nib posts first half loss but expects to rebound in second half
nib New Zealand said unusually high, industry-wide costs and claims inflation and slow economic growth had an impact on the health insurer’s first half profit.
Tuesday, February 25th 2025, 11:33AM
Revenue was up 12.1% in six months ending December 31 to $218.0 million from $194.4 million in corresponding period last year, but the business delivered an underlying operating loss of $10.9 million for six months, against a profit of $13.0 million in the first half last year.
nib New Zealand chief executive, Rob Hennin, said the half-yearly result reflects the challenging economic environment in New Zealand, with conditions affecting all New Zealanders. Economic growth has been subdued.
Costs were driven by claims inflation at 17.6% in nib’s New Zealand health business, service costs rose 7.6% and utilisation was up 9.3% in the six month period, compared to last year
KEY POINTS
- 1H25 revenue up 12.1% at NZ$218.0 million from NZ$194.4 million in 1H24
- Incurred claims up 27.3% at $159.7 million from $125.5 million in 1H24, as more Kiwis use their health insurance
- Industry-wide cost and claims inflation and difficult NZ trading conditions impact 1H25 result
- Underlying operating loss at $10.9 million, down $13.0 million profit in 1H24
- Pricing adjustment expected to drive nib NZ full-year profitability
Policyholder numbers in the health business remained stable.
The factors that affected nib NZ’s result were endemic to the sector. “We are mindful of household budgets, but have increased premiums to reflect the impact of higher claims costs,” Hennin said.
“We are ambitious about delivering value to members.”
nib NZ has continued to invest in its core technology, helping advisers, their customers and nib members with easier and faster claims processing and pre-approvals for treatment. nib also expanded its Toi Ora health initiatives and health management programmes, that help members prevent and manage longer term health problems.
nib NZ will focus on pricing, costs and productivity gains in second half, Hennin said.
Looking ahead chair Hanne Janes said “Around the world, persistent, sustained inflation resulted in high interest rates and considerable cost-of-living pressure on householders.”
“Interest rates have started to ease, and we expect overall conditions in the New Zealand market to improve,” she said. We know value is crucial for
members, now more than ever. In 2H25, we will continue our focus on costs, refocus on innovation and productivity gains, and bring good solutions to health care for members.”
nib NZ is launching nib Ultimate Life and Living insurance, a new product range that includes life cover, trauma cover and income protection cover.
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