Data release
Health premiums rose almost 20%. AIA paid out less and declined a bigger share of claims
Source: AIA NZ, AIA NZ pays $790M in total claims in 2025
AIA NZ turned down nine claims in every hundred in 2025, up from eight in 2024, and its total payout fell 4.8% to $790 million. Health claims did grow, by 6.2%, which is about a third of the rise in health insurance prices. At Southern Cross, claims genuinely surged.
By Henry Smith · Insurers · 2026-05-12
What this means for you Health insurance prices rose almost 20% in a year when the country's largest life insurer paid out 4.8% less in claims and turned down a slightly bigger share of them. The claims surge insurers talk about is real, but it sits in some products and not others. AIA's health claims grew 6.2% while its life payout fell 13.5%, so the explanation fits some policyholders far better than others.
If your health premium went up this year, the letter almost certainly blamed claims. So here is what the country's largest life insurer actually paid out. AIA NZ paid $790 million in claims in calendar 2025, down from $829.6 million in 2024, a fall of 4.8% (AIA NZ, 12 May 2026, and AIA NZ, 8 May 2025, both).
It also said no to a bigger share of them. AIA accepted 91% of the claims it received in 2025, down from 92% the year before (Claims Compass #3 and Claims Compass #2). Turn that around and nine claims in every hundred were declined, where a year earlier it was eight. That is a 12.5% rise in the rate of declines, in the same year the money going out shrank.
Across the market, health insurance prices rose almost 20% in the year to September 2025, and some individual increases reached 50% (RNZ, 29 October 2025). AIA's health claims did rise in that year. They grew 6.2%, roughly a third of the price rise.
So what does this mean for you?
One insurer's year is not the whole market, and none of this is advice about your own policy. What it changes is the question worth asking when a renewal letter blames rising claims costs: what did your insurer actually pay out, rather than what the industry says happened. AIA's answer for 2025 sits in those same two reports. Total payout down 4.8%. Health payout up 6.2%. A slightly bigger share of claims turned down.
That last one decides whether you ever appear in the payout figures at all, and it moved the wrong way in a year when the payout was already falling.
What AIA published, and what it left out
On 12 May 2026 AIA published the third edition of its Claims Compass, the yearly report where it adds up what it has paid out. The $790 million went to more than 789,000 New Zealanders, and the theme AIA chose was heart disease: more than $93.5 million in heart-related claims, most common among men aged 40 to 69 (AIA NZ).
On costs, the release points one way. It blames "rising claim volumes and medical inflation across the industry", pointing to a strained public system, better diagnosis and treatment, and medical costs rising faster than prices in general (same release).
What it never mentions is the year before. When the total went up, that comparison was AIA's opening line: $829.6 million paid in 2024, "a $95M increase on the previous year" (AIA NZ's 2025 release). When the total fell, the sentence disappeared. The sum takes one line. $829.6 million minus $790 million is a drop of $39.6 million, or 4.8%.
The number of New Zealanders covered fell too, from over 797,000 in the 2024 edition of the Claims Compass to over 789,000 in the 2025 one.
Which products fell, and which rose?
The release lists the 2025 total for each product but never sets it against 2024, and those earlier figures sit in AIA's own previous report. Trauma there is the lump sum paid on a serious diagnosis, income protection the monthly payment while you cannot work, and TPD the payout if you can never work again. Put the two years side by side and the story changes shape.
Chart: QuoteHub comparison of AIA Claims Compass #2 and AIA Claims Compass #3.
| Product | 2024 claims paid | 2025 claims paid | Change |
|---|---|---|---|
| Life | $298.1m | $257.73m | down $40.37m, 13.5% |
| Health | $167m | $177.31m | up $10.31m, 6.2% |
| Trauma | $139.5m | $142.45m | up $2.95m, 2.1% |
| Income protection | $97.2m | $108.69m | up $11.49m, 11.8% |
| Total permanent disablement | $23.9m | $21.35m | down $2.55m, 10.7% |
| Sum of the five products | $725.7m | $707.53m | down $18.17m, 2.5% |
| Headline total | $829.6m | $790m | down $39.6m, 4.8% |
2024 figures from Claims Compass #2, 2025 figures from Claims Compass #3, both linked above. The change column and both sum rows are QuoteHub arithmetic.
Three things stand out from that table. The release mentions none of them.
First, the whole decline sits in life cover. Life claims fell $40.37 million, which is more than the $39.6 million fall in the headline total. Health cover, where price rises have been steepest, grew 6.2%, and income protection grew fastest at 11.8%. That is the one product where the payout genuinely matches the industry's cost story. Nor is the life fall a settling down after one unusually big year. AIA's 2025 release said life claims rose $34.6 million in 2024, which puts 2023 at $263.5 million. The 2025 payout of $257.73 million is below even that.
Second, the five named products add up to $707.53 million. That leaves $82.47 million of the $790 million headline unexplained, and the table shows the same gap in 2024. Roughly a tenth of the payout went to products the release never names.
Third, health is not the main thing AIA pays for. Health claims were 22.4% of the headline total, while life, trauma and income protection together were 64.4% (AIA NZ). AIA is mostly a life insurer, and the life side is where its payout shrank.
Where the claims really did surge
Southern Cross Health Society is the country's biggest health insurer. Its latest reported year looks nothing like AIA's:
| Southern Cross, year to 30 June 2025 | Figure |
|---|---|
| Claims paid to members | $1.706 billion, up 14% on the prior year |
| Number of claims | 3.8 million, a record, up 16% |
| Members | 951,808 |
| Share of premiums paid back out as claims | 94% |
All figures from Southern Cross, 30 September 2025.
Southern Cross pays out about $9.60 in private health insurance claims for every health dollar AIA pays.
That contrast is the honest shape of the "surging claims" story. At Southern Cross, claims really did surge, and it can point to its own numbers to explain its prices. At AIA, health claims grew nowhere near as fast as health prices across the market, and the total payout fell. The industry version fits in one sentence. The numbers, insurer by insurer, do not.
What it means for your own cover
If you hold health cover, the claims pressure behind price rises is real, but it sits mostly with the insurer carrying most of the load. It does not explain every other insurer's year.
If you hold life cover, the country's largest life insurer paid out 13.5% less on life claims in 2025 than in 2024, and less than it paid in 2023. Most life policies use stepped premiums, the common type where the price rises each year as you get older. Those rises happen whatever claims did.
Whatever you hold, the acceptance rate decides whether you ever appear in the payout figures at all. A one-point slip looks small until you are one of the nine in a hundred. Claims are won or lost on paperwork, on what you told the insurer when you applied, and on following the right steps. A claims readiness check is worth doing before you claim, not during.
What don't these numbers tell you?
AIA does not publish how many claims it received, so nobody outside the company can see the count behind the 91% acceptance rate. We cannot say how many people the one-point slip represents, only that the rate of declines rose.
AIA's material never explains the $82.47 million gap between the five named products and the $790 million headline. Workplace schemes and smaller benefits are likely candidates, but the release does not say, and we did not guess.
The Southern Cross and AIA reporting periods do not line up. AIA reports the 2025 calendar year. Southern Cross reports the year to 30 June 2025. They overlap by six months, so the 9.6 times figure is a rough guide to scale, not an exact comparison.
We took the Stats NZ price figure for health insurance from RNZ's reporting of it, not from Stats NZ directly. The 2023 life figure of $263.5 million is our own subtraction from the $34.6 million increase AIA stated, not a number AIA published.
AIA's release gives no premium income figure, so we cannot work out how much of the money it took in came back out as claims. Nothing here shows what AIA itself did to its own prices in 2025. The near 20% rise covers the whole health insurance market, not AIA alone.
What this means for your cover
Financial strength, published benefit limits and who underwrites which brand, side by side. Compare New Zealand insurers
Sources
Every source below was read and checked on 21 August 2026.
- AIA NZ pays $790M in total claims in 2025, AIA New Zealand, 12 May 2026
- AIA NZ Claims Compass #3, Spotlight on Heart Claims, AIA New Zealand, 2026
- AIA NZ pays $829.6M in total claims in 2024, AIA New Zealand, 8 May 2025
- AIA NZ Claims Compass #2, Spotlight on Mental Health, AIA New Zealand, 2025
- Delivering for members more than ever, Southern Cross Health Society, 30 September 2025
- Healthy, young, but medical insurance premiums rise 25 percent in a year, RNZ, 29 October 2025
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Explore related pages: Life Insurance, Income Protection, Health Insurance, Trauma Insurance, For Brokers.