Individual income protection provider Cirencester Friendly has paid 94 per cent of claims in 2020, 15 per cent of which were for Covid-related conditions.
The pay-out rate means the provider has maintained its 10-year average of 94 per cent of claims paid.
During 2020, 1,434 claim applications were made, of which 98.3 per cent were eligible for consideration. This left 1,410 claims to be considered and of these, 94 per cent were paid.
Reasons for rejecting claims included the inability to either provide proof of earnings or medical evidence, no loss of earnings or for previously undisclosed pre-existing conditions.
The greatest number of claims in 2020 were for accident or injury, responsible for 29 per cent of claims, highlighting the value of insuring against the risk of less obvious causes of lost earnings.
The provider says 15.5 per cent of all claims paid were for Covid-19, resulting in the common infectious disease category increasing from 4.7 per cent to 19.5 per cent.
Some other claims listed included depression, cancer, heart, or circulatory complications as well as back, neck and shoulder problems.
More than £7.8m in benefit was paid out to members, including all income protection claims paid in 2020, as well as further benefit for the society’s enhancements range, My Extra Benefits and its value-added benefit, Children’s Critical Illness Support.
The provider encourages advisers to use the full claims data – both the headline figures and the information about why claims aren’t paid. The provider says this is essential, not just to highlight that the vast majority of claims are paid, but to ensure that consumers understand, in advance of taking the cover out, what they must do to ensure claims are successful and their contract meets with their expectations.
Cirencester Friendly chief executive Paul Hudson says: “The acid test for any income protection contract is will it pay out when the customer makes a claim? With an already proven track record in paying claims I am delighted that 2020 was no different and that we continued to support claimants in a variety of ways, including when they needed financial support.
“2020 has been a remarkable and unprecedented year. As a result of very careful business continuity planning and preparation we were able to continue operating without interruption and maintain great levels of service to our Members and supporters. A testament to the resilience, dedication and hard work by everyone at Cirencester Friendly”.