Health and medical insurance provider nib Holdings Ltd (ASX:NHF) is anticipating an operating loss of $10 million in the first half of 2025, as a significant number of claims from New Zealand bite into the company’s group commercial performance.

The insurer posted guidance of between $235 million and $250 million in underlying operating profit (UOP) for the 2025 fiscal year, with CEO and managing director Mark Fitzgibbon noting that while the Australian sector of its business was still booming, ‘claim inflation’ in New Zealand was weighing heavily overall.

“As reported at last week’s annual general meeting, our flagship Australian resident’s health insurance business (arhi) is growing strongly, with net policyholder growth for the first four months of this year up over 52% on the prior corresponding period,” he said.

“Currently our annualised growth rate of 3.2% is likely well ahead of average system growth.

“We expect our net margin for the full financial year will be in the order of 6.0% – 7.0%, aligned with our target range.

“However, extraordinary growth in New Zealand claims experience is weighing heavily on this year’s Group commercial performance, with an expected operating loss in 1H25 of about AUD$10.0 million.”

Mr Fitzgibbon added that he expected the situation to improve in the second half of 2025, and that higher pricing, operating cost savings and claims inflation would moderate, allowing for full-year profitability, although this would be softer compared to FY24.

nib shares fell after the news, and at 11:59 AEDT, they were trading at $5.99 – a fall of 0.08% since the market opened.

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