Claims data from South Africa’s oldest insurer shows the leading causes of death and illness types

South Africa’s oldest insurer Old Mutual has published its Claims Statistics Report for 2020 showing claims trends at the group over the last year.

The financial services group said that it paid R14 billion in risk cover claims in 2020. The pay-out includes underwritten, non-underwritten and corporate claims and represents a year-on-year increase of 24%.

The group said that several trends relating to the spread of Covid-19 were evident in the new figures. Yet despite a challenging and constantly evolving landscape, it was proud to uphold a total pay-out ratio of 98% in underwritten claims.

“As evidenced in our report, the increasing toll of the pandemic stresses the significance of having sufficient cover in place to protect individuals and their loved ones against the risks of unexpected death, disability, retrenchment or illness,” said John Kotze, retail protection product head at Old Mutual.

The Old Mutual report for 2020 unpacks the group’s underwritten risk cover claims, which total R6.48 billion of the overall amount paid. It also reflects a significant rise of 22%, especially when compared to the previous 3-year average increase of 9.6%. It consists of the following:

  • R5.17 billion in Death cover claims;
  • R871 million in Illness cover claims;
  • R436 million in Disability cover claims;
  • R13 million in Retrenchment cover claims.

Causes of claims

While cancer & tumours (23%), cardiovascular diseases (19%) and accidental death (19%) remained the top three causes of death claims paid, Kotze said the sharp rise in the number of people claiming for respiratory system disorders (60%) under death cover was mostly attributed to the widespread Covid-19 infections.

“Conversely, a positive impact of the pandemic was the 27% decrease in the number of motor vehicle accident death claims, almost certainly linked to the extended periods of restricted travel during lockdown,” Kotze said.

In the Illness cover category, the group saw an 18% increase in the pay-out amount compared to the previous year. Its pay-out ratio also rose from 89% to 95%.

The Big Four illnesses (namely cancer, heart attacks, strokes and coronary artery bypass grafts) contributed to 70% of the illness claims paid in 2020, with cancer still reflecting the largest proportion.

The effects of the pandemic were equally apparent in the Disability cover category, where Sickness Income cover claims increased 3.5 times year-on-year.

The highest cause of claims in this category was under ‘infectious diseases’, the term Old Mutual uses to refer to claimants infected by Covid-19.

“This is the first time that ‘infectious diseases’ has shown up in the report in double digits (10%) in the disability income category. What is also worth noting is the 25% rise in the pay-out amount for disability income claims this year,” Kotze said.

Big changes were also noted in the Retrenchment cover category, which revealed a R3 million increase in retrenchment claims (30% increase on 2019). “This is undoubtedly again a consequence of lockdown, which caused many people to lose their jobs,” said Kotze.

Within this category, just over a third of claimants were between the ages of 30 and 40, and 76% were male.

“While 2020 has given us deeper insight into the impacts of the pandemic on our customers and the insurance industry,” said Kotze. “We are certain that the longer-term implications will become even more apparent over the next few years. We will continue to adapt and evolve our protection solutions to meet the changing needs of our customers.”

Read: The most complained-about short-term insurers in South Africa

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Claims data from South Africa’s oldest insurer shows the leading causes of death and illness types