Working Harder, Performing Better.

Annual Review

2012/13westfieldhealth.com

Registered Office: Westfield House 87 Division Street Sheffield South Yorkshire S1 1HT

© Westfield Health 2013

Westfield Health is a trading name of Westfield Contributory Health Scheme Ltd., which is authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority. Details of registration can be found by accessing the Financial Services Register on line at either the PRA or the FCA websites or by contacting the PRA on 0207 601 4878 or the FCA on 0800 111 6768. Westfield Health is not for profit and registered and incorporated in England and Wales as a company limited by guarantee. Registered no. 303523.

Westfield Health is a registered trademark.

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Certificate Number 5304 ISO 9001, ISO 14001, OHSAS 18001

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Jill Davies reviews another outstanding annual perfomance, the new look Westfield Health branding and our continued commitment to providing the most groundbreaking plans and benefits for our customers.

In a record breaking year which has taken the total policyholders we serve to 401,000, the highest in our history, we look at the key roles played by Sales and Marketing, Finance and Operations.

As a customer-focused business, nothing matters more than the opinions of the people we serve. Key clients discuss just how well our innovative health cover has worked for them over the past year.

This year, we have donated more than £600,000 to the NHS and medically related charities, helping to keep thousands of people across the country at their healthy best.

Profiling the Westfield Health board members who are working together to keep our market leading brand at its best every day, for every single customer.

Chairman’s ReviewMeet the Board

Chief Executive’s Review

Executive Directors’ Reviews

Case Studies

The Westfield Health Charitable Trust

ContentsGraham Moore reviews the successes and achievements of 2012/13 and our sustained focus on delivering our products and services in the most innovative, effective and ethical way possible.

Contents 03

4

Meet the BoardWorking together to keep our market leading brand at its best.

ChairmanGraham Moore MSc, FCIPD, DUniv

Chief ExecutiveJill Davies FlnstSMM

Executive Directors

Sales and Marketing DirectorPaul Shires MBA, FCMI cert PFS, CeMAP

Graham joined Westfield Health as Chief Executive in 1985 after more than 20 years in personnel management. He additionally became Chairman in 1995. Graham stepped down as Chief Executive in 2008 to concentrate on his role as Non Executive Chairman and his involvement with the Westfield Health Charitable Trust.

Jill became Chief Executive in 2008 after leading the Sales and Marketing Team for more than 13 years.

She has strategically guided the company’s product innovation and award-winning customer service, helping it become the UK’s leading provider of corporate-paid health cash plans, with almost 37 per cent market share and more than 400,000 policyholders.

Vice Chaiman Nick J A Hutton MBE

Nick was appointed to the Westfield Health Board in 1995, following a distinguished career in business and public life.

Senior Independent Director Professor Pat Cantrill MSc, BA (Hons), RGN RHVT, TC

With more than 40 years experience in the NHS, Pat was appointed to the Board in 2006, became Senior Independent Director in 2011 and is a member of the Remuneration, Health and Compliance sub-groups.

As Executive Director for Sales & Marketing, Paul is responsible for developing and managing appropriate products, distribution channels and communications.

He constantly reviews the environment in which Westfield Health operates to ensure a market leading position is maintained and broader business objectives are met.

Operations DirectorJulie Gill DMS

Julie leads the operational side of Westfield Health, including customer service processing teams, the call centre, facilities management and HR, Training and Development.

She has worked for the business for more than two decades, and, under Julie’s leadership, the company has been recognised for its world-class customer service, business excellence and efforts to counter fraud.

Finance DirectorRob Evans BSc (Hons), FCA, MBA

Rob is responsible for the Finance and Audit and Compliance Teams, as well as Westfield Health’s technology and IT infrastructure.

He and the team monitor and report on the company’s financial and organisational performance, ensuring statutory and regulatory duties are completed and all systems, processes and controls are in place and operating effectively.

04 Annual Review 2012/2013 Meet the Board 05

Non Executive Directors

Kevin Bardsley LLB (Hons) Kevin Bardsley was an associate solicitor at Oxley & Coward, then Benson Burdekin before becoming an in-house solicitor at MALA Services Limited.

Dr. Catherine Ryan MBChB Catherine joined the Board in 2006 and is also a Trustee of the Charitable Trust. She has worked as a doctor in a GP practice in Sheffield for the last 11 years.

Humphrey J W Speight FCA As a member of the Institute of Chartered Accountants, Humphrey joined the Board in 2003 and has been the Chairman of the Westfield Audit Committee since its inception in 2003.

Lesley Welton Lesley joined the Board in 2004, following a career in sectors including retail, insurance, investment, engineering and manufacturing.

David J Whitney BA (Hons), MA, FRSA, AHSM David joined the Board in 2002 and is Chairman of the company’s Health Committee.

He also holds various roles at Chesterfield Royal Hospitals NHS Foundation Trust.

06 Chaiman’s Review | Graham Moore 07

Chairman’s Review

From the introduction of our groundbreaking Hospital Treatment Insurance, to our ongoing work to meet future regulatory changes such as Solvency II, each company development has been undertaken with a single goal in mind – to be the best we can for our customers.

As a not for profit organisation we have always followed key principles, such as supporting the NHS and ensuring our customers can access the healthcare services they need. During recent tough economic times, these values have never been more crucial.

People are increasingly holding the organisations that they choose to do business with to account, rightly demanding the highest ethical standards and often opting for the companies that give something back to the people and communities they work with.

At Westfield, these standards and a commitment to being a good corporate citizen is firmly embedded within our culture and company ethos.

In the last year, our Charitable Trust has continued to support the communities we work in, donating more than £600,000 to the NHS and medically-related charities across the

country, such as Transplant Sport UK , Weston Park Hospital Cancer Charity and Sheffield Children’s Hospital Charity.

From raising organ donor registration numbers in Medway down in Kent, to providing state-of-the-art healthcare facilities for cancer patients and young people alike, the Trust’s work has made a real difference this year.

And, our caring culture and commitment to excellence is something that is reflected in our growing number of policyholders – whose ongoing loyalty and support provides us with all the motivation we need to keep improving the service we provide.

We are very proud of what we have achieved in 2012/13, but none of it would have been possible without the hard work of staff across all levels of the business supported by the commitment of our Chief Executive, Jill Davies and her Executive Management Team. We will continue to strive to be a good corporate citizen, a great employer and a market-leading health insurer, now and in years to come.

Graham Moore Chairman

At Westfield we thoroughly believe that it’s not what you do, it’s how you do it, and this year we have endeavoured to deliver our products and services in the most innovative, effective and ethical way possible.

In the last year, our Charitable Trust has continued to support the communities we work in, donating more than £600,000 to the NHS and medically-related charities.

Annual Review 2012/2013

08 Chief Executive’s Review | Jill Davies 09

Chief Executive’s Review

It’s an exciting time for Westfield and our success to date has been outstanding. As with any successful business, we are constantly facing new challenges, but we believe that now is the right time to really focus on the future and to take the next step on our journey.

In challenging economic times and with increased regulation, we aim to live and breathe our core values and to never stand still.

We continue to expand in the age of a fast growing digital world, where customer expectations are increasing, and we value highly our loyal customers’ support in helping us to be the organisation we are today.

Our cultural values – Courage, One Team, Respect and Excellence – are our commitment to sustain and develop our business for the future benefit of our customers.

Jill Davies Chief Executive

This commitment has never rung more true than in 2012/13. For this is a time when many people are taking a closer look at the ethical standards of the businesses they deal with, and we are delighted to say our policyholder numbers have risen to record levels, reflecting our dedication to providing best in class health cover for our customers and to being a good corporate citizen.

Our courageous decision to be first to break the barriers of the industry and launch Hospital Treatment Insurance in 2012 has allowed us to expand our product options and evolve as a company to reinforce our pledge to helping more people stay at their healthy best throughout their lifetimes.

Benefits such as Doctorline™ and Best Doctors® have been introduced to provide our customers with the support they need to live a healthy life, at work, at home or in retirement.

And, through the work of our Charitable Trust, we have continued in giving back to the communities we work in, supporting the NHS and medically related charities to help provide for people to enjoy life, today and in the future.

Our new brand boldly encompasses all of these values, and our strapline, ‘Harder Working Health Cover’, summarises our commitment to continuous improvement and excellence for our customers and our staff.

It’s much more than a visual identity. It’s the essence of our culture, what we stand for as an organisation and the way we work – both with our customers and each other.

Every employee at Westfield has a part to play in the continued success and ongoing excellence of the business. We’re immensely proud of our people and what we achieve together, and the fact that we have this year won more awards than ever before is testimony to these achievements.

We believe that if we all pull together as one team, with one common goal and one true, defining sense of purpose, there’s nothing we can’t achieve. In 2012 /13 we achieved 72 new qualifications for our employees through training and, as we move forward, we intend to keep on nurturing and developing our people to ensure excellence in all that we do.

At Westfield we have worked hard to be – and stay – the best. We pride ourselves on treating our customers, our staff and our environment with respect and creating innovative new ways to make our products and, in turn, our policyholders better.

Since Westfield Health was formed almost a century ago, we have kept our focus clear – to provide access and help pay for health treatment and to be the very best we can for our customers, throughout everything we do.

Annual Review 2012/2013

10 Executive Directors’ Review – Sales and Marketing | Paul Shires 11

Executive Directors’ Reviews

This year has been a record breaker for the Sales and Marketing Team. We achieved more policyholder sales than ever before – over 79,000 – taking the total policyholders we serve to more than 400,000, the highest in our history.

We were the only cash plan provider able to grow our market share of both premium and policyholders, thanks to our ongoing commitment to provide innovative solutions to support the health of our customers.

The delivery of groundbreaking new products and added value benefits has allowed us to grow and, while the majority of our growth continues to come from the corporate market, we were delighted to see consumer and voluntary sales also increase.

We introduced two new benefits to our plans for no extra cost; Best Doctors® and Westfield Rewards. We enhanced Doctorline™ to allow policyholders to speak to a qualified GP via webcam, and our Health Club Concession, which now provides access to more gyms and health clubs, at a significant discount.

Communicating news of our achievements and raising our profile locally and nationally play a key role in Westfield’s continued growth. This year, the work of our PR Team reached more than 33 million people, with an Advertising Value Equivalent (AVE) of over £1.5 million.

It’s been an outstanding year for the Westfield Sales and Marketing Team, and we are looking forward to making 2013/14 even better as the changing NHS presents all health insurance providers with great challenges but even greater opportunities.

Paul Shires Executive Director, Sales and Marketing

Sales and Marketing

The introduction of Hospital Treatment Insurance (HTI) set a new precedent in the market and was exceptionally well received – being named ‘Most Innovative/Specialist Product’ at the 2012 COVER Excellence Awards, and one of the top PMI products of 2012 by Health Insurance Magazine.

Whatever our successes, we are always looking to better our achievements and so in 2012/13, we restructured both the sales and marketing teams to provide more focus on distinct areas of product management, communications, and key account management.

We also introduced a new Print Asset Management system (PAM), to allow us to personalise communications and build stronger customer relationships.

And, through enhancing our website and driving traffic through social media platforms, corporate leads have risen 21 per cent, and online consumer sales are up 18 per cent on 2011/12.

79,000More policyholder sales than ever before – over

Corporate leads have risen

21%

Annual Review 2012/2013

It is very pleasing to be able to report that premiums are once again on the increase, reaching £54.4 million – an increase of £0.4 million on last year. This is a result of policyholder numbers exceeding 400,000 for the first time in our history. The increase in customers has also meant an increase in the claims we have paid this year, up from £34.9 million to £36.4 million. We aimed to return more value to our customers and these results show we are achieving this.

This year, Westfield’s total company assets have surpassed the £90 million mark for the first time and our reserves have risen to more than £83 million. This financial security, combined with our not for profit status, allows us to make the right decisions for a long term sustainable future for our business.

This ongoing investment into improving our people, products and processes marks a real commitment from Westfield to grow while continuing to deliver a world class customer service through achieving greater operational efficiency.

Rob Evans Executive Director, Finance

Against a backdrop of ongoing economic instability and uncertainty within the NHS, we have continued to provide great value for our policyholders, helping them to access and pay for the health treatment they need.

Finance

12 Executive Directors’ Review – Finance | Rob Evans 13

These outstanding results provide us with the solid foundations required to continue and accelerate our programme of investment, aimed at creating best value products and services for our policyholders with state of the art systems and infrastructure. Our aim is to sustainably grow policyholder numbers – ensuring more people can continue to access the healthcare they need, when they need it.

We are making great progress with the upgrade of our IT and administrative systems and, despite a delay in the introduction of Solvency II (the new European financial framework for insurance companies), we are continuing the work needed to meet the directive’s requirements ahead of the expected 2016 implementation date.

Year ended31 March

2013 (£m)

Year ended31 March

2012 (£m)

Insurance activities

Net premium income / £m 51.1 51.4

Claims incurred 35.8 34.7

15.3 16.7

Net operating expenses 14.4 13.4

Surplus on general businesstechnical account 0.9 3.3

Investment and other activities

Investment and other income 2.6 2.9

Unrealised losses on investments 2.7 0.2

5.3 3.1

Surplus/deficit before charitabledonations and tax 6.2 6.4

Other charges – Gift Aid charitabledonations 0.4 0.9

Surplus/deficit on ordinary activitiesbefore tax 5.8 5.5

Tax on surplus/deficit onordinary activities 0.8 0.1

Surplus/deficit for the financial yeartransferred to reserves 5.0 5.4

Year ended31 March

2013 (£m)

Year ended31 March

2012 (£m)

Intangible assetsGoodwill - 0.4

InvestmentsLand and buildings 4.5 5.5

Other financial investments 68.2 60.6

72.7 66.1

Other assets

Tangible assets 0.6 0.7

Debtors 3.5 3.7

Cash at bank and in hand 12.9 13.2

Pension scheme asset 1.2 2.5

18.2 20.1

Total assets 90.9 86.6

Reserves

Property Revaluation Reserve 0.5 1.4

Investment Revaluation Reserve 13.3 9.7

Revenue Account 69.3 68.4

Total reserves 83.1 79.5

Liabilities

Technical provisions 3.0 2.7

Provisions for other risks and charges 1.5 1.1

Creditors 3.3 3.3

Pension scheme liability - -

Total liabilities 7.8 7.1

Total reserves and liabilities 90.9 86.6

Summary profit and loss account Summary balance sheet

Charitable Donations £0.4m

Tax Payable (including deferred tax) £0.8m

Retained Surplus £5.0m

Claims £35.8m

Operating Expenses £14.4m

We have summarised the financial statements to give policyholders and sponsoring companies an overview of Westfield’s financial position.

They do not contain all of the information that is included in the full audited Annual Report and Financial Statements.

A copy of the full Annual Report and Financial Statements, which contain an Auditor’s unqualified opinion, is available from Companies House.

Annual Review 2012/2013

In 2012/13, I am proud to report that with more than 649,000 claims processed by our Customer Service Team this year, we have consistently upheld the levels of accuracy, efficiency and care that each of our policyholders deserve.

We are now ensuring that our customers can cover the cost of their healthcare even quicker by reducing the average processing time by more than 18 per cent from last year reaching just 1.77 days per claim. Our commitment to being more environmentally friendly while sustaining excellence was reinforced, with the amount of policyholders receiving email remittance advice rising to 250,000.

In addition, our Call Centre received 182,000 telephone calls, with team members answering in an average time of just 10 seconds.

Through our ongoing work with the Institute of Customer Service (ICS), we have received ServiceMark reaccreditation and, following a survey of our customers, rated ‘World Class’ for the second year running – with a seven per cent increase in our survey score to 88.8, based on the ICS UK Customer Satisfaction Index.

Our hard work was recognised at both the Sheffield Chamber of Commerce and Doncaster Chamber of Commerce Business Awards, where we won the ‘Excellence in Customer Service’ category at each event.

And, following our submission for a UK Excellence Award in April 2012, we were awarded ‘Recognised for

Excellence (R4E) 5 star’ status under the European Foundation for Quality Management, through the British Quality Foundation.

This commitment to care extends to our staff. Through our continued work to develop ‘Lean Thinking’ throughout the business, we have developed 95 employees in the past year to expand their skills and knowledge of other areas of the organisation through training and improvement projects.

Our annual Employee Satisfaction Survey results showed an increase to 73.2 in 2012/13, exceeding our target of 72.5 and providing us with invaluable staff feedback on the priorities of our workforce, helping to shape future company developments.

We have also supported the development of the business as a whole, working to underpin the substantial overhaul of our IT and admin systems and minimise any potential impact the changes may have on the customer experience.

In 2012/13, the hard work of our Operations Department has been evident throughout the great feedback we’ve had from customers and our industry peers, and as our policyholders continue to grow in numbers, the high standards we demand of ourselves will keep rising too, ensuring our customers continue to get the very best.

Julie Gill Executive Director, Operations

At Westfield, as our policyholder numbers have risen to record levels, our focus on delivering outstanding levels of customer services continues to be unwavering.

Operations

73.2Our annual Employee Satisfaction Survey results showed an increase to

14 Executive Directors’ Review – Operations | Julie Gill 15Annual Review 2012/2013

Our Call Centre received 182,000 telephone calls, with team members answering in an average time of just 10 seconds.

16 Case studies

We offer Westfield Health as a benefit for all of our contracted employees. The process to claim back healthcare fees is extremely easy for our employees to follow and their Customer Services Team are readily available to help with any queries.

We would not hesitate in recommending Westfield Health to other organisations.

Human Resources Manager Nottinghamshire Hospice Angela Fallon

I used the consultation benefit to get an appointment at the hospital and was seen within a week. A specialist ran a series of tests and they sent me for a CT scan in London, where again, I was seen within a week. I am really grateful for the cover.

Export Sales CoordinatorLe Mark GroupHannah Attfield

The Plan came in very useful when I dislocated my shoulder. I used the consultation benefit to speed up access to surgery and was seen a month quicker than if I had waited on the NHS. I have also found it very useful for eye tests and dental check-ups – it is nice to be able to claim the money back for everyday healthcare needs.

HR and Training Officer Doncaster Culture and Leisure Trust Katie Ogley

We looked at a number of providers but chose Westfield because of the range of benefits available. We also considered the plan very good value for money.

I would say just about every benefit has been used at some point by staff, with the dental benefit in particular very popular. I’m aware some staff have increased their level of cover by paying a contribution themselves and others have added spouses and partners to their plan.

Human Resources Manager Autoline Claire Curran

The new benefits arrangements have been extremely well received by our people, and I am absolutely delighted that so many have taken them up. We are now able to offer health benefits that suit everyone, as well as being able to better manage and control our costs.

Human Resources Manager London Luton Airport Alasdair Campbell

Hard work will always pay offOur customers describe the difference Westfield makes to their business and their employees.

I use the optical and dental benefits and I really value the chiropody benefit. It’s good to have access to treatments that you perhaps wouldn’t consider essential.

HR Officer CrossReach June Grant

Being a Westfield policyholder not only means I can save money and claim back all my dental and optical bills but I am now able to shop without feeling too guilty.

I registered with Westfield rewards straight away and in the past month alone I have saved approximately £24 by using my reloadable cards.

I’m so glad my employer did their research and chose a benefit that works for everyone in the company no matter what their age or interests.

HR Co-ordinator HLM Jill Fedyk

17Annual Review 2012/2013

The Westfield Health Charitable Trust

Since our beginnings almost a century ago we have continued to give back to the communities we work in, and 2012/13 has been no exception.

Through our dedicated Charitable Trust, we have donated more than £600,000 to the NHS and medically related charities, helping to keep thousands of people across the country at their healthy best.

A specialist department at Sheffield’s Royal Hallamshire Hospital is now able to treat more patients and carry out an increased number of less invasive surgical procedures thanks to our gift of £25,000 to fund a new Double Balloon Entreroscopy System (DBE).

In addition, Helen’s Trust – a charity that provides support and care for terminally ill people living at home in North Derbyshire – has been able to purchase new equipment for its patients and provide transport to and from hospital appointments, thanks to our donation of £10,000.

In 2012 we were especially proud to continue raising awareness of the importance of organ donation by once again sponsoring the British Transplant Games, when they took place in Medway, Kent. The event was a resounding success and resulted in a 20 per cent increase in NHS Organ Donor Registrations across the region.

This year also marked the first full 12 months of the Employee Community Group (ECG), who arranged various employee-led activities such as fundraising events and volunteering.

The group has proved popular and total donations from staff through the ECG’s activities exceeded £1,500, with a large proportion of that sum being allocated to their top three charities for the year – NSPCC, Cancer Research and the British Heart Foundation.

These examples highlight just a few of the ways we are working harder to improve and nurture the health and wellbeing of communities across the country, and demonstrates our unfaltering commitment to providing people with access to the healthcare services and facilities they need.

From a £20,000 donation to Nottingham-based charity, Headway which helps people affected by brain injuries, to £18,500 to help the Sheffield Royal Society for the Blind (SRSB) who purchased a new minibus after its previous one was stolen, we have made a positive difference to numerous causes and appeals.

Making a healthy, positive difference to thousands of people across the country every year.

£600,000

£20,000

£10,000

20% donation to Headway, to help people suffering from brain injuries.

to Helen’s Trust to fund support and care for terminally ill people living at home.

donated to the NHS and medically related charities in 2012/13.

increase in NHS Organ Donor Registrations in Medway, Kent in 2012.

Nottingham-based charity Headway

Our Employee Community Group (ECG)

Whirlow Hall Farm £9,970 donation

St. Matthews House £5,000 donation

Lost Chord £5,000 donation The British Transplant Games

18 The Westfield Health Charitable Trust 19

The Royal Hallamshire Hospital

Annual Review 2012/2013