HCF and HBF plan merger to grow for the benefit of members

Sydney, Monday, 19 February 2018: Australia’s largest not-for-profit health fund, HCF, and Western Australia’s largest health fund, HBF, are considering a merger that would see HCF and HBF hold approximately 18.4% market share and provide members of both funds the benefits of scale required to compete with the larger private health insurers. The merger is a logical fit, given both funds’ not-for-profit structure and member-first approach.

Any merger will be subject to regulatory approvals and other conditions. The respective Boards and Councillors of HCF and HBF, responsible for ensuring members’ interests are protected, must approve the proposed merger.

Sheena Jack, HCF’s CEO and Managing Director, said a merger of HCF and HBF, Australia’s third and fifth largest health funds respectively, would give the not-for-profit health insurers a greater voice in the industry.

“The not-for-profit business model exists for its members, rather than shareholders and plays a vital role in our economy, not just in private health insurance but across many industries. The best interests of our combined membership would, as always, be our number one focus,” Ms Jack said.

“This merger of equals would provide a significant increase in size which will enable greater benefits to be passed on to members. Strategically, this merger would create a truly national player with combined strength to grow both brands and better compete in what is a challenging industry,” Ms Jack added.

HCF Chairman, Robert Goaley, said HCF’s number one priority has always been its members and this will continue.

“HBF lives by that philosophy too. Combined, we could reduce upward pressure on premium increases due to an enhanced competitive position in the market and offer a superior customer experience,” Mr Goaley said.

The Chairman said both not-for-profit foundations will be maintained.

Key details of the proposed merger include:

  • A merged entity would have a combined asset position of $4.0 billion, enabling reinvestment in the business and minimising future premium increases.
  • If approved by the Councillors of both organisations, the merger could be completed in the middle of the year following regulatory approvals, including the ACCC and APRA. Until these approvals are obtained, HCF and HBF will continue to operate as they currently do.
  • If approved, an entity will be established with a Board comprising equal numbers of Directors from HCF and HBF. All HCF and HBF Councillors will be offered the opportunity to maintain their governance roles over the merged group.
  • After any merger, there will be a transition period in which the operations of HCF and HBF will be combined.

HCF will provide another update on the proposed merger following the vote of Councillors next month.

Notes: Last month, HCF announced its average premium rate increase of 3.39%, the lowest for 16 years, and the lowest of the major funds, while the industry average was 3.95%.


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HCF, leading not-for-profit health fund protecting Australians since 1932, covers over 1.5 million members with health and life insurance, travel and pet insurance. On average over the last five years, HCF has paid out more cents in every dollar in premiums to members as benefits than the industry average. With over 35,000 specialists participating in its Medical Gap Cover Scheme and approximately 10,000 providers participating in its 100% back More for You programs, HCF gives members access to quality health care with no gaps or minimal costs compared to non-participating providers. To empower members to put their health first, HCF also offers a range of health and lifestyle services including its My Health Guardian health management program, mobile Victor Chang Health Checks and My Global Specialist second opinion service. HCF’s national network of retail outlets and Australian-based call centres have earned multi-award winning status. HCF members also have access to low cost, high quality services at HCF Dental Centres and HCF Eyecare Centres. Having invested more than $17 million to support health services research through the HCF Research Foundation, HCF is devoted to investing in the future of Australia’s health. To learn more about HCF go to hcf.com.au/about-us


HBF has been Western Australia’s leading health insurer for more than 75 years and remains one of the best known and respected brands in WA. With over a million members and 8% of the Australian health insurance market, it is the second largest not-for-profit health insurer in Australia.
Almost 90% of HBF’s members reside in Western Australia and have access to a range of free or subsidised health and wellness services, including free fitness training, health checks, flu vaccinations, weight loss programs and sleep apnoea services. HBF holds the franchise for the Friendlies Pharmacy group and provides a range of preventative health services free of charge or at discounted rates through Friendlies Pharmacies.
In addition to providing Hospital and Extras insurance, HBF sells HBF Life Insurance (underwritten by Zurich Financial Services Australia) and HBF home, car and travel insurance (underwritten by IAG).
Each year tens of thousands of Western Australians take part in the HBF Run for a Reason, the largest walking and running event in Western Australia and second only to the Sydney City to Surf nationally.
Key numbers as at June 2017: Total members: 1,033,657; WA members: 921,587; Revenue: $1.62b; Benefits paid: $1.56b; Employees (FTE): 810