Southern Cross is back in surplus after two years in the red, and says premium rises should ease.
New Zealand's largest health insurer made a group surplus of $146.9 million in the year to 30 June 2026. That follows a combined deficit of $140.0 million over the two years before it, according to its announcement of the FY26 annual report on 29 September.
Claims cost growth slowed to 7.1%, down from 12.2% the year before. Southern Cross says it expects "premium increases to moderate from the increases experienced over the past three years". It gave no figure for what members will pay, and no 2026 renewal rate.
That's an expectation, not a commitment. Claims costs are still rising, just more slowly.
Southern Cross also says its claims cost growth is "considerably lower than the rest of the health insurance sector", but gave no sector numbers to back that up.
It paid out a record $1.8 billion in claims, up 5.5% on FY25. That's an average of $7.2 million, or 15,000 claims, every business day.
Of every premium dollar it took in, 88 cents went back to members as claims. In FY25 it was 94 cents, according to the 2025 annual report summary. By our sums that leaves 12 cents, up from 6.
It isn't all profit, because the rest also pays running costs, and Southern Cross hasn't said how it splits them.
The FY25 deficit was $51.8 million, after $88.2 million the year before, which adds up to the $140.0 million. In that report Southern Cross said it had spent reserves "to absorb some of the increased cost of claims on behalf of members, rather than passing the full impact on via even higher annual premium increases".
A surplus could be read as those reserves being rebuilt. The announcement doesn't say so.
Southern Cross says "healthcare demand and claims cost escalation are returning towards more normal levels".
Health insurance is the cover these premiums buy.
