Leslie Massey
Australia has a variety of insurance options for its citizens, including health, home, and pet insurance. As of 2025, more than 15 million Australians have some form of private health insurance, with 45% of the population having hospital cover and 54.7% covered by an extras policy. However, rates of health insurance coverage are lower among younger people, with a noticeable drop-off in the 20-24 age bracket. Home insurance premiums in Australia are also typically higher for younger homeowners compared to older age groups. Pet insurance is growing in popularity in Australia, with about 7% of pets insured as of 2022, and approximately 22 major pet insurance providers in the country.
| Characteristics | Values |
|---|---|
| Number of people with some form of private health insurance | 15 million+ as of September 2024 |
| Percentage of the population with hospital cover | 45% |
| Percentage of the population with extras cover | 54.7% |
| Amount paid out in health insurance hospital benefits in three months to September 2024 | $4.82 billion |
| Amount paid out in health insurance extras benefits in three months to September 2024 | $1.47 billion |
| Common reason for taking out private health insurance | Avoid Medicare Levy Surcharge |
| Common reason for not taking out private health insurance | Cost |
| State with the highest percentage of people with private health insurance | Western Australia |
| State with the lowest percentage of people with private health insurance | Northern Territory |
| Percentage of the population with private health insurance in Western Australia | 69.2% |
| Percentage of the population with private health insurance in Australia | 55% as of April 2024 |
| Number of people with private health insurance in Australia | 14.42 million as of April 2024 |
| Percentage growth in PHI membership in 2022 | 2% |
| Number of additional people with private health insurance in 2022 | 305,687 |
| Percentage increase in health insurance premiums in 2025 | 3.73% |
| Number of complaints received by the Commonwealth Ombudsman relating to private health insurance in 2022/23 | 3,429 |
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What You'll Learn
15 million+ have private health insurance
While the overall number of people covered by health insurance in Australia has been steadily rising, the portion of the population that has insurance has remained relatively steady over the past decade, as Australia's population growth has also increased. As of 2025, more than 15 million Australians have some form of private health insurance, with 45% of the population having Hospital cover and 54.7% covered by an Extras policy. This means that around $4.82 billion was paid out in health insurance hospital benefits in the three months leading up to September 2024, and around $1.47 billion was paid out in Extras benefits during the same period. The top reason for Australians to have private health insurance is to avoid the Medicare Levy Surcharge, an extra tax charged to those without eligible private health insurance.
However, the cost of private health insurance is also the most common reason for people not having it. Rising premiums, outpacing wage growth, make the cost-benefit analysis less favourable. Additionally, despite having private health insurance, many still face significant out-of-pocket costs, such as co-payments and excess fees. The limited choice and standardised nature of policies, particularly given the cost of living squeeze, is further dampening consumer enthusiasm.
There are also significant state/territory variations in the level of take-up of private health insurance. This is likely due, in part, to the reduced availability of private health facilities in certain parts of the country and the higher out-of-pocket costs that private health members face in some areas. For example, Western Australians are the most likely to have private health insurance, while people in the Northern Territory are the least likely to be covered.
Furthermore, rates of health insurance coverage are lower among younger people, with a noticeable drop-off in the 20-24 age bracket. This is typically the age at which individuals come off their parents' health insurance policy.
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45% have hospital cover
Australia's health insurance landscape is quite interesting. While the overall number of people covered by health insurance has been steadily rising, the portion of the population that has insurance has remained relatively steady over the past decade or so, as Australia's population has grown. This means that the number of uninsured people in Australia is also increasing.
Hospital policies, designed to take the pressure off the public hospital system, are becoming less popular. The number of people without hospital cover has been rising consistently since around 2000. Graeme Hughes, a consumer expert at Griffith Business School, attributes this to a combination of factors. He notes that "rising premiums, often outpacing wage growth, make the cost-benefit analysis less favourable". Additionally, despite having private health insurance, many people still face significant out-of-pocket costs, such as co-payments and excess fees. The limited choice and standardised nature of policies, especially with the current cost of living concerns, further dampen consumer enthusiasm.
It is worth noting that rates of health insurance coverage are lower among younger people, with a noticeable drop-off in the 20-24 age bracket. This is likely due to individuals typically coming off their parents' health insurance policy around this age. There are also significant state and territory variations in the level of take-up of private health insurance. This is influenced by the reduced availability of private health facilities in certain areas and the higher out-of-pocket costs that private health members face in some regions.
Despite these challenges, more than 15 million Australians have some form of private health insurance, with 45% of the population having hospital cover. The most common reason for taking out private health insurance is to avoid the Medicare Levy Surcharge, an extra tax charged to those without eligible private health insurance. Western Australians are the most likely to have private health insurance, while people in the Northern Territory are the least likely to be covered.
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54.7% have extras cover
While the overall number of people covered by health insurance in Australia has been steadily increasing, the portion of the population that has insurance has remained relatively stable over the past decade, as Australia's population has grown in that time. As of 2025, more than 15 million Australians have some form of private health insurance. Of these, 45% have Hospital Cover, while 54.7% have Extras Cover. Extras Cover is more popular than Hospital Cover, with around $1.47 billion paid out in Extras benefits in the three months leading up to September 2024, compared to $4.82 billion paid out in Hospital benefits in the same period.
The most common reason for Australians to take out private health insurance is to avoid the Medicare Levy Surcharge, an extra tax charged to those without an eligible private health insurance policy. However, the most common reason for not taking out private health insurance is the cost. Private health insurance premiums are rising, often outpacing wage growth, making the cost-benefit analysis less favourable. In addition, despite having private health insurance, many Australians still face significant out-of-pocket costs, such as co-payments and excess fees.
The level of take-up of private health insurance varies significantly across states and territories, with Western Australians being the most likely to have private health insurance, and those in the Northern Territory being the least likely to be covered. This is likely due to the reduced availability of private health facilities in certain parts of the country and the higher out-of-pocket costs that private health members face in some areas.
While health insurance statistics indicate a relatively high level of coverage, home insurance statistics in Australia tell a different story. A report by the Melbourne Institute and the Australia Institute revealed that more than 340,000 Australian homes are entirely uninsured, while another 530,000 are underinsured, meaning their policies would not cover the costs of a disaster. These numbers include 300,000 homes that are still under mortgage. As a result, over 2 million people are at risk of financial ruin in the event of floods, fires, or storms, putting banks and the broader economy in a precarious position.
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7% have pet insurance
Australia has one of the highest pet ownership rates in the world, with approximately 61% of households owning a pet, or about 29 million pets. However, only about 7% of pets in Australia have pet insurance. This means that while pet insurance is growing in popularity, it is still considered a niche market.
The cost of pet insurance in Australia ranges between $20 and $60 a month. The average annual cost of pet insurance for a 5-year-old dog is around $1,000, while cat owners can expect to pay around half of that amount. Considering the high cost of veterinary care, pet insurance can help owners save thousands of dollars and avoid tough decisions due to expensive vet bills. For example, the most expensive treatment for dogs in Australia is for Brachycephalic Airway Obstruction Syndrome (BAOS), which costs an average of $16,926.
The largest group of people with pet insurance are those who are employed, making up 77.4% of pet insurance holders. Of all the people who have pet insurance, 59.8% are women. There are approximately 22 major pet insurance providers in Australia, with companies like Medibank, Woolworths, and Coles offering budget-friendly plans, comprehensive coverage, and 100% reimbursement rates, respectively.
While the number of pets in Australia has increased over the years, and pet owners have begun to see their pets as cherished family members, the percentage of insured pets remains low. However, experts anticipate that pet insurance will become more common, with trends following the UK, where about 30% of pet owners are insured.
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Younger people less likely to be insured
While more than 15 million Australians have some form of private health insurance, rates of health insurance coverage are lower among younger people, with a noticeable drop-off occurring in the 20-24 age bracket. This is likely due to the fact that individuals typically come off their parents' health insurance policy around this age. The proportion of insurance customers aged 20 to 29 fell from 10.3% to 9.4% between 2012 and 2017.
Young people are increasingly opting out of private hospital insurance due to rising costs. With medium singles hospital insurance costing $1,711 on average, young people often pay more in premiums than they claim. Additionally, the standardised nature of policies and the limited choice available may also contribute to lower rates of health insurance among younger people.
The Australian government has attempted to incentivise young people to buy hospital insurance through the Lifetime Health Cover loading. This policy penalises those who do not purchase hospital insurance by their 31st birthday, charging an extra 2% for insurance for every year they are over 30 when they sign up, up to a maximum of 70%. However, this policy may not be effective as most people who opt out of insurance are unlikely to save the money they would have spent on premiums.
A survey by Swiss Re found that 7 out of 10 respondents were either covered by life insurance or planning to secure coverage, with 25% already insured and 45% intending to get insured. Interestingly, immigrants were 10% more likely to have life insurance than respondents born in Australia. The study also found that social media plays a pivotal role in the financial decision-making of younger Australians, with 96% of participants using these platforms for personal connections and staying updated with news. This suggests that insurers should utilise social media to engage with this demographic.
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Frequently asked questions
As of September 2024, more than 15 million Australians have some form of private health insurance. 45% of the population have Hospital cover, while 54.7% are covered by an Extras policy.
It's hard to say exactly how many Australians have home insurance, but a report by the Melbourne Institute and the Australia Institute found that more than 340,000 homes are entirely uninsured, while another 530,000 are underinsured.
Pet insurance is still a niche market in Australia, with only around 7% of pets insured. However, it is growing in popularity, and experts anticipate that Australia will follow the UK, where about 30% of pets are insured.
