By JULIET ROWAN and NZPA
Some of Southern Cross Healthcare's 800,000 members will receive rewards for low claims under a new scheme after the company made a significant profit last year.
The group has turned a $41 million loss two years ago into a $43 million surplus this year because of rising
premium incomes and lower claims.
Southern Cross, the country's largest health insurer, said it would introduce a 10 per cent discount on premiums from next May as a low-claim reward for people who make few claims for illness.
Chief executive Dr Ian McPherson said: "Our forecasts are that around 70 per cent of the society's adult members on individual or voluntary group scheme policies will qualify for the reward."
That should translate into savings of around $30 million for members.
"We're envisaging that a low claim reward will recognise hundreds of thousands of members who because of good health are lucky enough not to make these claims."
Southern Cross said a 40-year-old member in its RegularCare plan would be able to claim treatment costs averaging up to $300 a year and still earn the 10 per cent low claim discount.
An older member who paid more in premiums would have a higher threshold.
In July, Southern Cross announced that about half of its members faced base premium increases of between 1 per cent and 15 per cent in the coming year. At that time, Southern Cross blamed the rising number and cost of surgical claims.
The annual report issued at the weekend showed that the cost of claims by members had risen by around 3.5 per cent - a lower rate of growth than for recent years and below what the company had expected.
Dr McPherson said the "low claim" system was an adaptation of insurance companies' "no claim discounts" for cars.
"A no claim discount on vehicle insurance discourages people from claiming for small dings and dents. That approach would be completely at odds with our philosophy of better access to health care."
The company was saying, "Don't hesitate to go to the doctor when you need to".
In December, Southern Cross introduced a "healthy lifestyle reward" with its Wellbeing insurance plan.
The reward discounts premiums for new members based on a questionnaire asking about smoking, drinking, exercise and healthy eating.
By JULIET ROWAN and NZPA
Some of Southern Cross Healthcare's 800,000 members will receive rewards for low claims under a new scheme after the company made a significant profit last year.
The group has turned a $41 million loss two years ago into a $43 million surplus this year because of rising
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