Police Health Plan maintains a robust balance sheet

It benefits from a high penetration rate within the police force.

New Zealand-based Police Health Plan’s (PHP) operating performance, though adequate, has shown a decreasing trend, with a five-year average return-on-equity ratio of 3.5%, AM Best said.

The company has increased premium rates to counteract higher loss ratios and aims to maintain break-even performance in the long term.

Although in the case its claims experience progresses toward above standards, AM Best foresees PHP to realign premium rates immediately, as it has done previously.

AM Best’s negative outlook revision reflects increasing pressure on PHP's operating performance and declining risk-adjusted capitalisation due to underwriting losses and limited financial flexibility. 

Despite this, PHP's balance sheet strength remains very strong, supported by the strongest level of risk-adjusted capitalisation per Best's Capital Adequacy Ratio (BCAR).

PHP, a not-for-profit insurer, provides health insurance exclusively to current and former New Zealand police members and their families. 

It benefits from a high penetration rate within the police force, low distribution costs, and close integration with the New Zealand Police Association (NZPA).

AM Best's assessment of PHP's business profile remains neutral, factoring in its efficient cost structure and synergy benefits from its relationship with the NZPA.