Health insurers have handed back to their members around $2.1 billion of profits gained from a reduction in claims since the beginning of the COVID-19 pandemic, according to the Australian Competition & Consumer Commission's (ACCC) latest report on the private health insurance industry.
Figures submitted by insurers to the Department of Health and Aged Care show the Australian private health insurance industry's estimated savings since the start of the pandemic to be around $2.25 billion as of June 30, 2022. Some insurers also confirmed that they will take additional measures to return the remaining savings to their members this financial year.
ACCC Deputy Chair Delia Rickard welcomed the insurers' move to give back their COVID-19 savings to eligible members.
“We expect them to continue doing so until all financial benefits from claims permanently missed due to COVID-19 restrictions are returned,” Rickard said. “Insurers must ensure that any funds allocated for measures such as hardship support or coverage extensions are used by policyholders. If not, those funds should be returned through direct approaches such as payments or premium relief.”
ACCC's report showed that the private health insurance industry returned most funds through premium relief (around $1.08 billion), especially deferral of premium increases, followed by direct payments to policyholders (around $847 million). Additionally, the insurers allocated a smaller amount to other measures, such as hardship support and coverage extensions (around $160 million).
Among the insurance providers in Australia, the Health Insurance Fund of Australia (HIF) was the most recent to give back its COVID-19 savings to eligible members, following the footsteps of other Members Health Fund Alliance (Members Health) insurers.
