A survey commissioned by the Private Health Insurance Intermediaries Association has found the sector is "instrumental" in around half of all private health insurance purchases in Australia.
The survey was based on responses from the association's members that account for around 90 per cent of all leads generated by private health insurance intermediaries.
Its members include large well-known comparison services, such as iSelect and Comparethemarket.com.au.
The survey found respondents generated almost 2.2 million leads in 2018-19, up from 2.11 million in 2017-18, representing an increase of 4.3 per cent.
A conversion rate of 8.5 per cent was down slightly from 8.8 per cent in 2017-18 - however, completed sales rose from 187,360 to 190,070.
The association said over a quarter of its members' sales are 'new entrants' - in 2018-19, this represented 52,340 new private health insurance customers - with nearly half of these singles.
"Of concern, while older consumers are taking out private health insurance in larger numbers, there was a fall in sales of private health insurance to younger consumers," says the survey report.
“Some 25% of all health insurance sales are made through comparison services directly, however, when combined with the additional 200,000 members who seek a recommendation from us and then go on to buy from a fund, we’re actually instrumental in 50% of all purchases,” said the association’s independent chair Troy Sheahan.
“Our data shows that we help a good proportion of consumers who have never had cover before to enter the market, with comparison services responsible for 28% of new-to-market policies in 2019. This drives a valuable share of the real growth in the market.”
The association said its survey shows intermediaries sell a higher proportion of hospital and combined policies than the industry average. "They also sell a higher average annual premium than the average for the funds in effect increasing the level of coverage enjoyed by Australian consumers," it said.
“We believe it’s our members’ level of service and needs analysis which helps consumers make more informed choices. There’s too much commentary about the declining fortunes of the private health insurance market and this survey shows another side of the coin,” said PHIIA CEO Christopher Zinn.
“Given the importance of growing participation, particularly among younger members, funds need to use competitive and cost-effective channels. This demonstrates why funds continue to choose comparison services to attract new members.”