When I was a child, our family had a private health insurance policy with HBA. We kept it til the mid 1980s when Medicare came in, and then my parents made a decision to drop it.
Throughout my twenties and early thirties, I took my health for granted and did not bother with private health insurance. Then, after I started getting slugged with the excess medicare surcharge after I suddenly got a very big spike in my annual earnings (lots of work related travel and overtime over a couple of years), I decided to return to HBA.
I did not shop around or compare the merits or reputations of health insurance companies. I just went for my internal default option and chose the company which was most familiar, insofar as I had known that my family had used them over two decades earlier.
Soon after, HBA got taken over by BUPA, a foreign company, and inertia caused me to continue with them.
There’s a lot wrong there, of course. For example, if I had gone with NIB, I would have picked up some shares when NIB demutualised. Aside from which, BUPA is a sponsor of the Carlton Football Club, which does nothing for me. Along the way, BUPA’s partnership with AGL (another of my defaults – the utility company) ended, so less value there.
Still, I did not change policies – aside from once doing a half hearted price comparison with Australian Unity sometime a few years before COVID.
So, what caused me to dump BUPA for HCF last week after 21 years of loyally paying up my membership premiums each year?
I did not plan to do it. My habit is to pay my membership premiums annually, before 1 April, so as to avoid the coming year’s price increases. As I do not like owing money, I prefer to pay my bills in advance (a silly move, I know!), particularly if I have the money earmarked for it sitting in my bank account.
So I went into the BUPA store, and was told that their system would not allow me to pay 12 months in advance so far in front of where my current policy was paid up. This is a bit silly – they should have shut up and taken my money!
I did ask what the premium for 12 months was. I was told, without any contrition, that my current policy would cost just over $2700 – as compared to just under $2200 last March.
I ran the numbers on my calculator app. That was a 25% hike in price. I was shocked.
Something shifted in me. Much as I usually subscribe to the doctrine of ‘rational ignorance’ – ie that shopping around is not worth the hassle most of the time, we were talking about $500.
A one off 25% price rise is more than enough to sever the ties of nominal baseless unrecipricated loyalty and make me think twice.
A quick visit over the corridor to Medicare indicated that Medicare would charge me $3100.
I decided to walk a little further to the HCF office. There, I was quoted about $2300 for the same policy.
Health insurance is usually rather Byzantine to the layman. The various inclusions and exclusions, the claiming of the rebate (I have always claimed it even though promotions at work, growth of my share portfolio, and bracket creep have made it doubtful that I am eligible, preferring to sort it all out at tax time), and excess makes it hard to be certain that the Silver Plus cover I was claiming at BUPA was the same as that I was being offered at HCF.
So I decided to double check with BUPA. Rather than going back into the office, I decided to lie on my couch and call them to clarify some details of the policy. The wait time was meant to be 35 minutes. However, there was an option to get called back when I got to the front of the queue. I chose that option. It did not work, and kept me on hold. When I got to the front of the queue, the operator told me that the IVRU had inadvertently dumped me into a different queue from the one I had asked for – so I was transferred.
It ended up talking more than an hour all up to get the questions answered over the phone. I was not impressed.
Having confirmed what I needed to know about the existing policy, and being riled up by the unresponsiveness of the call centre technology and delays, I decided that I was going to drop BUPA after 21 years, provided that the HCF policy was sufficiently similar in coverage.
The next day, I went into the HCF store and asked the same questions about excess, rebate being factored in, and coverage. When it was confirmed that the policy was as similar to what I had with BUPA, but was $400 cheaper, I did not hesitate anymore.
Why now? I am not looking at dumping Telstra as my mobile/internet provider. Nor am I looking at changing banks. Nor do I see any need to dump AGL as my energy retailer. RACV as my house insurance is also safe.
I suppose it is a number of factors. The 25% price hike was something which I could not overlook. The lack of empathy from the sales rep, as compared to the friendly person at HCF is another. And the poor quality of the call centre system (ie the automated part) which made two separate serious mistakes which made my time feel as not valued by BUPA did not impress me.
As well, I have spent a lot of time on calls and emails this past month trying to sort out my electricity meter reconfiguration with my electricity supplier and my less than stellar solar panel installers. My patience with poor customer service is starting to wear thin and I am now much more inclined to reward price rises and poor customer service with what they truly merit.
Lost For Words! 