Legal & General has paid out a record 43 personal protection claims every day in the UK during 2020, making payouts to 15,855 customers and their families. Pay outs totalled £763.9m – up £32m from 2019.
The firm paid out 216 income protection claims in 2020, up 39% on 2019. At a monthly average of £872 per claim, this equates to a total of £2.2m. The main cause of IP claims was musculoskeletal disorders (32%), followed by cancer (17%) and 12% of income protection claims were for mental health – one and a half times higher than in 2019.
The year’s claims data was heavily affected by the pandemic with one in ten death claims Covid-19 related. Legal & General paid out 99% of the 1,214 Covid-19 death claims at an average of £32,287 per claim and a combined total of more than £39m.
While overall, 60% of Legal & General Life Insurance claims are for men, this increased to 70% for Covid-19 related deaths reflecting official figures indicating men are more likely to die from Covid-19 than women.
The figures also suggest other protection claims have been affected by the pandemic – there was a 2% drop in cancer critical illness claims, and 155 fewer Terminal Illness (TIC) claims. The vast majority (94%) of TICs were due to a cancer diagnosis, unchanged from last year, however, due to the fact there were fewer overall TICs in 2020, the total number of cancer related claims fell from more than 1,000 in 2019 to 856 in 2020.
Commenting on the findings, David Banks, director of claims and underwriting, said: “The pandemic has put the NHS under huge pressure, reportedly causing significant, but understandable, delays in the treatment and diagnoses of cancer. Despite the best efforts of GPs and NHS staff who have worked hard throughout these unprecedented times, it’s likely claims will rise as many of these cases become more advanced. We also expect a rise in claims for long-Covid, for which we have our long-Covid support programme, while there’s also potential concerns surrounding the longer-term impacts of the crisis on people’s mental health. It’s vitally important that customers continue to use the NHS as well as the support they have via their cover to ensure they get the appropriate help and treatment they need, helping to lessen any long-term impacts.
“If 2020 has taught us anything it is that protection has never been more important. One in 10 of all death claims were paid out because of Covid-19, something that wasn’t even on our radar 18 months ago, which further emphasises the benefits of insurance.
“It also reiterates the importance of seeking help; early intervention is key, which is why our IP protection includes help and support for customers to access as soon as they’re ill, because the sooner we know, the sooner we can help prevent their health problem from progressing.”