As the Prime Minister’s lockdown road map creeps towards fruition we enter ‘reporting season’ in which the big insurers provide a performance update.
The UK’s largest insurer is Aviva, which has reported that they paid out over £1billion of sums assured across more than 50,000 individual protection policyholders and their families during 2020.
Of this £1billion, £38.9m was for primary COVID-related claims. Most of this has been life insurance settlements to bereaved families, but also includes often overlooked income protection insurance claims for policyholders whose ability to work has been significantly impacted by COVID and long-COVID. Aviva also reports having referred eligible policyholders for ongoing rehabilitation support relating to the longer-term effects of COVID.
Sadly, Aviva reports their anticipation that critical illness claims will rise markedly in 2021 as the vaccination roll-out and positive impact of lockdown allow medical services to return to pre-COVID levels and the backlog of undiagnosed non-COVID conditions starts being addressed.
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At the time of reporting, insurers always have a number of new claims which are being processed. Notwithstanding “work in progress”, Aviva report:
- 99.3% of life insurance, over 50s insurance and whole-of-life assurance being accepted.
- 92.7% of dread disease critical illness claims being accepted (paying £314million to less than 4,300 policyholders)
- 87.5% of claims for income protection payments were accepted, paying £44.7million to 4,400 households. Musculoskeletal and mental ill-health were the most common reasons for the claim, and Aviva referred more policyholders to their rehabilitation support than in previous years. These services, which include counselling and physiotherapy, helped 73% of claimants to either remain at, or return to, work.
Aviva report that cancer remains the most common reason for adult critical illness claims, accounting for 78% of all female claims and 49% of all male claims. The volume of cancer claims is down on previous years, this is likely as a result of delays in diagnosis and treatment. Aviva has reported a concern that there will be a significant rise in cancer diagnosis during the remainder of 2021 and into 2022 as COVID restrictions decrease and consumers regain the confidence to visit their family doctors again.