Tony van Niekerk, COVER in conversation with Daniel Stoch, Head of Research and Development at Discovery Life

In an industry where traditional financial planning often favours lump sum life and disability cover, income protection has long been treated as the overlooked sibling.

But as Daniel Stoch, Head of Research and Development at Discovery Life, clearly states, income protection is finally stepping into the spotlight, and with good reason.

“It’s arguably the most important insurance need, particularly at younger ages,” says Daniel. “When you consider the present value of future earnings, a 25-year-old earning R20,000 a month is looking at a future income stream close to R10 million. Protecting that should be a priority.”

Discovery life’s data underscores the urgency. In 2024 alone, the insurer paid out R670 million in income protection claims to over 2,100 clients. These figures illustrate the popularity and importance of this insurance benefit. With reserves of R3.4 billion set aside for future claims, the scale of protection becomes clear.  

The claims reality  - Claims trends reveal that income protection is not only a critical safeguard, but also one that is regularly needed across a broad range of body systems. Musculoskeletal conditions, neck, shoulder, and knee injuries are the leading cause of claims, particularly for temporary disability. “These claims often result from people being booked off work after injuries or surgeries that exceed the waiting period,” he explains.  

Mental and behavioural conditions account for 13% of female claims and 9% of male claims. While it might be assumed that older individuals would dominate the claims profile, Discovery’s data tells a different story:

• 40% of income protection claims come from clients aged 40 or younger

• Nearly 25% of these younger claims are for permanent disability

• These claims make up 67% of the total amount paid to them.

This data points to a sobering reality: permanent disability is not limited to later life. For those in the early stages of their careers, a sudden life-changing diagnosis or accident can halt decades of future earnings. The protection of that income stream is essential.

And this is where the value of a holistic approach becomes undeniable. “Your needs before and after a life-changing event are completely different,” says Daniel. “Income protection helps maintain your lifestyle by replacing your earnings, but severe illness or disability cover supports all the additional expenses, like modifying your home, hiring a caregiver, or accessing specialised treatment and/or devices.”

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