South African life insurers paid 99.3% of all claims against fully underwritten individual life policies in 2020 to a value of R20.6 billion.
The 2020 death claims statistics for fully underwritten individual life policies, released this week by the Association for Savings and Investment South Africa (Asisa), show that life insurers received 32 072 claims, of which 31 853 were paid. Only 219 claims were declined because of dishonesty, fraud or contractual exclusions.
Why claims were declined
Hennie de Villiers, the deputy chairperson of Asisa’s Life and Risk Board Committee, said despite receiving a higher number of claims in 2020 due to the pandemic, the number of claims declined was lower than in the previous year before Covid-19.
In 2019, life insurers declined 243 claims compared to the 219 claims declined in 2020.
He said most claims were rejected by life insurers because of non-disclosure of material information.
De Villiers said it is critically important for consumers to understand the potentially devastating financial consequences for their families of not honestly disclosing important information, such as any lifestyle or health-related detail that could materially affect the terms of the policy.
“If you are not sure whether information could be considered as material by the life insurer, rather disclose it,” he said.
“If you cannot remember the exact details of a medical event, disclose what you can remember together with the details of the relevant healthcare provider. The insurer can then obtain more detailed information if it is required.”
Dear Sir
What happens in the event of the deceased passing away due to Covid related illness – Hypoxia due to Covid and the insurer investigates rejects the claim due to material non disclosure?
Is there any recourse for the family as the death was not related for example to non disclosure of cancer or diabetes or mental illness?
Good day
The recourse for the family would be to take the matter to the Ombudsman for Long-term Insurance.