Health Insurance After Divorce in Australia

Splitting a Joint Private Health Insurance Policy

If you and your former spouse held a couples or family private health insurance policy, that policy needs to be split into two individual policies after separation. The good news is that most Australian health funds handle this routinely, and you won't have to re-serve waiting periods for hospital or extras cover you've already completed.

Contact your health fund and request a policy separation. One of you will typically keep the existing policy (converted to a singles or single-parent policy), while the other takes out a new individual policy. Under the Private Health Insurance Act 2007, your continuity of cover is preserved — meaning any waiting periods you've already served on the joint policy carry across to your new individual policy. You won't be hit with a fresh 12-month waiting period for pre-existing conditions or a 2-month waiting period for general treatment if you've already completed those on the family policy.

The key is to act quickly. If you let the family policy lapse and then try to take out a new policy later, you may lose that continuity protection and face full waiting periods again.

How Premiums Change

Moving from a family or couples policy to a singles policy will change your premium. The direction depends on your circumstances:

• Couples to singles: Your premium will roughly halve, since you're only covering one person instead of two.
• Family to single parent: If you're keeping children on your policy, a single-parent family policy is typically cheaper than the full family rate but more expensive than a singles policy.
• Rebate changes: The private health insurance rebate is income-tested. On a joint policy, the rebate tier was based on your combined family income. As an individual, it's based on your personal income alone. If your individual income is lower than the combined family income was, you may move to a higher rebate tier and pay less. If your income was the primary household income, the tier may stay the same.

Also check whether your Medicare Levy Surcharge position has changed. Single people whose income exceeds the applicable threshold and who don't hold hospital cover may pay an additional surcharge at tax time. If your income has increased since the policy was held jointly, dropping cover could now trigger the surcharge.

Keeping Children Covered

Children can be listed on both parents' health insurance policies simultaneously. This ensures they have access to coverage regardless of which parent they're with. Check each fund's rules for dependant eligibility and any additional premium before adding children to an individual policy.

Coordinate with your former spouse to ensure at least one parent maintains hospital cover for the children. If you both drop to extras-only policies, the children lose hospital coverage entirely, and taking out hospital cover later means serving waiting periods that could leave them uninsured during a critical window.

The Practical Steps

1. Call your health fund and request a policy separation. Have your membership number and your former spouse's details ready.
2. Decide who keeps the existing policy — the other person sets up a new individual policy, with continuity of cover preserved.
3. Add children to one or both parents' new policies.
4. Update your Medicare card separately through Services Australia (Form MS011) — Medicare and private health insurance are independent systems.
5. Check your rebate tier and adjust your premium payments if your income situation has changed.

The Queensland After-Divorce Checklist includes the health insurance separation step in its sequenced administrative workflow, alongside Medicare card separation, ATO updates, and every other post-divorce notification you need to make.

See more Queensland guides →