Health and life insurer Vitality slipped into the red despite its revenue surging by almost £100m during its latest financial year, it has been revealed.
The London-headquartered group has posted a loss before income tax of £168,000 for the 12 months to 30 June, 2024, after having achieved a profit of £37.9m in the prior year.
However, the company posted a profit before financing and income tax of £29.5m, down from £64.6m.
Newly-filed accounts with Companies House also show that the firm’s insurance revenue surged from £894.9m to £991.5m over the year.
The group includes Vitality Life, Vitality Health Insurance, Vitality Health, Vitality Corporate Services, Better Health Insurance Advice and the joint venture Healthcare.
Its health division’s insurance revenue rose from £634.6m to £698.4m while its new business sales also increased from £109.8m to £117.4m.
Its life division’s insurance revenue also rose from £260.4m to £293.1m and its new business sales grew from £80.3m to £83.1m.
The group said: “Both Vitality Health and Vitality Life have seen robust year-on-year growth broadly consistent with lives growth.
“Overall, an increase in new business sales year on year, on track retention levels and dynamic market pricing has led to growth in premium income year on year.”
On its new business sales, the group added: “Strong year-on-year growth was driven by increased relevance of PMI [private medical insurance] and life insurance in the wake of the Covid-19 pandemic as well as Vitality’s continual innovation and adoption of new ways of doing business both digitally and telephonically.”
During the year the remaining motor insurance policies which had been offered by Vitality Car were largely run off, with the remaining policies expiring by August.
That followed a decision being made in June 2023 to not offer members cover beyond their plan year after the UK car insurance market “experienced unprecedented claims inflation which led to significant price increases”.
Those increases were passed onto Vitality Car members by underwriting Covea.
Vitality said the rises “materially impacted Vitality Car’s ability to deliver value for good drivers”.
A decision was also made in February 2024 by the shareholders of Healthcare Purchasing Alliance, which Vitality Corporate Services owned 50 per cent of, to place it into voluntary liquidation. The process was completed in June.
Vitality bosses ‘remain optimistic’
A statement signed off by the board said: “Vitality’s core purpose is to make people healthier and enhance and protect their lives.
“By focusing on lifestyle as well as illness and death, Vitality will create awareness of the real issues facing society, empower members to make positive change and contribute towards a healthier nation.
“Heath and wellbeing will remain a strong feature of the products offered as the directors believe that the promotion of good health will bring benefits in terms of lower claims rates, as well as leading to improvement to individuals’ lifestyles and health, their productivity and public health generally.
“With this vision and purpose Vitality aims to build a substantial profitable business.
“Over the period, there has been continued geo-political uncertainty and conflicts, increased economic uncertainty and high inflation.
“Vitality is closely monitoring and managing the associated risks and remains committed to supporting its staff and customers as these emerging challenges are navigated.
“Despite a continued complex and challenging macro-economic and trading environment, given the strong performance in the year to 30 June, 2024, the directors remain optimistic about the continued growth and financial performance of Vitality and continue to build for the future.”