Helsana posts a good result for 2016
The Helsana Group reports a profit of CHF 98 million for the 2016 financial year. The Group's financial position remains solid. As planned, the underwriting result improved substantially again.
Helsana can look back on a solid 2016 financial year. Earnings were strongly positive at CHF 98 million. This good result for the insurance business was boosted by an excellent investment result, which outperformed the benchmark.
Following the intentional underwriting loss posted for the basic insurance business in order to return the previous year's excess reserves to the customers, the combined ratio is much improved and in the black again. The supplementary insurance business did equally well in spite of rising benefit costs and a slight premium adjustment for two hospital products in 2016.
The Helsana Group's benefit costs increased further in 2016 to CHF 6.101 billion at the end of 2016. At CHF 6.370 billion, premium income also exceeded the six billion mark for the first time. Cost growth for the previous year was in line with the long-term trend of just more than four percent. Costs increased in all categories.
As in the previous year, the KVG business saw a significant rise in medical costs, the costs for physiotherapy and home care, and medication costs. Outpatient hospital costs also rose substantially and at a faster rate than in 2015. The costs for medical treatment by specialists rose more than for general practitioners. What is notable is that medication costs rose by around six percent for the third year running. The hospital sector remains a considerable cost driver in the supplementary insurance business.
billion CHF
in benefits
“As a committed health insurer, we are doing our utmost to ensure free and sustainable health care for all.”
Prof. Dr. Thomas D. Szucs, Chairman of the Board of Directors
billion CHF
in premium income
million CHF
in profit
The result of CHF 55 million is much better than the considerable underwriting loss for 2015. At 99.1 percent (2015: 102.3 percent), the combined ratio is almost balanced.
The 2016 combined ratio for the KVG business of 100.4 percent is considerably better than the 103.7 percent reported for the previous year. The combined ratio falls within the targeted range and has improved substantially on 2015 as planned. Premium volume was raised enough to compensate for the expected cost increases. It was intentionally raised less in previous years in order to reduce the excess reserves. At 95.8 percent (2015: 98.9 percent), the combined ratio for the VVG business is also better than in the previous year. Although benefit costs continued to rise in 2016, marginal premium and discount adjustments for supplementary hospital insurance helped to cushion the cost increases.
The result for the accident insurance business was slightly worse compared to the previous year with a combined ratio of 98.6 percent (2015: 97.2 percent).
“In 2016, we implemented important measures that will allow us to focus even more consistently on the needs of our customers.”
Daniel Schmutz, CEO
combined ratio
Helsana's investments did well in 2016 in spite of the uncertain climate on the financial markets. In 2016, the performance of our investment specialists beat the benchmark by 0.67 percentage points. Overall performance was 3.25 percent on investments of CHF 6 billion. At CHF 55 million, the investment result made a substantial contribution to the overall result. In general, the broadly diversified investment portfolio consistently supported a pleasing performance and helped to strengthen Helsana's financial capacity in the past few years.
All companies in the Helsana Group continue to meet the legal requirements concerning solvency. As at the end of 2016, the Helsana Group had CHF 2.055 billion in equity capital. which highlights Helsana's continued solid market position and confirms that it is well prepared for the future. On 1 January 2017, the Helsana Group merged the Avanex and Helsana brands as well as the Sansan and Progrès brands, ensuring more stability when it comes to future premium trends, reacting to new statutory conditions and improving the risk compensation.
billion CHF
Equity
We want to be one of the industry top three in terms of customer perception by 2018.
In 2016, the focus fell on the consolidation of the new corporate structure, which should make a substantial contribution to ensuring that Helsana advances to the industry top 3 in terms of customer perception (according to the Net Promoter Score, NPS) by 2018. In order to offer its customers an even better and more comprehensive service, Helsana replaced its old IT system environment with a modern and agile infrastructure.
Achieving the strategic NPS objective remains a big challenge. In the most recent survey in December 2016 Helsana was again ranked number 8, but managed to slightly narrow its margin to the top 3. Ensuring a sustainably profitable corporate business remains an important task in the current envi- ronment of consistently rising benefits costs.
Helsana will continue to play a leading role in Swiss healthcare and help provide competitive, top-quality and affordable health services for all. Given the current cost trends, sensible reforms, improved health literacy and more personal responsibility are more important than ever.