Sharechat Logo

Nib NZ first-half earnings slide 30% as claims outpace policy growth

Monday 18th February 2019

Text too small?

Nib New Zealand posted a 30 percent slide in first-half profit as the local arm of the Australian health insurer's claims bill rose at a faster pace than it could win new policyholders. 

Underlying earnings fell to $10 million in the six months through December, as it paid out $69 million in claims, up 9 percent from a year earlier. Premium revenue rose 6.2 percent to $113 million, with a 1.7 percent gain in policyholders to 104,399. In Australian dollar terms, underlying earnings fell to A$9.5 million from A$13.1 million a year earlier. 

The increased payouts were driven by a 22 percent increase in hospital claims and a 26 percent rise in claims for ancillary providers, such as physiotherapists and dentists, nib said. 

The New Zealand insurer's management costs rose to A$33.2 million from A$31 million, which it said was largely due to launching its Whitecoat comparison website in New Zealand and investing in its First Choice Directory network. 

Nib NZ wasn't alone in facing increased claims costs. The latest quarterly figures from industry group Health Funds Association New Zealand show claims paid in the year through September rose 7.6 percent to $1.26 billion, compared to a 7.4 percent increase in premium income to $1.52 billion. Individuals covered were up 1.9 percent at 1.4 million. 

Government data show consumer prices for health insurance rose 3 percent in the six months through December, outpacing a 2.6 percent increase in hospital services prices, a 1.1 percent increase in dental prices, and a 1 percent rise in medical services prices. 

The ASX-listed parent - nib Holdings - reported a 4.8 percent increase in net profit to A$74.3 million, with revenue up 11 percent at A$1.2 billion. Underlying earnings climbed 19 percent to A$114.3 million and nib expects annual earnings to be at least A$195 million. 

The board declared an interim dividend of 10 Australian cents per share, up from 9 cents a year earlier. 

The shares slipped 0.2 percent to A$5.81 in early trading, and are down 8.6 percent from a year earlier. 

(BusinessDesk)



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

U.S. Dollar Nears a Critical Level That May Trigger a Buying Spree
21st February 2020 Morning Report
Tech Leads Stocks Lower on Virus Fears; Gold Gains
NZ dollar falls on disappointment over Chinese stimulus
Qantas Axes Flights Across Asia as Virus Scares Off Flyers
Some of China's Top Suppliers Are Readying for a Virus Rebound
Plexure signs contract with Super Indo
20th February 2020 Morning Report
Stocks Reach Record Highs After China’s Moves, Fed
Gold breaks through $1,600

IRG See IRG research reports