How long can an adult child stay on their parents health insurance?

Young Australians are struggling. 

According to Monash University’s 2024 Australian Youth Barometer, 88% of young Australians experienced financial difficulties over the last 12 months, and 62% believe they will be financially worse off than their parents. 

But young Australians may now be eligible for some financial relief on their health insurance.Thanks to a federal government initiative, some health insurers now allow dependent adult children to stay on their parents’ health insurance up to the age of 31. However, various conditions apply and many people are asking whether it makes financial sense for a young adult to stay covered by their parents’ policy.

• Some health insurers will include your dependent adult children on your current policy for no extra cost if they are aged under 25, are full-time students and aren't married or in a de facto relationship.

• If your dependent adult children are not full-time students, you may need to pay extra for Extended Family Cover.

•  Once your adult child turns 31, they’ll need to take out their own health insurance policy in order to avoid  Lifetime Health Cover (LHC).

How long can you stay on your parents' health insurance in Australia?

In Australia, an adult dependent can only remain on their family’s insurance policy up to a set age limit. The government has increased this age limit to 31.

However, this is a guideline only, and the actual age limit varies from insurer to insurer. Some major health insurers, such as BUPA and HCF, are following the new guidelines from the government and have implemented a new type of cover called Extended Family Cover. 

What is Extended Family Cover?

Some health insurers offer Extended Family Cover that parents can use to provide health insurance for their adult children. 

• Some Extended Family Cover policies allow for the inclusion of adult children, particularly those who are students or not yet financially independent.

• However, premiums for Extended Family Cover are generally higher than standard family policies, given the broader coverage.

• Not all insurers offer Extended Family Cover, and the options available can vary widely between providers.

Can I add my adult child to my health insurance?

If your insurer offers extended family cover, your dependent adult child may be able to re-join your eligible policy up to the age set by your insurer.

However, each insurer will have different requirements for adult children re-joining their parent’s policy.

For example, some insurers may require adult children to re-serve their waiting periods before being able to fully use their parent’s cover.

Which health insurance providers allow you to stay until age 31?

Answering the question: ‘How long can an adult child stay on their parent’s health insurance?’ can be complex. 

That’s because while the government did increase the family coverage age limit to 31, not all health insurers offer that option to their customers. 

At the time of writing, the following health insurers may offer Extended Family Cover up to the age of 31:

• Bupa

• Medibank

• HCF

• NIB

• Australian Unity

• AHM

• Teacher’s Health

Also keep in mind that eligibility criteria often applies. While this typically varies between insurers, general eligibility criteria may include:

• Marital status: The dependent must typically be unmarried and not in a de facto relationship.

• Financial dependency: The dependent may need to be financially dependent on the policyholder or be a full-time student.

• Income threshold: Some insurers impose an income limit, where the dependent must earn below a certain amount to qualify.

Many health insurance providers offer incentives in the form of ‘age-based discounts’ for young adults who choose to take out their own policy. This can be as much as 10% discount on yearly premiums for anybody aged between 18 and 25. This can be as much as 10% discount on yearly premiums for anybody aged between 18 and 25.

If you’re keen to keep your children covered when they reach adulthood, Compare Club’s specialists can help find policies with higher age limits.

Should I keep my kids on my family policy or ask them to get their own cover?

Whether it's cheaper to keep your adult children on your policy really comes down to the terms and conditions of your policy.

For example, some health insurers will include your dependent adult children on your current policy for no extra cost if they are full-time students and aren't married or in a de facto relationship. 

In this case, it may make more financial sense to keep your adult children on your family policy than asking them to take out their own singles cover. 

However, if your dependent adult children are not full-time students, you may need to pay extra for Extended Family Cover. 

But this may still be cheaper than what your adult child would pay for their own singles policy.

However, the cost comparison between Extended Family Cover and a singles policy varies significantly based on the insurer, the level of coverage, and the specific terms of the cover. 

So while Extended Family Cover can sometimes be cheaper than a separate singles policy for the adult child, this is not always the case. The experts at Compare Club can help you determine whether it’s cost-effective to keep you adult child on your family policy versus a new singles policy. 

Can my child remain on my policy as an adult if they have a disability?

There’s no age limit for adult children with a disability to remain on their parents’ policy. This allows them to access their family’s cover indefinitely. 

What if my child is a full-time student?

The new changes mean that depending on your health insurer, all adult children may be covered up to 31. But, as we’ve already noted, not all insurers are choosing to raise their limits to 31.

If your child is a full-time student, you can still add them to your family policy through Extended Family Cover, if your health insurer offers this type of coverage.

However, different funds may have different age limits for non-students. As ever, it’s worth checking and comparing. And if it gets confusing, just get in touch and let us do the hard work for you.

Do all health insurers allow children to stay on a family policy until they turn 31?

No.

No. The 2020 federal budget allowed insurers to extend the age for coverage but didn’t make it compulsory. Most insurers have opted not to extend the age limit for adult children.

At the time of writing, HCF, BUPA, AHM, Australian Unity, Teacher’s Health and Health.com.au are implementing the changes, all with different age limits and restrictions .

Some insurers are offering Extended Family Cover as an option, whereas others are letting you add your adult child to your current policy free of charge.

Compare Club’s specialists can help find policies with higher age limits, if you’re keen to keep your children covered when they reach adulthood.

What happens when my child turns 31?

This is the age when the government’s Lifetime Health Cover (LHC) loading kicks in.

Anyone over 31 will accrue a 2% surcharge. The maximum this surcharge can rise to is 70 percent by the age of 65. This surcharge or loading applies for up to 10 years of health fund membership.

The LHCL is designed to encourage younger Australians to take our private health cover and ease the burden on the public system. 

By raising the age limit to 31, the government aligned the cut-off age from a family membership with the beginning of the Lifetime Health Cover loading period.

Can people aged 18 and above still get their own health insurance policy?

Yes. Anyone over the age of 18 can choose to come off their family policy and take out their own health insurance.

If that’s you, you might want to read our guide to health insurance for young singles.

Do young adults get any discounts on their health insurance?

Many health insurance providers offer incentives in the form of “age-based discounts” for young adults who choose to take out their own policy. 

This can be as much as 10% discount on yearly premiums for anybody aged between 18 and 25.

Can I cover my adult child’s partner on my health insurance?

The short answer here is no.

You may be fond of your child’s other half, but health funds will only cover adult children when the policyholder is their parent or permanent legal guardian. If your child gets married or is in a de facto relationship, they’ll also need to take out their own policy, even if they’re only 18.

At this stage, it’s worth considering if it’s cheaper to get a couples policy or two separate singles cover policies.

Should I keep my kids on my family policy or ask them to get their own cover?

Choosing whether to keep your adult children on your policy really comes down to what you can afford and whether it makes more sense for your children to take out their own policy

While having your adult kids on your cover could put some financial pressure back on the Bank of Mum and Dad, you'd likely be easing the health cover cost burden on your family overall by contributing to the cost of their dental treatment or other health expenses. In this case, it may make more sense for all of you to sit on one policy.

Essentially, the easiest way to work out whether it’s most cost-effective to have a family policy or a young singles policy is to compare. 

It can be quite time consuming to go back and forth between funds. This is where the team at Compare Club can help. 

We’ll compare policies from a panel of Australia’s leading insurers to find out the right combination of policies for you and your family.

How much will it cost to keep my child on my policy once they turn 18?

This varies from insurer to insurer, especially with many health funds increasing the age of dependants to 31. 

With the new changes, it’s easier than ever to see just how much it’ll cost you to keep your family covered with private health insurance, especially if your health insurer offers Extended Family Cover.

This is something Compare Club’s specialists can help with. We’ll look into what you need cover for and whether it’s more cost effective to take out a family policy or to move to separate policies.

Conclusion

Some health insurers now allow dependent adult children to stay on their parents’ health insurance up to the age of 31.  If your dependent adult children are full-time students and are not married or in a de facto relationship, they may be able to stay on your current policy for no extra cost. 

However, if your dependent adult children are not full-time students, you may need to pay extra for Extended Family Cover. Otherwise, your adult children will need to take out a separate singles policy.

Extended Family Cover can sometimes be cheaper than a separate singles policy for the adult child, but this is not always the case.

Talk to the experts at Compare Club to determine whether it’s cost-effective to keep you adult child on your family policy versus a new singles policy. 

Frequently asked questions

Are there any tax implications for keeping adult children on my policy?

There are no direct tax penalties for keeping adult children on your policy. However, if they’re earning above a certain threshold without their own private hospital cover, they may incur the Medicare Levy Surcharge (MLS). Extended Family Cover could help them avoid this.

Sources

The 2024 Australian Youth Barometer: Understanding young people in Australia today, https://www.monash.edu/education/cypep/research/the-2024-australian-youth-barometer-understanding-young-people-in-australia-today

Private Health Insurance: Increasing the age of dependants – questions and answers, Australian Government Department of Health, https://www.health.gov.au/sites/default/files/documents/2022/03/private-health-insurance-age-of-dependants-measure-questions-and-answers.pdf

What you need to know about Lifetime Health Cover, Australian Government Department of Health, https://www.ombudsman.gov.au/__data/assets/pdf_file/0026/287333/lifetimehealthcover_whatyouneedtoknow.pdf

Private Health Insurance age of dependants measure – questions and answers, Australian Government Department of Health, https://www.health.gov.au/sites/default/files/documents/2021/09/private-health-insurance-age-of-dependants-measure-questions-and-answers_0.pdf

Chris Stanley is the sales & operations manager of health insurance at Compare Club. With extensive experience and expertise, Chris is a trusted leader known for his deep understanding of health insurance markets, policies, and coverage options. As the sales & operations manager of health insurance, Chris leads a team of dedicated professionals committed to helping individuals and families make informed decisions about their health insurance needs.

Meet our health insurance expert, Chris Stanley

Chris's top health insurance tips

• 1

  Australia’s public health system is world-class, but wait times for public hospitals can be long, inconvenient - and leave you living in constant pain while you wait.

• 2

  An appropriate private health insurance policy can speed up your surgery, relieving your pain sooner.

• 3

  Family health cover means your children are covered under the same policy as you.

• 4

  Many health insurance policies come with a 12-month waiting period for pregnancy-related cover, so it’s a good idea to get a family policy organized well before starting your family. This means your child will be covered from birth until at least their early twenties (depending on which health fund you select).