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HBF returning surplus funds from COVID-19 to members

Australia’s fifth largest health insurer, HBF, is following through with its commitment that it would not financially benefit from the COVID-19 pandemic, with surplus funds to be returned to members.

HBF
2 min

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In its accounts for the financial year ended 30 June 2020, HBF estimated a deferred claims provision totalling $94.3 million relating to elective surgery procedures and ancillary services members could not access while COVID-19 control measures were in place but were expected to be claimed at a later date.

Since July 2020, HBF has experienced an increase in claims and utilised the deferred claims provision accordingly. With claims normalising, it is expected an unutilised amount of approximately $40 million will be available to pay to eligible current and former HBF members holding a Hospital and/or Extras policy during 23 March 2020 – 30 June 2020. Initial estimates are that almost half a million policies will be eligible, which would result in a payment per policy of between $31 (Extras only) and $140 per policy (Hospital and Extras), subject to regulatory approval.

HBF will provide an update after the final amount is determined by HBF’s Appointed Actuary as at 31 March 2021.

This payment is in addition to HBF being the first and only major private health insurer to cancel its premium increase for all of its members for a full 12-months from 1 April 2020 to 31 March 2021, saving members $37 million.

HBF Chief Executive Officer John Van Der Wielen said: “HBF is honouring its promise made to members last year that they would be the beneficiaries of any surplus funds arising from the COVID-19 pandemic.

“When elective surgery and ancillary services became available again, particularly in WA where the majority of our members reside, we saw an increase in claims but not the surge we had anticipated. With claim levels now normalising, it is clear a meaningful portion of the deferred claims provision will not be utilised and we are committed to returning those funds to members.

“We are working through the details but our principle is for a fair and simple approach to this distribution, with funds paid directly to eligible HBF Hospital and Extras policyholders.

“This decision aligns with our values as a not-for-profit health insurer committed to putting members first and doing the right thing, and is on top of our 12-month premium cancellation and hardship measures implemented in response to COVID-19.”

Contact: Adrian Watson, HBF Corporate Affairs, CorporateAffairs@hbf.com.au / 0419 040 807

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