Fidelity Life’s full year underlying profit rose from $11.6m to $17m according to its latest annual report.
Helping the firm was an $8m uplift in net premium revenue to $158.3m and a fall in operating expenses from $58.5m to $56.8m. Claims paid to customers increased from $125.7m in 2019 to $139.7m in 2020.
Chief Financial Officer and joint acting CEO Simon Pennington says the results were encouraging in such a complex and challenging environment.
“One year into our 2025 Winning Aspiration transformation strategy, things are looking good,” he says.
“The build of our new technology platform is on track. We’re also demonstrating compassion and resilience as we support our customers, advisers and people through Covid-19.”
The company, which has an 11.5 per cent market share, assets valued at $678m and 267 staff, says it will continue to support advisers as they transition to the new conduct and licensing regimes.
Over the coming months it says advisers can expect to see an upgrade to its Apollo, eApp and Adviser Centre.
There will also be a new commission framework that the firm says will “…reward advisers appropriately under the new regulatory environment”.
Pennington says: “The economic outlook is very uncertain due to Covid-19 and we’re mindful that new business, lapses and income protection claims could be impacted as New Zealanders face growing financial pressures. But we’re confident in our ability to face these challenges head on.
“Over the next 12 months or so we’ll start seeing the benefits of our technology investment and move into a new office in Auckland’s CBD.”
The annual report highlights that less than 40 per cent of New Zealanders have a life insurance policy “…which means under-insurance remains the burning issue our industry needs to address”.
In addition, it says evolving consumer and regulatory expectations, legacy technology constraints, rising claims costs and increasing pressure on profitability and solvency are other challenges facing life insurers “…and that’s before we even get to Covid-19”.
Key 2020 annual report facts
- 92 per cent of claims paid
- Cancer accounted for 32 per cent of all claims
- $75.6m paid in life cover on 599 claims
- $139.7m paid to 1,500 customers
- 11.5 per cent market share
- Move to new CBD offices on the cards
Fidelity Life’s 2020 annual report can be downloaded here.