May 11, 2020

The protection industry pays out over £5.7bn in claims in 2019

The insurance industry paid out more than £5.7bn in protection claims in 2019. This was a marked increase of more than £470m compared to last year according to the Association of British Insurers ( ABI).

The percentage of claims paid in 2019 was 98.3%, the highest ever on record.

Life insurance

97.4% of life claims were paid in 2019. This equated to over £3bn in 2019, an increase of more than £19m compared to 2018.

The average individual life insurance claim paid was £77,535.28.

Critical illness

91.6% of critical illness claims were paid. This equated to £1.2 bn.

Cancer was the biggest single reason for individual critical illness claims.

The average individual claim paid was £67,573.2.

Income protection

The main cause of income protection pay-outs were musculoskeletal, followed by mental health and cancer.

£60.5m was paid out in individual income protection claims for mental health with an average claim of £15,728.

£15.8m in pay-outs were made per day last year – £1.3m per day more than in 2018. Non-disclosure was the main reason for claims being declined.

Figures for the whole protection market

Products Number of claims paid**Percentage of new claims paidTotal value paid (000s)** Average value of claims paid**
Critical Illness17,99591.6%£ 1,215,957£  67,573.28
Term Life39,63897.4%£ 3,073,382£ 77,535.28
Total Permanent Disability47471.7%£ 32,345£ 68,174.01
Whole of Life229,19799.99%£  794,106£  3,464.73
Income Protection16,591*87.2%£  669,397£ 17,728.80
All Protection Products303,89698.3%£ 5,785,187 

Financial support

The ABI’s assistant director, head of protection and health, Roshani Hill said: “The biggest ever pay-out in protection insurance shows how vital this cover is for people who need support at a difficult time. The high number of claims paid, should give people confidence that their insurance provider will be there when they need them, helping families get back on their feet and providing valuable safety nets when the worst happens.

“During uncertain times, when insurers are doing what they can to support individuals, families and the NHS,  having this confidence is more important than ever.” Cover magazine May 2020

For full information on protection claims paid in 2019 click below:

Association of British Insurers – Record 98.3% of protection claims paid out in 2019

If you are interested in arranging protection insurance it really can pay to take expert advice.

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Next steps

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