The Southern Cross Health Society is New Zealand’s largest health insurer. On 30 June 2021, the Society membership totalled 887,782, an increase of 8,584 from the previous year. The Society Group posted a surplus of NZ$53 million at the end of the financial year, which included an operating surplus of $10 million, and $39 million primarily derived from investment income.
Society Chairman Greg Gent said it was very pleasing to see the membership growth and strong surplus, despite another challenging year due to the pandemic. “We are all still operating in a climate of uncertainty and so we’re very pleased to have delivered such a strong result. It is precisely the overall outcome we aim for to ensure we maintain our financial strength, particularly important in these unpredictable times.”
Not likely to be repeated next year
Gent explained that the strong investment income is the culmination of the last five years of the Society’s investment activity and a well-optimised strategy but is not likely to be repeated. “While this year’s investment income contributes funds to the Group investment portfolio, which will give members confidence that the business has the means to pay future claims as it grows, such is the nature of investments that we do not expect our portfolio to repeat this performance every year.”
In the last financial year, the Society returned $1.099 billion in claims and received $1.256 billion in premiums. For each dollar received in premiums, it returned 87 cents in claims to members, compared with an average of 62 cents in the dollar among other New Zealand health insurers.
The business paid 73 per cent of all private health insurance claims, significantly more than its 62 per cent market share.
Society Chief Executive Nick Astwick said it was encouraging to see the strong growth over the past financial year, despite the effects of the pandemic, and put this down to a widespread focus by people toward managing their health and wellbeing.