Lifetime Health Cover Loading: Why Procrastination Could Cost You Big Time

Lifestyle + Spending
Written By SOTM Team

Okay, besties, let’s talk about something super unsexy but really important: Lifetime Health Cover (LHC) loading. Yep, it’s one of those sneaky little government rules that could have you forking out way more for health insurance just because you waited. So if you’re over 30 (or creeping closer), this one’s for you.

So, What Is Lifetime Health Cover (LHC) Loading?

Basically, LHC loading is like a financial slap on the wrist for not getting private hospital cover before July 1st after you turn 31. For every year you don’t have cover, your future premiums will go up by 2%. And that adds up real quick.

The worst part? It can go up to 70% more. Yep, you read that right. But there is a light at the end of the tunnel — after 10 years of continuous cover, the loading disappears. Bye-bye extra fees!

Let’s Break It Down

To really drive it home, here’s a quick scenario for you:

  • Base Premium: $100 per month (just for example's sake)

  • LHC Loading Rate: 2% per year over 30

If you wait until 40 to get cover, you’re paying an extra 20% per month. That’s a casual $2,400 more over 10 years. And if you leave it till 60? Say hello to a 60% loading. That’s an extra $7,200. Ouch.


Why You Should Care (Even If You’re Healthy)

  • Long-Term Savings: The sooner you get covered, the less you’ll pay in the long run. Even basic hospital cover can save you big bucks.

  • Peace of Mind: Private hospital coverage means shorter wait times, more choice in hospitals, and access to specialists when you need them.

  • It’s Temporary: If you’ve copped the loading, don’t stress too much. It drops off after 10 years of cover. You just need to stick with it.

What Should You Do Now?

If you’re under 31, consider this your gentle nudge to look into private hospital cover. Even a basic policy can lock in your rate and keep the LHC loading monster at bay. And if you’re over 31? It’s still worth considering. The longer you wait, the more it costs.

Not sure where to start? Check out comparison sites or have a chat with a financial advisor to find something that suits your vibe and your budget.

Stay savvy, friends!

***Please remember our blogs aren’t intended as financial advice - they’re intended only as a starting point to give you a little extra info! For more in-depth advice catered to your personal financial position, please see a certified financial advisor.



SOTM Team
Next

Now that Labor has won… what does this actually mean for your finances?