Shepherds Friendly paid out 95% of income protection (IP) claims received in 2021 and has paid an average of 95% of claims over the past five years.
The greatest number of claims it received were for musculoskeletal issues (43%), mental health (15%) and Covid-19 (14%).
Reasons for declined claims included non-disclosure and not meeting the terms and conditions of the plan.
Shepherds Friendly also paid out £12,000 on it’s additional death benefit that comes free to the policyholder as part of its enhanced IP benefits.
Ben Mason, protection manager at adviser LightBlue UK, said: “We’re pleased to see mutual insurers continuing to achieve high claims paid rates.
“It’s important that insurers keep this up because consumers think insurers pay out far less than they actually do.
“A few percent movement here and there isn’t the end of the world, the main thing is that insurers are still paying out way more than the public believes. For advisers, claims data can be used to prove to sceptical clients that these policies, especially the most important ones like income protection, actually do deliver on their promises.”
Ann-Marie O’Dea, chief executive officer at Shepherds Friendly, (pictured) added: “As a financial mutual that is built on fairness, everything we do is for our members, not shareholders.
“We are pleased again to report a high level of pay-out across a range of conditions on our income protection policies, demonstrating the valuable support we have given our members at the time they have needed it the most.”