DJ Young, Healthy May See Less Value From Private Health Insurance -- Market Talk
2320 GMT--The value gap for younger and healthier private health insurance customers is being reinforced as the average health of the risk equalization pool deteriorates, says Macquarie. This deterioration in value, it says may accelerate younger customers leaving the system. "Young people claim less but their premium rate growth reflects the increase in market claims because funds can't risk rate," notes Macquarie. It estimates that Medibank could contribute A$11M to the RE pool in FY 2022 due to the ongoing mix shift towards its younger AHM brand. Conversely, Macquarie says, Nib's normalization of policyholder age to industry averages is being outpaced by their ability to attract better risks. "As such, we forecast Nib's contributions to stay at a consistent percentage of total claims," it says.(alice.uribe@wsj.com)
(END) Dow Jones Newswires
March 16, 2021 19:23 ET (23:23 GMT)
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