Southern Cross Health Society Group posts surplus after returning $50m to members
Southern Cross Health Society Group has today released its annual financial results, posting a surplus of $32.4 million for the year ended 30 June 2020.
The announcement follows Southern Cross Health Society’s pledge during the Level Four lockdown in April to return $50 million to its members.
Southern Cross Health Society is a not-for-profit Friendly Society and New Zealand’s largest health insurer, caring for 879,198 members – 8,133 more than the previous year.
In the last financial year, the Society returned $972 million in claims and received $1.138 billion in premiums.
For each dollar received in premiums, it returned 85 cents in claims to members, compared with an average of 62 cents in the dollar among other New Zealand health insurers.
The business paid out 72 per cent of all private health insurance claims, significantly more than its 62 per cent market share.*
Chairman Greg Gent said it been a very challenging year and the Society was fortunate to be in a position to meet that challenge.
“This result is testament to the Society’s strong foundations and navigation of the highly unusual set of circumstances associated with the pandemic.
“We are always mindful of the need to be conservative with members’ money and this period is no different.”
Chief Executive Nick Astwick said the Society’s focus during the last financial year was on taking care of its members.
“We were with our members from the start of the pandemic, returning $50 million to them, and introducing a significant range of options for those in need of hardship relief.
“At the same time, our workforce was very quickly set up to work remotely, ensuring service levels were seamlessly maintained. These efforts were reflected in very high levels of member and employee satisfaction and engagement.”**
Astwick said cost-saving digitisation of the business had continued at pace, with 82 per cent of customer channels now fully digitised, and more than 96 per cent of claims submitted digitally.
“In the year ahead, our focus will be on further investment in operational excellence as well as introducing new products and services to enable New Zealanders to live their healthiest lives.
“Southern Cross has been here for nearly 60 years and our members can be confident we will deliver for them.”
Southern Cross Health Society retained its Standard and Poor’s A+ financial strength rating for the 18th consecutive year.
Snapshot figures – FY20
- Southern Cross Health Society Group surplus of $32.4 million
- For every dollar received in premiums, Southern Cross Health Society returned 85 cents in claims
- 879,198 members – up 8,133 from last year
- $1.138 billion premium income (up 5% on the previous year)
- $972 million total claims
- 62% of the health insurance market but pay 72% of claims*
- Investments generated $14.5 million of income, with total investments at $534.7 million by the end of the year
- Standard and Poor’s A+ financial strength rating
In the year ended 30 June 2020, the Society paid 3 million claims, including:
- 254,659 surgical procedures, up 1.3%
- 481,390 specialist consultations, down 3.6%
- 628,728 prescriptions, down 4.6%
- 701,400 GP visits, down 3.7%
- *Based on Health Funds Association of New Zealand data
- **59.5% Net Promoter Score, 30 June 2020; Employee Engagement Survey, December 2019-May 2020
Other than the Group surplus, all indicators above relate to the Health Society only
For further information:
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