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Rising Premiums Prompt Alarm Over Health Insurance

NEWS RELEASE 1 December 2001

Rising Southern Cross Premiums Prompt Alarm Over Health Insurance

Anxious Southern Cross Healthcare members say they've been forced to abandon the organisation because of rising premiums.

Southern Cross is New Zealand's largest private health insurer, with more than 800 thousand members. Earlier this week, the giant insurer warned policyholders to expect another premium rise early in the New Year.

Less than 10 months ago, older customers faced increases of up to 30% to cover rising medical costs. Now, many people say they can no longer afford the company's expensive cover.

Independent insurance brokers Stone & Associates say their phones have rung hot since the latest premium changes were announced. Stone & Associates has offices in Auckland, Wellington and Hamilton.

The company says new customer inquiries about alternative products have leapt by 60% over the past few days.

Managing Director Todd Jones says most callers are aged between 50 and 65.

"There is no doubt many older Southern Cross members are now feeling the squeeze," he says.

"We're getting calls from people who've been with Southern Cross for decades. But now they're facing big increases, and they're genuinely alarmed at the prospect of having to rely on a public health system in crisis."

Mr Jones says in one case, a couple aged in their 60's have seen their combined premiums rise by $1800 in the past 18 months.

"This couple told us they have only just discovered their premiums will increase by a further $800 in the New Year. Their total premium will be over $4000 per annum. This is simply unaffordable for an average couple approaching retirement."

People who find they can no longer afford their Southern Cross cover are now exploring other options; searching for less well known, but more affordable healthcare plans.

Mr Jones says many other New Zealanders are unaware of the vast range of options now available.

"New Zealand health insurance is dominated by a few major players. But in many cases, the big companies do not necessarily offer the best or the most affordable cover."

"Our advice to consumers is to shop around. Some people will benefit more from specialist products, rather than the expensive comprehensive policies on offer from many of the larger insurers."

*Stone & Associates is one of New Zealand's fastest growing independent insurance brokers, representing a range of insurers in New Zealand and from around the world. The company specialises in keeping customer premiums at a manageable level.

FOR MORE INFORMATION, PLEASE CONTACT

Todd Jones Managing Director Mobile: 021 344 810 Phone: 09 523 2720 Email: stoneassoc@xtra.co.nz Website: www.stone-associates.co.nz

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