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This is how you block your health insurance premiums - iSelect
Each year, insurance contributions rise and Australians are feeling the effects of the strain. Blocking your premium" is a strategy that allows you to maintain the price of the preceding year for the coming year, thus avoiding the costs of a possible price hike. Every year on or around 1 April, the government of Australia will announce an increasing amount of insurance contributions.
Nevertheless, many privately owned insurance companies allow clients to make payments 12 month in advance at the prior year's exchange rates if they are made before the price increase. It is called "blocking in your premium". If you can buy it, consider redeeming your bonuses and making a full 12 month advance payment.
Can I redeem my bonus? Whilst imprisoning your premiums is a good way to make savings, not all insurance companies will allow you to do so. Consult your insurance company to find out if blocking your premiums is an optional part of your particular insurance plan. As a rule, the increase in contributions to the sickness insurance scheme takes place on 1 April of each year.
One year' bonus (12 months) paid in March (at actual rate). In order to "block" your annuity at the actual rate: You must have your annuity paid by the banks before 1 April or, for some insurance companies, a few working day before. It is important that you do not get out too late before redeeming bonuses.
Your bonus (at the prevailing rate) is now covered until March of the following year. What is the best moment to block my subscription? It is best to redeem your bonuses and make your payments before the beginning of April. However, some insurance companies have a deadline before the notification on April 1, and some financial institutions may need up to six working day to handle your request.
It is a good idea to contact your insurance company at the beginning of March to get a fixed date on which you should make the payments. In this way, you won't miss your opportunity to block bonuses at the exchange rates of the year before.
Remember that you can keep them locked up at any moment before the beginning of April. Which are the advantages of blocking my membership? Savings can be made by taking out insurance policies. In essence, by making the prepayment you are delaying the payment of the elevated premia for up to 12 month if your insurance increases.
Remember to lock in bonuses as an auto 4-6% off per year as this is the median amount the Australian medical insurance premium will rise each year. Suppose Kate spent $1,200 a year on personal medical insurance in 2010. Had their bonuses risen by the industry-weighted mean each year since then, they would pay $1,823 annually in 2018 - more than 30% more in eight years.
However, this example does not take into consideration other factors for which bonuses may rise. It can give you an additional advantage if you also lock up your bonus. By paying in advance, you are done and equipped with your annual insurance coverage. This could spare you both your busy schedule and your stressful work.
But before you decide to block your bonuses, consider whether you can affordable to do so. One year of medical insurance will cost you more in advance. They may be in a situation to make early payments for the year. Please also be aware that blocking your bonus does not mean that mutual fund cannot make changes to certain insurance features and cover, changes to discounts or limit values or to the service provided by the policy/health insurance.
It is also important to make sure that your transaction has been completed by 1 April by the funds of your choice.