Nib (ASX:NHF) postpones premium increase for another 2 months

Health insurer nib (ASX:NHF) will postpone increasing health insurance premiums for its Australian health insurance members for another two months until November 1, to further support those impacted by the Covid-19 pandemic.

Although premiums were approved to increase from April 1, nib decided earlier this year to postpone the increase for five months.

The approved increase, averaging 2.66 per cent, is the insurer’s lowest premium increase in 20 years. Today’s announcement brings the premium postponement to seven months.

“In some cases, treatment will no longer occur but in others it has simply been deferred until a later time. So, while nib’s claims experience throughout the pandemic has been lower than what would otherwise have been the case, inevitably there will be a catchup,” said managing director Mark Fitzgibbon.

Fitzgibbon said how much treatment had been lost versus simply deferred means that estimating any actual savings remains challenging.

“Since the pandemic we have been proactively returning savings back to members in a variety of ways including premium increase deferrals, premium credits, expanded cover for Covid-19 related treatment and additional benefits (including psychology Extras benefits) at no additional cost.” 

The seven-month postponement will result in about $40 million in savings returned to members and will be recognised in nib’s operating earnings for the 12 months to June 30.

Shares in nib (ASX:NHF) last traded at $7.36.