Critical Illness Payout Rates Increased in 2012
According to statistics published by the Association of British Insurers, there has been a significant increase in the amount of successful critical illness claims being processed.
In 2012 overall, an increase in payouts and minimal rejection rates compared to a couple of years ago has created a positive reflection on specialist insurance companies, causing more individuals to take out protective plans. Critical illness payout rates have now exceeded 90%.
Specialist insurers that have released their statistics on critical illness payouts are as follows:
Aviva is the latest specialist insurer to reveal their critical illness payout rates from 2012. The report reveals that 92.5% of the critical illness claims they received in 2012 were successful.
With a minimal rejection rate of 1.7%, Aviva has the lowest rejection rate to date.
Families protected by Aviva in 2012 were reported to receive more than £475m through protection policies in 2012. More than £131m was paid to customers with critical illness cover, an increase of £17m year-on-year.
The report shows that cancer is still the main cause of critical illness claims (66%), which is closely followed by heart attacks (12%), strokes (7%), multiple sclerosis (5%) and benign brain tumour (3%).
According to Aviva, these conditions have remained in the top 5 causes of critical illness cover for over 5 years, accounting for 92% of Aviva’s overall critical illness payouts.
Earlier this year, specialist insurer Bright Grey, revealed that they paid out 93% of the critical illness claims they received in 2012.
The report revealed that just 4% of the claims received were declined for non-disclosure, while the average payout for successful claims came out at £73,000. Of the successful critical illness claims, almost two thirds were for cancer, followed by heart attacks at 14% and multiple sclerosis at 8%.
Specialist insurer Zurich also revealed positive statistics for critical illness payouts for 2012, although down slightly on 2011.
The report revealed that Zurich paid out 90% of critical illness claims in 2012, just 2% less than 2011. The insurer is estimated to have paid a total of £59.9m in critical illness claims in 2012, declining only 8% of the claims, due to definition not being met. A further 1.8% of the claims were declined for non-disclosure.
In 2011, Zurich paid a total of £64.5m in critical illness claims.
The slight fluctuation in the proportion of successful annual claims being paid was said to be expected, says a spokesperson from Zurich.
Of the critical illness claims received, a large proportion of payments were for heart attacks, strokes and multiple sclerosis. Payouts for heart attacks jumped from 9.1% in 2011 to 13% in 2012.
The Association of British Insurers are said to be pleased with the news, wishing to work more closely with specialist insurers to establish better results in the future.
As a result of these positive statistics, individuals can now be ensured that critical illness policies are valid, indicating that insurers do want to pay out for critical illness claims. Specialist insurers will continue to work hard to increase the amount of successful critical illness claims, with the help of the ABI.
If you are looking for Critical Illness life insurance, give Your Life Protected a call today.