant other had a 2 per cent loading, there would be a 4 per cent LHC loading applied to your premium. If one of you had insurance before you were 30 and the other has a 4 per cent, the couples policy loading would be 2 per cent.

Before you commit to any kind of cover, make sure you calculate your LHC loading to see if you’ll actually save money with couples cover. Picture: iStock.

Can unmarried couples have couples insurance?

Insurance companies generally consider married, de facto or registered couples eligible for couples insurance policies. If you break up and are no longer in a romantic relationship, you are no longer eligible for couples insurance and will need to change to a singles policy.

What happens if you have a baby?

Most health insurers have a minimum of 12 months waiting period on pregnancy, birth and even post-natal related expenses, so plan ahead if possible. In fact, if you are thinking about starting a family, you may want to look into policies that offer pregnancy-related benefits like obstetrics and reproductive-related treatments like IVF. A singles policy may work out better in that scenario – after all, only one of you will need many of the services.

Once you have a child, many insurers will require you to switch to singles or family cover to ensure your baby has health insurance.

Is couples insurance right for you?

Start by asking yourself these questions.

Do my partner and I want/need the same thing from health care insurance?

Is it easier to have one premium and one payment set up between us?

What LHC will we incur together?

How will our combined income impact the Medicare Levy Surcharge?

Are we planning on starting a family? If so, how soon?

This article was created in sponsorship with iSelect