Daily life is busy. Most people are juggling jobs, family, and financial commitments. For many, particularly younger people, health insurance simply doesn't come into the equation. But it should. By taking out health insurance before the age of 35, you can avoid the Lifetime Community Rating loading and save on your premium in the long term.

With the Lifetime Community Rating system your health insurance premium is directly related to the age you are when you first buy health insurance. If you reach 35 without taking out private health insurance your premium will be loaded with an additional 2% charge for every year over the age of 34.

Let's break it down: if you are 40 by the time you take out health insurance for the first time, your premium will be 12% higher than another 40 year old who bought health insurance when they were 30.

Why was the Lifetime Community Rating introduced?

The charge was introduced in 2015 to encourage younger people to take out private health insurance. You see, the health insurance market benefits from a steady influx of young people entering the market and paying premiums. Younger people typically claim less on their health insurance, and effectively balance out the increased number of claims from older people. If there are enough younger people in the health insurance market it can keep everyone's premiums down.

We know when you hit your early thirties there are a lot of things to consider. Financially, things can be challenging. Health insurance may not be first on your priority list, and we understand that; you're fit, you're healthy, you may think you don't need health insurance yet. But the smart plan would be to get in early with health insurance. Buying a plan in your 20s and early 30s will save you money in the long run. At a basic level, you will be able to avoid the Lifetime Community Rating loading, which can really add up after the age of 34. By the time you're 40 you would pay an extra 12% on what can already be a substantial expense.

When is it time to consider health insurance?

When you take out health insurance is up to you, but why not think about it at a time when you will not incur the additional cost of the Lifetime Community Rating loading. If you're unsure where to start our rundown of what you can expect to pay for health insurance is a good explainer. It outlines the different levels of health insurance and gives you a clear picture of what you can expect at each level. If you're still not sure where to start our expert team would be happy to chat with you about what level of cover would suit you best, and how to get the best value for your money.