I suspended my Australian private health insurance for now 2 years and have been told that if I want to keep it I need to now pay 2 months of insurance each year.

I want to know if anyone can tell me if it would be better to drop the insurance which would mean not paying about $AUD120 per year and just reapply when I do end up back in OZ or pay the 2 months to avoid the penalties of not having continuous life time cover?

Does anyone know in laymans what the new federal laws on lifetime cover actually mean. I think it means if you don't have private cover including hospital, 2% is added on to your premiums each year you are over 30.

But not sure if this means 2 % every year from the age of 30 until the day you die, or 6% if you are 33 years old[2% x 3]

Hope someone out there can make this clear for me.

Yeah sadly I worked for the Dept Health when they brought in the Lifetime Healthcover system.

My advice is that if you are over 30, ít's probably worth paying the extortionate monkeys their premium to stay on the books.

The way the system works is this: if you let your cover lapse, then go back to Aus and rejoin when you are 35years, you'll pay an extra 10% premium, on top of whatever the base rate is, for the duration of your cover. So that is: if you maintain the cover you'll pay 10% more than the base rate for the rest of your life (the extra percentage does not increase though). And that is irrespective of the insurer.

So. I reckon, given the insano rate at which premiums are rising, it's worth forking out the extra cash now, to ensure you wont be penalised indefinitely in the future.

Goodluck (great policy Howard Govt - like the Medicare Levy Surcharge wasnt doing its job already)!

Hey thanks for your [inside!] info! I also contacted someone from Dept of Health and waiting for their response. It's a difficult one because I don't know when I'll be back and $120 every year until then is not exactly fun either.