iSelect, Ley to discuss ‘worrying trend’

The comparator website’s head will join Sussan Ley to discuss the dearth of younger people buying insurance.

Scott Wilson said fewer “new to industry” customers taking out health insurance. Picture: Britta Campion /The Australian.

The head of comparator website iSelect, Scott Wilson, will head to Canberra tomorrow to meet Health Minister Sussan Ley, to discuss health insurance reform as he warns of a “worrying trend” of younger people not buying insurance.

Mr Wilson, who today delivered a strong second half result including a 34 per cent jump in annual net profit after tax to $12.9 million, said he would meet Ms Ley and her advisers because the company was keen to take an active role in reform discussions.

“This is something iSelect has not done well in the past,” he said.

“There are more than 1.3 million Australians that come and compare health insurance with us each year.

“We are in a unique position with that level of data to be able to help the government. We have worked closely with the Minister and her advisers over the last six months on the trends we are seeing.”

Mr Wilson said the company gathered, in real time, information on what customers say is important to them and what is not, and which products and features and benefits they are looking for, plus what they don’t value.

“We have a core role to play in any of the reforms that happen,” he said.

“We will continue to use technology and data to help customers move quickly, get on the right product and ensure they are covered, which will help the industry overall and take pressure off the public system.”

The federal government is looking to reform the private health insurance sector amid rising affordability concerns and as new membership growth slows.

Minister Ley has called for more transparency in products and is looking to introduce a simplified system by labelling a policy “gold, silver or bronze.”

Mr Wilson added that data from the second half of financial year 2016 showed a worrying trend of fewer “new to industry” customers taking out health insurance, which he said had been a trend over the past few years.

“That is something we want to work with the government on as part of reforms - how you encourage more younger Australians to take up health insurance,” he said.

The iSelect chief executive said while the company had a strong period from January through to May, with a record result in the March trading period, June was impacted by the Federal election.

He said during that period there was a softening in the market and fewer customers entering who were new to health insurance.

“When you look at our business about 40 per cent is new to industry and 60 per cent is switch,” he said.

“We’re seeing strong growth in the over-60 segment. That is customers who still want private health insurance but affordability is forcing them to look at their policy. And they are also reviewing whether it covers what they need at the point they need it.”