Australia’s federal government has approved an average 4.41% increase in private health insurance premiums, taking effect on 1 April – the highest rise in nearly a decade and above recent inflation levels.

Health Minister Mark Butler said the increase reflected the rising costs of medical services, with hospital and medical expenses up about 5% in the last financial year. “The government understands the pressure health insurance premium changes put on Australians and decisions about private health insurance premiums must put consumers first,” he said in a statement.

The rise follows last year’s 3.73% average increase and is the largest since 2017. Experts note the increase outpaces general inflation – about 3.8% – adding further cost pressures on households already grappling with broader cost-of-living constraints.

Critics argue the rise adds financial strain on consumers and households may reassess their policies to manage budgets. Some insurers will raise premiums above the industry average, with recent pricing lists showing variations across funds.

Industry voices stress the need for transparency and cost management, with calls for an independent review of the private health sector to ensure value for policyholders amid persistent premium growth.

Zurich recently appointed a new Head of Travel Insurance for Australia and New Zealand.