Life insurers’ claim statistics for 2022 cast an ominous light on what is plaguing the nation, particularly South Africa’s younger citizens.
Last week, Momentum Retail Life Insurance reported an 11% increase in unnatural deaths – including motor vehicle accidents, murder, suicide, and surgery-related deaths – on the previous year’s claims.
In addition to a 72% rise in murder claims, deaths due to surgery increased by 63% and motor vehicle accident-related deaths were up by 17%.
Notably, among claimants under the age of 30 years, 67% of unnatural deaths were attributed to motor vehicle accidents. A shade less depressing, suicides decreased by 7%.
George Kolbe, the head of Momentum life insurance marketing, said the big increase in murder claims was concerning.
“This could be a symptom of the unacceptably high murder rates in South Africa, and while our numbers come off a relatively low base, the increase is significant. Combine this with the high motor vehicle accident-related deaths, and we see a great need for South Africans to become more vigilant and aware of their surroundings, for their own safety,” Kolbe sdaid.
In total, Momentum paid out R6.18 billion in claims. In terms of overall death claims, cardiovascular events topped the list accounting for 31% of claims, followed by cancer at 23%. Although showing a 31% decrease from the previous year, Covid-19 ranked as the third most common cause at 12%, followed by unnatural deaths at 11% and respiratory issues at 10%.
Critical sickness and sickness illness cover
Musculoskeletal claims also featured strongly across Momentum’s income protection, disability and critical illness claims. It was the most common cause for income protection claims at 24%, the second most common cause of lump-sum disability claims at 18% and fourth for critical illness accounting for 7% of all claims. These claims typically involved severe and chronic neck and back pain, typically resulting from accidents causing physical harm to the body.
For 70% of death claims caused by a critical illness, the insured lives had no critical illness cover in place with Momentum.
“If only they had critical illness cover in place, it could have benefited the claimants during their lifetime and may even have delayed or prevented their death because they could possibly have afforded superior care,” Kolbe said.
In a similar vein, Sanlam Risk and Savings’ 2022 claim statistics highlighted the importance of sickness illness cover, again, particularly for younger South Africans. Sanlam Risk and Savings paid out R6.38bn in claims in 2022.
Read: Sanlam notes uptick in sickness, disability claims among younger South Africans
According to product actuary Petrie Marx, Sanlam’s data showed that more than 70% of sickness income claims were from people younger than 45 years, and there was a 6% increase in disability income claims for those aged 26 to 35.
Focus on mental health
A 2022 paper by the Wits/Medical Research Council Developmental Pathways for Health Research Unit (DPHRU) found that while mental health in South Africa was at shocking levels, people were not seeking help.
The study, published in the journal Frontiers in Public Health, showed that more than a quarter of South Africans suffer from probable depression, with higher levels found in the Northern Cape, Eastern Cape, Western Cape, Gauteng, and Mpumalanga. However, only a quarter of those receive treatment.
“Our study shows that 25.7% of South Africans are probably depressed, with more than a quarter of respondents reporting moderate to severe symptoms of depression,” said Dr Ashleigh Craig, a researcher at the DPHRU.
Craig said mental illness significantly impaired overall health.
“Adult mental health services are urgently needed, especially for those identified as most vulnerable. Given the range of probable depression across the country, provincial-level plans and resources should also reflect the proportion of mental health problems,” Craig said.
As efforts to break down the stigma surrounding mental health continue, News24 reported that a history of mental health problems still caused many people to face insurance exclusions or higher premiums in the form of loadings ranging from 5% to 200% more than consumers without those issues.
Last week, Investec Life’s chief executive, Darren Behrendt, told News24 that, having identified mental health as something that the insurer needed to be aware of and adapt to, the five-year-old newcomer was in the process of exploring ways of underwriting mental health as it starts to look beyond its private banking client base for potential clients.
According to Sinenhlanhla Sithomo, the head of insurance business at Investec Life, Investec Life was talking to and forming partnerships with international players “who are working on advancing medical technology that could offer a more holistic way of assessing the risk of mental illness”.
If they get it right, this might just turn out to be an industry game-changer.
