Old Mutual pays out R11 Billion in claims in 2019
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<p><strong>By: Old Mutual</strong></p>
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<h2>99% pay-out ratio for the fourth consecutive year</h2>
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<p><strong><em>The proportion of heart attack claims have increased by 113% since 2016, moving heart attacks from being the least claimed ‘big 4’ illness to the 2nd most claimed.</em></strong></p>
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<p>Old Mutual today announced that it paid R11.3 billion in personal cover claims in 2019, totalling R45 million for every working day during that year. The pay-outs include underwritten, non-underwritten and corporate claims.</p>
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<p>Releasing its claims statistics for 2019, the group said it is proud to maintain an impressive total pay-out ratio of 97%, the same as the previous year.</p>
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<p>“The Covid-19 pandemic has shown us how unpredictable life is, and why it is important to have adequate cover that protects individuals and loved ones from sudden and life-changing events, whether death, disability, illness or retrenchment,” said John Kotze, Protection Product Head at Old Mutual.</p>
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<p>Old Mutual’s claims statistics report for 2019 unpacks their <strong>underwritten claims</strong>, which amount to R5.33 billion of the overall amount paid. It consists of the following:</p>
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<ul><li>R4.02 billion in <strong>Death cover</strong> claims</li><li>R739 million in <strong>Severe Illness and Physical Impairment</strong> cover claims</li><li>R561 million in <strong>Disability cover</strong> claims</li><li>R10 million in <strong>Retrenchment cover</strong> claims</li></ul>
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<figure class="wp-block-image size-large"><img src="https://cover.co.za/wp-content/uploads/2020/07/3-4.jpg" alt="" class="wp-image-143457"/></figure>
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<p><strong>Causes of claims</strong></p>
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<p>Cancer & tumours (23%), cardiovascular disorders (23%) and accidental death (22%) are the three main causes of death for <strong>Death cover claims</strong> paid. </p>
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<p>Cancer and tumours (48%) and cardiovascular disorders (28%) also showed up top of the list of <strong>Severe Illness claims</strong> paid for the fourth year in a row, now followed by central nervous system disorder claims at 12%.</p>
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<p>Kotze explains that the ‘Big 4’ illnesses made up 73% of all <strong>Severe Illness claims</strong>, with 67% of them attributed to cancer, 17% to heart attacks, 9% to strokes and 7% to coronary artery bypass grafts.</p>
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<p>“Alarmingly, the proportion of heart attack claims have increased by 113% since 2016, moving heart attacks from being the least claimed for ‘Big 4’ illness to the second most claimed for,” says Kotze.</p>
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<p>“In the <strong>Severe Illness cover</strong> category males claimed mostly for cardiovascular disorders (42%) and females for cancer and tumours (60%) with breast cancer being the most common,” he says.</p>
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<p>In the <strong>Disability cover category</strong>:</p>
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<ul><li>Old Mutual paid out 11% of Disability Income cover claims towards psychiatric disorders; this is a significant 59% increase since 2016.</li><li>Under their Disability Lump Sum cover, which applies to conditions that are permanent and irreversible, the company paid out 9% in psychiatric disorder claims, making it the fourth most claimed for condition.</li><li>83% of all psychiatric disorder claims occur in the age bands 30 to 50, and the majority are working adults in their prime.</li></ul>
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<p>“The increase in claims for psychiatric disorders was already emerging pre-Covid-19, and so it is very likely that mental health conditions may increase even more due to the widely reported Covid-19-related stresses. This highlights the importance of having the right cover in place, understanding how your cover works and disclosing all the information you need to, in order to have a successful claim,” explained Kotze.</p>
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<p>Only 3% of <strong>underwritten claims</strong> that were correctly submitted did not qualify for a pay-out.</p>
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<ul><li>66% of these did not meet the benefit definition, meaning that the condition they claimed for was not as described in their contract</li><li>18% were due to the customer not disclosing important information</li><li>The remainder were due to suicide exclusion (6%), fraud (5%), an underwriting exclusion (3%) and a general exclusion (2%)</li></ul>
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<p>“Understanding your cover and providing full disclosure remains key,” concludes Kotze.</p>
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