June 18, 2019

Royal London – How many claims were paid out in 2018?

Royal London has revealed its 2018 claims figures, stating nearly £174m was paid in life and terminal illness claims. This accounted for 95.2% of term life insurance claims paid, where the average life claim paid was £103,000.

Life claims

  • Terminal illness claims had an average payout of more than £156,000 with 89.4% of claims being paid
  • Over £132m was paid in whole of life claims with 99.9% of the claims being paid
  • The average payout for whole of life cover was more than £3,800.

Critical illness claims

  • £190m was paid in critical illness (CI) claims
  • The average payout being almost £99,000
  • 91.2% of CI claims were paid out
  • 2.9% of claims were declined due to misrepresentation with 5.9%% of claims not meeting the plan definition
  • The average age of a CI claimant (excluding children) was 50 years old
  • The average age of a children’s CI claimant was just seven years old

The most common reasons for a CI claim were:

  • Cancer (64%)
  • Heart attack (11%)
  • Stroke (8%)
  • Multiple sclerosis (4%)
  • Children’s CI (4%) where cancer accounted for more than half of the children’s CI claims (56%)

Income protection claims

  • £930,544 was paid in income protection (IP) claims
  • 72.2% of claims being paid in 2018
  • An average payout of more than £5,900
  • An additional £29,000 was paid out on fracture cover claims
  • The average age of an IP claimant was 43 years old
  • 13.9% claims were declined were due to misrepresentation and 13.9% did not meet the plan definition

The most common reasons for IP claims:

  • Musculoskeletal (34%)
  • Cancer (20%)
  • Mental health (13%)

Financial support

Craig Paterson, underwriting and claims philosophy manager at Royal London, said the insurer has sped up its claims process and reduced the need for paper forms, meaning that for many claims it can take digital consent from customers to get the medical evidence it needs.

“With cancer being the single biggest critical illness risk we all face, it’s important to have comprehensive critical illness, which is why we enhanced our product and introduced four additional cover conditions for early forms of cancer,” he added.

Source: Health insurance and protection daily June 2019

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

Click here to read more about the insurance industry paying out more than £5.3bn in protection claims in 2018.  This link goes off-site to the Association of British Insurers and Group Risk Development.

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