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An unhealthy lifestyle, irresponsible behaviour, the high incidence of violent crime and lingering Covid-19 cases contribute to SA’s high death rate, according to recent statistics published by the large life insurance groups.
The four big life insurers paid out a total of more than R20 billion in life insurance claims in 2023.
The most recent claims figures from Old Mutual, Sanlam, Discovery Life and Momentum disclose a few trends and hint that there is truth in stories that men live dangerously – with the insurers specifically mentioning that claims related to younger policyholders have increased.
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What the statistics revealed:
Old Mutual said it paid out R5.6 billion in death claims during 2023.
“Trauma, the largest contributor, made up 30% of all death claims, including shooting accidents, crime and violence and motor vehicle accidents, with the latter accounting for 43% of trauma claims,” says John Kotze, head of product at Old Mutual.
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He notes that 6% of the death claims were due to suicide.
“It is devastating that so many people see suicide as the only option and we encourage people to ask for help,” says Kotze.
“Unfortunately, many trauma claims are a consequence of the current South African environment in which people find themselves. We are positive, along with the rest of the market, that the new government will make inroads into key issues such as poverty and the need for jobs, which we believe will help reduce the level of crime,” he says.
Illness claims amounted to R926 million, 45% of which were due to cancer and tumours.
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Disability claims were valued at R477 million, mostly due to muscular-skeletal disorders.
Old Mutual paid R108 million in terminal illness claims to customers so they could make the most of their last moments with their loved ones.
Dr Bielqees Salie, senior medical officer at Old Mutual, says that 71% of the total illness claims were due to cancer, heart attacks, strokes and coronary artery bypass grafts.
“This alarming statistic underscores the impact of non-communicable diseases driven by lifestyle factors. The prevalence of the Big 4 conditions highlights how modern lifestyles contribute to severe health issues,” she says, noting that “poor nutrition, inactivity, poor sleep and mental health neglect are major risk factors”.
“Overeating and unhealthy foods lead to obesity, a precursor to many non-communicable diseases, and physical inactivity impairs cardiovascular and metabolic health,” she adds.
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“Sleep and mental health are often neglected too. Poor sleep quality is linked to an increased risk of heart disease and stroke, while chronic stress and poor mental health contribute to depression and anxiety, raising the risk of severe illnesses.”
Although there are many genetic factors at play, Salie notes that lifestyle changes can mitigate many risks, especially among younger customers, who are exhibiting a concerning trend in terms of severe illnesses.
Sanlam paid out approximately R5.1 billion in death claims in 2023, and highlights a concerning trend in its sickness and disability income claims in that 67% of all these claims were paid to clients under the age of 45.
“Young people, especially, often think they are invincible, but our statistics show a significant number of claims come from clients under 45,” says Dr Marion Morkel, Sanlam’s chief medical officer.
“It’s crucial for younger individuals to have appropriate cover, such as income protection and severe illness insurance, to safeguard their financial futures.”
In total, 62% of disability claims came from people younger than 55, in their prime working years. It was even higher for female policyholders, at 70%.
Two thirds of sickness-related and disability income claims came from individuals younger than 45.
According to Morkel, the biggest claim events among younger clients are for cancer, cardiovascular disease, and trauma and injury.
Sanlam notes that the Big Four diseases were behind most of the claims, whether due to death or disability.
“Across all Sanlam benefits, cardiovascular incidents were the biggest cause of claims at 18%, followed by cancer at 15%, respiratory illnesses at 12% and accidents, violence and injury at 12%,” says Morkel.
“These four accounted for 57% of all claims paid.”
Sanlam flagged the rise in cardiovascular diseases for the last 20 years. Morkel says this is clearly linked to lifestyle diseases and was magnified by the extra mortality burden of the pandemic.
“We continue to fail to address the key causes of diseases of lifestyle. Sadly, we’re likely to see cardiovascular incidents exponentially increase in the future. Obesity remains a major challenge in our country, with Type II diabetes linked to this.”
Discovery Life noted a positive trend in its 2023 report on life insurance claims in that policyholders detected severe illnesses earlier than usual, due to an increase in medical testing.
In 2023, it paid claims to the value of R8.4 billion across both Group Risk and Individual Life policies, of which R6.5 billion were for claims against individual life policies. Death claims amounted to R3 billion.
Gareth Friedlander, Discovery Life deputy CEO, says Discovery invested heavily in supporting an increase in medical screenings after it saw the impact of a sharp decline in health screenings translating into a spike in late-stage cancer diagnoses.
“The results are evident in the 2023 data with a 29% increase in earlier stage cancer claims compared to 2022.
“The importance of this is that earlier detection can lead to much better prognoses,” he says.
“Later-stage cancers are still significantly high, at 31% of all cancer claims. But as a proportion of all cancer claims, less severe claims have increased – showing that these are being picked up earlier.
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“It’s also worth highlighting that the total amounts we paid through all living benefits are higher than what we paid towards mortality claims, which highlights the relevance of comprehensive and full body cover,” says Friedlander.
He notes that Discovery’s focus on motivating its policyholders to live healthier is paying dividends.
“Discovery Life’s Shared-value payments are now growing faster than the claims pay-outs. This is a paradigm shift from the traditional insurance model as clients are deriving significant value from their life policies through healthy behaviour whilst being comprehensively protected for bad times,” he says.
“The rich incentives provided through the Shared-value model motivate clients to engage in healthy behaviours. Discovery Life clients who engage in the Vitality programme experience reduced mortality rates.”
The claim statistics from Momentum Life illustrate the difference in the causes of death between males and females. The majority of claims were for cardiovascular causes for both men (31%) and women (30%).
More death claims for cancer were received from women (30% of all claims) than from men (24%).
For women, the next biggest cause for claims were as a result of respiratory diseases at 12%, but for men it was death due to unnatural causes, totalling 17% of death claims among men.
Only 6% of all death claims from female policyholders were as a result of unnatural deaths.
George Kolbe, head of life insurance marketing at Momentum Life, said during a presentation of the group’s claims statistics that Momentum paid R6.3 billion worth of claims in 2023, an increase of 5.5% compared to 2022.
Overall, the largest cause of death claims was cardiovascular diseases and cancer in what Kolbe described as a return to normal.
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“There was nothing out of the ordinary and nothing unexpected. There were no natural disasters or pandemics,” he says.
This resulted in a return to obvious trends, such as a higher number of claims from older clients, with Kolbe noting that 60% of death claims were from clients older than 60 years.
Momentum disclosed that the oldest mortality claim was after a 91-year-old policyholder suffered a heart attack.
A heart attack was also the cause of death of the youngest client, a 21-year-old male.
This article was republished from Moneyweb. Read the original here
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