Tom Petty once sang: "the waiting is the hardest part". While the American musician may have been opining on romance, he could quite easily have been discussing the issue of waiting periods when beginning a health insurance policy.
Global health insurer BUPA explained that there is often confusion around the issue among policyholders.
"According to our customer service team, this is a common call that they get: Someone who is considering switching health insurers and has concerns that they will have to re-serve their waiting periods all over again," the health fund's Online Marketing Manager, Diane Leonard, explained.
So, what is it, and under what conditions does it apply to you?
What is a health insurance waiting period?
To ensure that new policyholders or those upgrading their level of cover aren't playing the system, a waiting period applies when taking out private health insurance.
This means that a policy will not pay a benefit – and a person or family are not covered – for a set amount of time.
Essentially, the period is designed to prevent insurance being taken out for health issues that already exist or are likely to happen immediately after the policy is created – which would result in other policyholders effectively paying for the treatment through their own premiums.
In what instances do I have to serve a waiting period?
If you are taking out a new health insurance policy or are improving the level of cover in your existing one, you will have to abide by a waiting period.
Usually, for new policies, this is around two months for hospital treatment and extras, though it can change depending on your choice of insurer and the type of cover you opt for. Waiting periods can be up to 12 months for pre-existing conditions, maternity benefits and other conditions.
If you are comparing health insurance and you are looking for a provider with a lower waiting time period, this can be something to discuss with your broker.
When am I exempt from serving a waiting period?
If you are maintaining or downgrading your level of cover, there is rarely a reason why you would serve a waiting period.
There is also a common misconception that switching insurance provider can lead to you having to re-serve your time in health insurance limbo, which is not true, thanks to continuity of cover.
This term means that your waiting period (or any part of it) will be recognised by your new insurer. So, for instance, if you have served 10 of your 12-month waiting period for pregnancy-related healthcare, you will still only have two months left to wait before you are covered.
Still confused? Your health insurance broker will be able to talk you through the entire process in more specific details. Call HICA today on 1300 44 22 01 and get some expert, impartial and tailored advice.