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11 October 2021
Fidelity Life’s core business continued to perform well in the 2021 financial year as it boosted transformation spend and remained resilient against the economic impacts of COVID-19.
Underlying profit for the country’s largest locally owned life insurer for the year ended 30 June 2021 rose to $22.5m from $20.3m in 2020. Key drivers were a $6.1 million uplift in net premium revenue off the back of strong new business, fewer than expected policy lapses and robust expense management.
The company paid $130.8 million in claims to its customers compared to $139.7 million in 2020.
Total comprehensive income fell to $4.3 million from $17.9 million in 2020, reflecting a total of $9.3 million invested in key transformation projects (net of tax), including the firm’s new technology platform and the proposed acquisition of Westpac Life. In addition, a sharp rise in government bond rates had a $7.3 million impact (net of tax).
Chair Brian Blake said the $400 million Westpac Life deal was one of the most significant events in the company’s history and, once completed, would see Fidelity Life welcome Ngāi Tahu Capital as a major shareholder alongside the NZ Super Fund.
“As well as strengthening our New Zealand-owned credentials and providing greater access to capital, having two iconic New Zealand investors on our share register sends a strong signal to the market about the quality and potential of Fidelity Life.”
CEO Melissa Cantell, who started at Fidelity Life in January 2021, said she was pleased with the firm’s achievements and was looking to the future with confidence.
“We’ve worked hard this year and put strong foundations in place. We continued to invest in our transformation, while at the same time delivering an underlying result which shows our core business of providing life insurance to New Zealanders is performing well.
“Looking to the future, there’s a lot to be excited about as we work towards our aspiration to reimagine life insurance. Completing our technology build and the game-changing acquisition of Westpac Life will be key, as will ensuring we maintain our relentless focus on our customers.”
Fidelity Life’s 2021 annual report can be found here.
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