Discovery Life payouts for 2023 shows more suicides

Discovery Life’s payouts for 2023 again shows an increase in suicides, especially under younger people, making up 28% of all unnatural deaths, up from 24% in the previous year. Unnatural deaths in the group younger than 30 made up 43% of the deaths in this group and 48% in the group between the ages of 31 and 40.

Death from car accidents stayed the same as the year before at 30%, while 23% were the result of other unnatural deaths, such as electrical shocks and drowning. Crime was responsible for 19% of unnatural deaths.

Discovery Life announced its claim payouts for 2023 this week and said its claims experience showed positive trends in earlier detection of severe illnesses, influenced by an increase in health screenings, as well as a significant decrease in Covid-19 claims.

The company paid R6.45 billion in claims for individual life policies which consisted of 8 912 unique claims, including R3 billion in death claims. R1.5 billion was paid through the severe illness benefit, R1 billion under the capital disability benefit, R613 million under the income continuation benefit and R298 million under various other benefits.

This brings the total value of claims paid under individual life policies to above R53 billion to date. Discovery Life also paid out R2.1 billion in shared-value benefits, rewarding clients for managing their health and finances well, bringing the total paid to clients in the year to over R10 billion.

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Fewer late-stage cancer claims as screenings pick up

“In the two years after the Covid-19 pandemic, we saw the impact of the sharp decline in health screenings translating into a spike in late-stage cancer diagnoses. As a group, we invested heavily post-pandemic in supporting a return to health screenings and the results are now evident in the 2023 data with a 29% increase in earlier stage cancer claims compared to 2022,” Gareth Friedlander, deputy CEO of Discovery Life, says.

“The importance of this is that earlier detection can lead to much better prognoses. 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 picked up earlier.”

He says it is also important that the total amounts Discovery Life paid through all living benefits are higher than what it paid towards mortality claims, which highlights the relevance of comprehensive and full body cover. 51% of the total claim amount paid in 2023 was paid under living benefits.

The industry pays about 22% on average in living benefits, while Discovery Life tends to pay a higher proportion for illness, disability and loss of income claims. Friedlander says this is because clients are rewarded with richer Shared-value benefits when they add more of these ancillary benefits which in turn also assists clients in reducing their disability and income insurance gap.

“Our 2023 claims experience shows that one in five life cover claimants had already claimed for a life changing illness or disability before they passed away.”

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Shared-value pay-outs increased

Discovery Life’s Shared-value payouts increased by 11% in 2023 to R2.1 billion, totalling R14.3 billion over 24 years, reflecting Discovery Life’s commitment to making people healthier, while enhancing and protecting their lives, Friedlander says.

“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 while they are comprehensively protected for bad times.”

Friedlander also points out that Discovery Life noticed that clients can be unaware that they have a valid claim or are not thinking of claiming while they go through life changing events. “One of our unique capabilities through our link with our health business allows us to identify possible claims for clients who are members of Discovery Health Medical Scheme which helps to accelerate the claims process for them.”

Prompted by medical diagnoses, Discovery Life kickstarts the claim process and proactively reaches out to clients for any supporting documentation, leading to the payment of claims earlier and more efficiently and in some cases, paying claims that may otherwise have gone unclaimed, he says.

“In 2023, we paid 99.2% of all claims, with less than 0.8% of claims repudiated. Approximately 0.5% of this was due to non-disclosure, 0.2% for misrepresentation and 0.1% for fraud.”

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Discovery Life payouts for education and people outside the country

Claims under Discovery Life’s Global Education Protector have been increasing steadily, with R69 million paid towards education costs in 2023, up almost 30% from the year before. Friedlander says this increase is due to a higher education inflation index coupled with an increase in the number of claimants.

“This shows the importance of having a product that indemnifies the cost of education while tracking education inflation, which is expected to be higher than consumer inflation each year.”

Discovery Life uses rich data to understand and develop products that address the emerging trends in consumers’ life insurance needs and this has led to increased global coverage in its product offering, including higher severe illness cover amounts to enable clients who might need treatment outside of South Africa.

The company’s offshore life insurance option, the Dollar Life Plan, has paid out over $28 million since 2017.  

“Global coverage has become increasingly important to clients as people are more mobile than they previously were, with families and businesses across continents.”