Three easy ways to save on health insurance

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Before you ditch your health insurance, try these tips to reduce your premiums

Australians are bracing for a blow to the family budget with health insurance premiums expected to rise by an average 4.84%, or $185 a year, on April 1.

Health insurance premiums have more than doubled since 2010 due to rising medical costs.

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Funds also appear to have reduced their benefits for basic-cover policies.

Australian Prudential Regulation Authority (APRA) statistics reveal that 38.5% of insurance policies contain exclusions, up from 36.4% a year ago and 26.7% three years ago.

More than six million Australians are expected to review their health insurance before April 1, according to research from finder.com.au.

A finder.com.au survey of 2031 Australians found more than one in three (36%) would switch providers for a better deal, while almost one in four (22%) would abandon their cover altogether if their health fund raised their premiums by over 5% this year.

But before you switch or ditch your health cover, here are three steps you can take to reduce the impact of the price hike.

Pre-pay and save

If you pay your annual premium upfront before April 1 you can beat the increase. Many funds provide extra incentives for members to pay their premium a year in advance.

The Private Health Ombudsman says these incentives can include a discount on the premium or a deferral of the increase.

And according to iSelect, you might also be able to wrangle a discount if you opt for a direct debit payment.

This will also help you to pay on time and avoid any late penalties.

Choose a higher excess

Most funds allow you to increase your excess for a reduced premium.

This, of course, means that you will have to pay more if you need to go to hospital.

While you might think you can save by dropping extras and increasing your restrictions, the Private Health Ombudsman says opting for a higher excess is a more sensible way to reduce the premium.

Find out if you're entitled to a corporate or restricted fund

Often their members enjoy exclusive discounts and perks, such as lower premiums for higher levels of cover or free gym membership.

Talk to your employer and find out your options. You may also be entitled to join a fund that someone in your immediate family has access to.

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Sharyn McCowen is Money's digital editor. She has a degree in journalism from Charles Sturt University, and was a newspaper reporter for 10 years before moving to magazines and finance.