The insurer took in $484.6 million in premiums and paid out 78% or $378.6 million in claims over the year. The result also includes higher investment income of 25.9 million compared to $15.4 million in the previous year.

The insurer earlier this year announced it would hold or reduce premiums for a large proportion of tis members after a reduction in the claims to premium ratio and good returns on investments.

Chief executive Ian McPherson says the ratio of 78% claims over premiums is low - a figure of above 80% was the norm. In recent years it has overed around 85%, and this is the target for the coming year.

The insurer warns that premiums will have to rise in the future, at an average of about 5% a year, although it points out that this is lower than the average rise in health costs of 8% a year.

The society caused a storm three years ago when it moved to age related premiums and its older members were hit with large increases. That was followed by a loss, which the insurer has since clawed back.

The group’s operating costs for the year were $68 million, an increase of $11.4 million, reflecting what Dr McPherson calls “an intensive year for the organisation”.

That increase includes the costs of the development and launch of Activa, the country’s first health management account. Activa - which was launched after the balance date – is aimed at people who would like to put more aside for their healthcare but feel they cannot afford full health insurance.