What drives premiums up?
Private health insurance continues to make a significant contribution to healthcare in New Zealand. In their report for June 2011 quarter, the Health Funds Association (HFANZ) reported that 31% of New Zealanders – 1.367 million people – still have health insurance.

And it still seems to be the case that while the Government is making an ongoing commitment to support the healthcare system, public demand continues to increase. And why shouldn't that be the case? People naturally want access to the latest medical technology and treatment, and if they can't get it publically they will seek private alternatives – especially if they have health insurance.

The flow on effect of greater availability of a wider range of treatments and more advanced medical procedures is a higher number of claims with a higher cost. In turn, increased usage eventually has an effect on premium rates.

Is having health insurance still worth it?
Based on claim statistics, yes – people are using their policies and many of them would not be without them.

While an increase in premiums obviously won't be welcomed with open arms, it is worthwhile reflecting on the value and importance of health insurance, and the disadvantages of not having cover.

We all know that compared to other risk products, health insurance is high-touch and not typically a policy which clients put away in a drawer and forget about – they do use it and some of them use it often. And even if a client has not claimed recently, is it worth their risk of not being covered if they cancel? Could they afford to fund private treatment themselves and will they want to be re-underwritten if they decide to take cover again later?

So is it worth it? 31% of the population remain insured and a good number of these people are either using their policy or see value in being protected should they need to access treatment in the future. That's not to say we don't have to work with them to reinforce this value and so we have developed tools to help you do just this.