Advisers fear customer backlash as premiums soar

With AIA, UniMed, Southern Cross and Partners Life all hiking health insurance premiums by double digits, there is increasing concern that the scale of increases will drive customers away from cover.

Advisers are worried about customer backlash and policy lapses as health insurance premiums surge by up to 21% across all major insurers.

The concerns follow Partners Life's announcement of a 20% annual increase for existing customers, matching similar steep rises from competitors. AIA hiked premiums by 17%, UniMed by 16%, and Southern Cross by 21%. Russell Hutchinson, director at Chatswood Consulting, says the scale of the increases has risen significantly this year.

"It is really difficult. If you've got a rate for age increase and add in the base rate change, then you have some really substantial increases," Hutchinson says. "We normally get increases of around 8% a year, and coming out of a period where we've had quite high inflation, there's pressure on customers' wallets."