The COVID-19 pandemic has made many New Zealanders more aware about the importance of looking after their own health and wellbeing, which includes the value of health insurance, the Financial Services Council (FSC) said.
However, the non-profit organisation also warned that mounting economic and cost pressures could strain the health insurance system in the near future, posing challenges for both providers and customers.
“We know that the presence of COVID, and for many of us the personal experience of it, has led to better prioritising and looking after our health,” FSC chief executive Richard Klipin said. “This has also led to a really positive shift in the number of Kiwis protecting themselves and managing their risk by purchasing and retaining their private health insurance.”
According to the FSC, as of March 31, 1.45 million people in New Zealand were covered by health insurance. A total of $1.51 billion in claims was paid out in the last 12 months, an increase of 7.2% on the previous year.
“Health insurance supports Kiwis to meet their healthcare costs and with many claims relating to elective treatments, also helps to ease demand on the public health system,” Klipin said. “It’s reassuring that so many New Zealanders have access to the benefits of health insurance, and our health insurance members are as committed as ever to ensuring quality access to healthcare for their customers.”
Klipin said that the wider healthcare sector, like many others, is facing major cost pressures caused by the current economic environment, which includes rising inflation, interest rates, wages and supply chain costs.
“Healthcare has also been significantly impacted by sector specific impacts including critical workforce shortages and increased labour, surgical and medicine costs,” he said. “Industry feedback has made it clear that as a result, the cost to deliver healthcare services are also expected to increase. As a result of this challenging combination of increasing demand and cost pressures, health insurers must navigate and manage these economic challenges to ensure continued access to quality healthcare for their members. Each provider has its own individual circumstances and will make its own commercial decisions and communicate any changes to their customers directly. We are confident, though, that despite these challenges, health insurance will remain an affordable and high-quality service for all New Zealanders.”
The FSC urged all health insurance holders to actively assess their existing cover to ensure it meets their and their families’ needs. In case they have questions, customers should contact their provider to clarify them, as well as seek expert advice from an insurance broker or other advisor.