Youi boosts NZ business despite bad press
Insurer Youi NZ has increased its business in New Zealand, despite bad press over its former dodgy sales practices.
Youi, which is South African-owned, increased its premium revenue by 19% to $31.1 million in the year to June 30.
But it paid 8% more in claims ($20.9 million) over the year, so the amount it paid out in claims compared to the amount it received in premiums fell from 74% to 67%.
The business, which launched in New Zealand in July 2014, narrowed its loss by 41% from $11.1 million to $6.5 million.
Youi's accounts show it reaped $171,000 from policy cancellation fees, up from $161,000 a year earlier.
Its wage bill decreased from $23.8 million to $22.3 million over the year, while its KiwiSaver expenses fell from $513,000 to $478,000.
Youi’s parent OUTsurance Group noted in its latest annual report that “negative press” and an “intensively competitive environment” had kept a cap on business volumes over the year.
“Following from the compliance breaches experienced in the Australasian business in 2016, a significant investment has been made to bolster oversight and control of client engagement activities across the group to eliminate the occurrence of sub-standard customer outcomes.”
In December, Youi was fined $320,000 for misleading sales practices. It could have been fined up to $9 million but significant discounts were made for Youi’s admission of guilt and reparation to victims.
The Fair Trading Act charges, brought by the Commerce Commission, included misleading its customers about their ability to get online quotes, telling them their bank or credit card details were required in order to get a quote, and asking for payment for unsolicited policies.
A spate of customer complaints was made to the commission from March 2015 to February 2016 though the charges date back to 2014 when the insurer first launched into the New Zealand market.
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