MoneyMarketing May 2017 | Page 26

26 RISK 31 May 2017

Cancer biggest cause of claims

In 2016, Liberty paid out R4.3 billion in valid claims, 13 % more than 2015, according to its latest claim statistics. This amounts to R17 million every working day.

These statistics reveal concerning trends in health and lifestyle risks with cancer and cardiac and cardiovascular conditions being the main causes.
“ Many people believe that misfortunes won’ t happen to them but when you consider
the statistics, the importance of insurance protection against debilitating events becomes quite clear,” says Henk Meintjes, Head of Risk Product Development at Liberty. The statistics are telling and highlight the importance of life protection insurance.
There are real people behind these numbers In 2016, Liberty developed segments to more accurately represent its customer-base. The segments include Young Achievers, Young Parents, Established Providers and Empty Nesters.“ Whether they are just starting out in their careers, celebrating their first born child, or planning for their retirement, it is our intention to develop solutions and services that allow our customers the flexibility and assurance to handle life’ s challenges,” explains Meintjes.
Cancer was the main cause for claims for all segments other than Empty Nesters. It stood at 15.2 %
of claims for Young Achievers, 24.4 % for Young Parents, 26.2 % for Established Providers and 23.31 % for Empty Nesters. The most common type of cancer for women was breast cancer and for men, it was prostate cancer.
Liberty’ s Chief Medical Officer, Dr Philippa Peil says:“ We have seen this trend ever since we started reporting on our claim statistics in 2006. There are a number of reasons such as lifestyle choices, our diets, lack of physical activity and genetic markers. Given the increasing rate of cancer claims, it is important for one to take serious care of one’ s body and to identify any serious illnesses as early as possible.
Dr Peil recommends that both men and women should take the time to familiarise themselves with their body.“ Check your skin for new moles, lumps or whatever doesn’ t feel or look right. With medical advancements, early detection can save lives,” she says.
She adds that cancer affects people of all ages.“ From age 30, females should take pap smear tests combined with an HPV test until age 65. Clinical breast exams should be done every three years, and annually after age 40. Men and women over the age of 50 should have colonoscopies every five to 10 years, among other tests.”
As a proportion of claims submitted, retrenchment was highest amongst Young Achievers at 11.7 % Cardiovascular was the second most common cause overall; 9.0 %
( Young Achievers), 14.72 %( Young Parents), 22.18 %( Established Providers) and 23.67 %( Empty Nesters) of paid claims respectively.
Strokes or central nervous system disorders also contributed significantly to total claims paid and were responsible for 9.31 % of Young Parents’ claims paid and 9.21 % of Established Providers’ claims paid. As expected for Empty Nesters, who are generally older, respiratory diseases and disorders were responsible for 7.31 % of paid claims.
Most motor vehicle accident claims were from Gauteng Although Liberty’ s Claim Statistics for 2016 reveal that the biggest cause for claims is health related conditions, many claims are also as a result of accidents. Looking at the data in more detail, motor vehicle accidents made up 10 % of claims for Young Achievers. At least 12 % of these were for young men and 8 % for young women.
“ Sadly for Young Achievers, 74 % of motor vehicle accidents which lead to long term insurance claims at Liberty were death claims. It’ s difficult to say from the data whether motor vehicle accidents are becoming more frequent or more severe. But the high paced lifestyle of major cities can lead to higher stress which impacts our health but could also lead to reduced focus on the roads,” Meintjes adds.

Momentum pays a total of 11 778 claims in 2016

Momentum says its 2016 claim statistics indicate a steady decline in claim pay-outs for critical illnesses in their most advanced stages and a corresponding increase, over time, for earlier stage pay-outs.
During 2014, the pay-outs for critical illnesses at the highest severity levels was 58 % of the total number of payouts and this declined to 43 % of the total critical illness pay-outs in 2016. However, over the same period, the pay-outs for critical illnesses at the lowest severities increased from 10 % to 37 % of the total number of pay-outs for critical illness claims.
George Kolbe, Head of Marketing for Life Insurance at Momentum says:“ Early detection of critical illnesses is extremely beneficial for clients because that is when illnesses have the best chance of successful treatment.”
Comprehensive critical illness cover is more affordable when selected on cover with tiered claim pay-outs. Being more affordable means that clients can select higher cover amounts without having to compromise on comprehensiveness of cover while still benefitting from increasing pay-outs if the critical illnesses progress. This highlights the importance of benefit design that provides for breadth of cover as a critical component of clients’ holistic financial wellbeing.
Comprehensive cover without compromise Kolbe adds:“ Traditionally, critical illness cover has focused on the four most common illnesses namely cancers, strokes, heart attacks and coronary artery bypass grafts( CABG). But other critical illnesses like dementia and Parkinson’ s disease can have the same financial impact on clients’ lives. Because of the comprehensiveness of Momentum Myriad’ s cover, we see more claims paid for events outside of the‘ big four’ claim events than some other insurers, who provide core critical illness benefits, as an option to their clients.”
Critical events are timeless Claim events do not discriminate
DIAGRAM 1: CHANGING PATTERN ON CRITICAL ILLNESS PAY-OUTS
against age. In fact, the majority of living benefit claims for 2016 was paid to clients between the ages of 40 and 49 years. Claims in this age group will cause a major disruption to retirement provisions if clients suffer a claim event without adequate risk cover in place.
Multiply clients’ financial wellness Kolbe points out:“ At Momentum we work hard to enhance the financial wellness of our clients. When it comes to claim statistics, this sentiment also rings true because the financial wellness effect on clients, who actively engage with Multiply, is noticeable as an increased average in life expectancy.
“ Whereas the average life expectancy for the insured population of SA is 67, the average life expectancy for Momentum Multiply members, on the higher status levels is 89 years; even longer than that of the Japanese population who, at 85 years has the longest average life expectancy in the world.”
He adds:“ Inactivity and obesity are two major contributors to lifestyle diseases. Wellness and reward programmes that encourage and rewards clients when they are physically active and adopt a healthy lifestyle can help reduce the risk of suffering a claim event significantly.”