There has been much focus on claims statistics in recent times, with protection insurers publishing information to prove that claims are indeed being paid and help show the value of these products.

There’s been a lot of progress too with all major insurers now publishing their statistics. And the results speak for themselves. The latest statistics from the ABI show that in 2013 almost 100,000 claims were paid, totalling over £3 billion across the whole industry1. This emphasises how protection has a significant role to play in protecting society, and can help take the strain off of government spending.

For a relatively young company it was also pleasing that VitalityLife has been able to publish some great claims statistics. In 2014 we paid 99% of life claims, 98% of income protection claims and 91% of serious illness claims. The total amount paid out also increased 66% from 2013 to a total of £25 million, reflecting the growth of the business, and the maturing of the in-force book2.

While claim statistics help improve transparency and demonstrate that claims are being paid, they do have their limitations which advisers and customers should be aware of, particularly if they are being used to compare providers. For example, there is still not complete consistency between providers in the way claims statistics are calculated. Also the claims paid do not help compare what’s covered by different policies. For example, a customer is up to twice as likely to claim on Serious Illness Cover compared to traditional Critical Illness Cover due to the coverage of more conditions and wider policy definitions3.

ARE THERE OTHER WAYS TO SHOW VALUE?

If it’s about showing the value of protection policies, then there are other possible metrics. How about helping customers understand their health and detect illnesses at an earlier stage, before they become more serious? By providing discounted health screenings insurers can help customers do exactly that. In fact, during 2014 over 21,000 VitalityLife members had a discounted healthcheck (4), showing that there is more than one way for protection policies to provide value to customers.

MORE CLAIM STATISTICS FOR VITALITYLIFE IN 2014:

  • A total of 725 claims paid
  • Average age of life cover claimants was 56 and for serious illness it was 44
  • The largest claim paid was £2,003,567 for Life Cover and £502,032 for a Serious Illness Cover

Sources

  1. www.abi.org.uk/News/News-releases/2014/05/Protection-Claims-2013-QA
  2. VitalityLife 2014 claims statistics
    1. Hannover Re UK Life Branch August 2013
    2. Estimates are based on Hannover Re UK Life Branch’s interpretation of the general population incidence rates and their estimated view of future rends. Incidence rates for the entire population may be different to those lives that take out life insurance products.
    3. The typical critical illness (CIC) product is a comprehensive one and covers most conditions seen in the market.
    4. VitalityLife estimates are based on the VitalityLife Plan with Comprehensive Serious Illness Cover (SIC).
    5. Estimates are based on the likelihood of making a claim before age 65.
  3. VitalityLife 2014 Healthcheck total figures
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