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Young consumers seek fairer health insurance deals

What do young consumers want?

A fairer deal from their health insurance provider!

When do they want it?

Before their own health insurance premiums helped subsidise the healthcare needs of 'boomers'.

That's what the findings of a new survey that asked under-35s their attitude to health insurance reveals.

The survey was commissioned by the Private Health Insurance Intermediaries Association (PHIIA), the industry body representing comparison services and brokers. It highlights intergenerational challenges, such as the subsidy that younger people pay to older members to help fund services including home nursing support services and hearing aids.

Under-35s want affordable health insurance policies

What the under-35s want in health insurance is better value, more tailored cover and access to affordable policies that include dental, ambulance, more accessible mental health care services and greater access to other services not yet available, such as GP visits and prescriptions. More than half (53%) of the survey's respondents admitted the barrier to getting health insurance cover was lack of affordability. But for those left to access the public system, only 15 of those surveyed believed that system met their needs adequately. 10% planned to take out health insurance cover when they turned 30.

Dental cover inclusions would make them smile

Dental cover ranked the highest choice for inclusion for in-hospital (59%), such as for wisdom teeth surgery, with 69% of respondents interested in extras for check-ups, hygiene appointments (teeth cleaning) and related services.

The survey highlighted that the 'sticks and carrots' of tax and loadings, which only apply to hospital cover, led to 25% of respondents taking out insurance. However, three-quarters of all insured respondents also took out extras – a sign that they found value in its offerings.

"The clear message is that younger people want items they feel are relevant and can use, such as dental, mental health and GP's. When they discover how the system works, they are shocked they are subsiding 'Boomers' policies," said PHIIA CEO Christopher Zinn.

Under-35s don't want hearing aids - not yet, anyway

29% of survey respondents said they didn't want hearing aids included on their policy. And although only 3% accessed mental health services as an extra in the past 12 months, 48% of those surveyed said they would like it included if they could tailor their cover – a request that highlights the gap in demand versus affordability.

Similarly, when it comes to in-hospital dental treatment such as wisdom teeth removal, 19% had used their cover, but 56% said they like it in a tailored policy.  

Cover offering protection for accidental injury is another clear priority for younger Australians. A whopping 74% of respondents nominated accident cover as a key inclusion in their ideal private health insurance policy. 

Survey Matters conducted research on behalf of PHIIA in June 2023 via an online survey of 302 consumers across Australia. Respondents were between the ages of 20 and 35 and were an even mix of those who currently have private health insurance and those who don't.  

The bottom line

Whether they have it yet or not, the survey's results highlight that under-35s see the value of health insurance. The fresh ideas this cohort can bring to the health insurance industry table have the potential to improve the offerings from Australian insurance providers by reminding them that tailoring cover in ways that reflect an ongoing evolution of individual needs can only be a positive thing for the entire industry.

Go deeper: Benefits of private health insurance