ealthcare giant Bupa is braced to take a knock of almost a quarter of a billion pounds after a Supreme Court case in Chile threatened the future of its operations in the country.
The ruling, made last year, found that the firm’s policy of setting health insurance premiums based on gender and age were unconstitutional and demanded that compensation be issued to all customers affected.
A preliminary assessment by the Chilean health authorities found that Isapre Cruz Blanca, a subsidiary of Bupa, would face repayments totalling £229 million under draft legislation, a figure which Bupa warned was likely to increase over time.
Bupa warned there was “inherent political and regulatory uncertainty surrounding the implementation of the Supreme Court judgement.”
“Depending on the outcome of the current uncertainty, [the judgement] could result in material liabilities arising and material ongoing losses within the Isapre business.”
The firm upped its provision for repayments from £100 million to £160 million but added the “final impact is likely to differ materially from this value.” The deadline for the implementation of a new policy for setting insurance premiums has been extended to November 2023.
Chile is one of Bupa’s biggest markets outside the UK, generating more than £1 billion annual turnover.
Bupa today posted global revenues of £7.4 billion for the first six months of the year, up 9% on 2022. Pre-tax profits rose by 5% to £241 million. Profits in the UK more than doubled to £140 million, which the firm put down to a ‘turnaround’ in its private medical insurance business Bupa Global.