A new study found a 22% disparity between perceived financial confidence and actual financial literacy, especially concerning health insurance, in particular exploring why a majority of New Zealanders insure their homes and cars, yet a smaller proportion extend this to their health and wellbeing.
Despite the significant support for accessible and affordable healthcare outlined in the Blueprint for Growth policy, recent research by the Financial Services Council (FSC) in their Money & You series has highlighted a notable “perception gap” in the understanding of financial literacy and confidence, particularly in the context of insurance.
The private health sector, which complements the public system, offers quicker access to healthcare services and fosters innovation. Employer-based health schemes are increasingly sought after for enhancing team productivity and managing health risks in the workplace, resulting from either injury or sickness.
With the growing focus on “ageing well” in New Zealand, the accessibility to health prevention services is gaining prominence. The latest FSC data indicates that the health insurance industry in New Zealand supports approximately 1.45 million individuals, having paid out nearly $1.8 billion in claims last year to aid them in meeting healthcare expenses.
A significant portion of these claims are for elective treatments like orthopaedic and gynaecological services, which help alleviate the pressure on the public healthcare system. Approximately a quarter of these claims are from customers under 45 years of age, covering a wide range of services, from everyday healthcare costs to specialist consultations and surgeries.
Since the onset of the pandemic in 2020, the health insurance sector has seen steady growth, with more New Zealanders opting for health cover – a trend mirrored internationally. However, the latest research reveals that only 37% of New Zealanders currently invest in health insurance.
The top reasons for investing in health insurance, according to recent studies, include peace of mind, stress reduction, financial responsibility, concern over the financial impact of significant health events on families, and recommendations from friends. Notably, mental health and wellbeing emerged as the primary health concern (34%), especially among younger generations, surpassing worries about cancer, heart disease, and musculoskeletal conditions.
Examining generational differences, 2020 data shows a gradual increase in average claim levels from birth, peaking around 60-64 years, indicating the benefits of health insurance across all age groups.
Health insurance plays a crucial role in safeguarding families against unexpected health events and potential income loss. The integration of a balanced health system is pivotal for achieving optimal customer and patient outcomes. The FSC and its members are dedicated to supporting the provision of accessible and affordable healthcare, in collaboration with the ACC and public health system.
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