Where You Can Actually Save Money
Most people overpay because they don't understand which parts of health insurance are luxury and which are essential. The good news: you can cut premiums significantly without touching the core protections you need.
The three biggest cost drivers are: your excess amount, your major medical tier, and add-on covers (dental, vision, maternity). Adjusting these can cut your premium by 40-50%.
The Excess Lever: How High Should You Go?
Your excess is the most direct way to cut costs. A $250 excess might cost $1,200/year, while a $1,000 excess costs $800/year — a $400 annual saving. But you must have $1,000 in savings to make this work.
Here's the math: if you claim once every 3 years on average, a higher excess actually costs you less over time. If you claim every year, a lower excess is smarter. Look at your claim history.
Surgical-Only vs Major Medical: A Practical Breakdown
Surgical cover costs 60-70% less than major medical. You only pay out-of-pocket for specialist consultations and diagnostic tests. This works if you're young, healthy, and unlikely to see specialists.
But if you have any ongoing condition (hypertension, diabetes, arthritis), major medical saves you thousands in specialist consultation fees. The true cost of surgical-only emerges when you need years of specialist appointments before eventually having surgery.
Which Add-Ons to Cut
Dental and vision coverage are rarely good value. You're paying $20-30/month for cover that reimburses at 50-60% after a fixed benefit amount. It's better to budget $300/year for dental and $200/year for vision out-of-pocket.
Mental health cover is worth keeping if you expect to use it. Several insurers offer it in some form, so check the benefit maximum on your plan rather than assuming you have to change insurer for it. Critical illness cover is worth the extra $15-20/month if you're the sole income earner.
Switching to a Cheaper Insurer
Shopping the market is a real lever, but we cannot tell you what it is worth in your case and neither can anyone else. No New Zealand health insurer publishes a full premium schedule, so the only way to find out is to be quoted on identical cover by each insurer on your own details. What we would add is that the comparison only means something if the plan level, the excess and the people covered are the same in every quote.
Get quotes from Partners Life, AIA, UniMed, and Southern Cross for your exact requirements. The difference will likely surprise you.
The No-Tricks Strategy to Maximum Savings
- Set your excess to $750-1,000 (you must have emergency savings)
- Choose major medical only if you have any chronic condition; surgical-only if perfectly healthy
- Skip optional add-ons except critical illness
- Get quoted on identical cover across several insurers before you renew
- Review annually — insurers adjust premiums, and you may find better value
You'll typically save 30-40% without losing meaningful cover.