Income protection rates rise on cards
White-collar disabilities related to lifestyle and stress are up markedly
Life insurers are likely to increase pricing and possibly change benefit designs on group-income protection policies following many claims in 2016, says Mark van der Watt, CEO of life insurance solutions at MMI. "A number of competitors have reported losses on their [group-income protection] benefits," Van der Watt said. Income protection provides policyholders with regular income if they are unable to work due to injury or illness. For the six months to December 2016, MMI’s corporate and public sector business posted a 29% decline in earnings to R280m, with disability experience alone contributing R64m to the drop. The deterioration in claims experience was mainly due to poor economic conditions, Van der Watt said. Another looming problem was the marked increase in "white-collar disabilities", which were related to lifestyle and stress. "Given that this group generally have higher salaries, this inevitably leads to an overall increase in the average payout per claim," he said. "The...
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