Life insurers paid out £90m during Covid-19 crisis

Equivalent of £980,000 a day

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ABI stats show that insurers paid £90m in claims to help families cope with Covid-19 deaths

During the height of the crisis, insurers received nearly 7,000 life insurance claims and paid £90m - the equivalent of £980,000 a day - to support families of people who passed away due to coronavirus, stats from the Association of British Insurers (ABI) have revealed.

The figures show that between 1 March and 31 May this year, 6,689 claims were received under individual protection policies, with 351 claims under group schemes (also including a small number of critical illness and total permanent disability claims). On average, 77 claims were paid each day.

The vast majority of these claims (83%) have been paid so far and every life insurance claim has been accepted. The average pay-out on term insurance is expected to be £63,000, with an average pay out of £137,000 on group policies.

Find out more about the impact of Covid-19 on protection claims at the COVER Claims & Underwriting Forum on 22 September

Roshani Hill, ABI's assistant director, head of protection and health, said: "Every Covid-19 death is a tragedy. While no amount of money can ever replace a life, insurers have been doing all that they can to help families cope financially through these unprecedented and distressing times.

Roshani Hill, head of protection and health, ABI

"We know that coronavirus has long lasting impacts, and protection insurers will continue to support families hit by this tragedy. No one knows what is round the corner, which is why protecting yourself and your family against the worst is vitally important."

Covid-19 Support Fund

The insurance and long-term savings industry also has launched a Covid-19 support fund to provide relief to charities and community initiatives affected by the coronavirus pandemic.

The Covid-19 support fund aims to raise £100m, with £82.5m already having been pledged.

The fund will comprise voluntary contributions from firms across the sector, with the likes of Aviva, Zurich and AIG donating so far. It is in partnership with the Charities Aid Foundation, and a network of partners, including the National Emergencies Trust.

It will aim to support community-based charities that are under unprecedented strain; charities supporting the most vulnerable - in particular, families and children living in greatest poverty and older people in isolation - and initiatives to promote wellbeing and mental health across society

The fund is supported by members of the ABI (Association of British Insurers), The British Insurance Brokers' Association (BIBA), Lloyd's, and The London Market Group (LMG).