ACC registers fewer claims for 2021-2022 | Insurance Business New Zealand
The ACC has reported that registered claims fell 14% to 1.8 million for the 2021-2022 period, having reached a record high 12 months earlier.
According to the ACC’s annual report, the decline was due to lockdown restrictions having an immediate impact on people accessing the scheme for new injuries. The Crown accident insurer also reported a $49 million net accounting deficit, down from a $10 billion surplus in the previous year.
ACC said that rising interest rates and weakness in the equity and bond markets had a significant impact on both the outstanding claims liability (OCL), which fell by $5.1 billion to $50.3 billion, and returns from ACC’s Investment Fund, which fell by a similar amount to $45 billion.
The OCL is the expected future costs of injury claims on ACC’s books, and the increase in interest rates has impacted the discount rate used to value these liabilities, ACC said. Meanwhile, its investment fund recorded its lowest-ever returns at -9.21% as financial markets fell.
“After some 20 years of low and stable inflation, price pressures are resurging globally, and interest rates have risen sharply,” ACC chief investment officer Paul Dyer said. “Despite the lower investment returns, our investment team’s performance was very good, generating some $500 million in added value by beating their market benchmarks by 1.09%.
“The investment fund is a counterbalance and partial hedge to the financial risks inherent in ACC’s operations and, to this extent, the 2022 results reflect the scheme working as it should. This result highlights that the fund is playing the role intended of stabilising the corporation’s overall finances. Our long-term focus means we can look through volatility in the short term.”
Other achievements outlined by ACC were:
- Funded 8,800 rongoā (traditional Māori healing) sessions for clients and offered these services to its employees
- Expanded the treatment and rehabilitation services available via Telehealth
- Invested $78 million into preventing injuries
- Reduced the carbon intensity of its listed equity portfolio by 49% and its corporate carbon emissions by 67% versus the June 30, 2019 baseline
Following a data privacy breach in 2021, ACC commissioned an independent review to investigate employee access and use of client information. The review found that employees understood the obligation to protect personal information, but the organisation had been too narrow in its focus on privacy. ACC accepted all 30 of the report’s recommendations and put in place an enterprise-wide plan to address them.
“ACC is committed to ensuring New Zealanders can have full trust and confidence in how their personal information is managed,” ACC said.