Lifetime Health Cover (LHC) is a government initiative that encourages you to purchase and maintain private patient hospital cover earlier in life.

If you have not taken out and maintained private patient hospital cover from the year you turn 31 and then you decide to take it out later in life, you will pay a 2% LHC loading on top of your premium for every year you are aged over 30.

For example, if you take out private patient hospital cover when you are 40 years old, you could pay an extra 20% on the cost of this cover per year for 10 years. If you wait until you are 50 years old, you could pay 40% more per year for 10 years.

The maximum LHC loading that can be applied is 70%. Once you have paid LHC loading for 10 years of continuous cover, you will no longer have to pay this loading.

If you cancel your private patient hospital cover after paying for the LHC loading for 10 continuous years, you may become liable to pay the LHC loading again if you take out another private patient hospital cover later.

You should also note that the government doesn’t pay the private health insurance rebate on the LHC loading component of a policy.