Disability claims hit assurers
The spike in payouts, especially for depression and back pain, is a feature of economic downturns, actuaries say
A spike in disability claims has hit the profits of all SA’s life assurers hard over the past year, with claims experience deteriorating across the industry because of the economic downturn and a change to tax rules. Lower back pain and psychiatric conditions such as depression top the list of disabling conditions, with an increasing number of employees claiming on corporate benefits policies that provide incomes for those too disabled to work. And the periods for which they are off work are growing longer. The life assurers’ results show their corporate businesses have been hit particularly hard, with MMI Holdings and Old Mutual, the biggest players in this sector, reporting sharp declines in earnings in their corporate portfolios. Sanlam, Liberty and Discovery reported similar trends. Alexander Forbes executive Michael Prinsloo said several insurers had indicated a deteriorating trend in the past year. Certain types of disability claims, such as for neurological or mental illness,...
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