More than £4.5m paid out due to Covid-19 so far and more than £10m more expected in coming weeks
Zurich UK paid out over £154.2m in life insurance claims during first half of 2020 - this is £14.2m more than the same period last year.
Financial support through life, critical illness and income protection policies has been paid to more than 3,200 customers by the insurer so far this year.
Claims already paid for Covid-19 account for around a third of the increase in life insurance payments made, however the insurer said it expects over £10m to be paid to customers due to the pandemic over the coming weeks.
For life insurance, more than 2,100 claims were received during H1, with settlements worth over £108m. This compares to 1,980 claims over the same period last year valued at £97.2m.
Over 99% were paid with just 1% declined where customers had not shared important medical information when they applied for cover, such as a history of excessive alcohol consumption, Zurich said.
For critical illness cover, £42.4m was paid out to 561 customers (up from 570 last year). However new claims in June were lower by around a third on the same period last year, perhaps as a result of customers being unable to access medical advice and treatment.
Critical illness payments include £575k awarded in claims for children where the main cause of claims was leukaemia. Over £150k was settled for customers with an ‘additional payments' policy benefit. Payments increased by over £65k on the same period last year, with all claimants female. Causes of claims included mastectomy for breast cancer and brain aneurysm.
The main causes of critical illness claims are still cancer accounting for 62%, heart attack (9%), stroke (4%) and multiple sclerosis (3%), with breast cancer alone accounting for nearly one in five (19%).
The percentage of claims paid were 86% with 7% declined for misrepresentation. Another 7% were declined as the definition/severity of the illness set out in their policy was not met.
All new claims from customers with income protection cover were paid, with around 367 claims in payment each month valued at £3.3m, said Zurich, which compares to £3.7m paid last out year when 85% of new claims were accepted.
The main causes of claims were musculoskeletal disorders for 29% of claimants, followed by mental illness (including anxiety, stress and depression) and cancers which both triggered more than one in five claims (21%).
For fracture cover, over £456K was paid out to customers with the ‘multiple fracture cover' add-on.
Peter Hamilton, Zurich's head of retail protection said: "Our claims data shows that we have seen a marked increase in the numbers of customers and their families needing to claim on their life insurance policies, with this jump driven in part by the Covid pandemic. This is exactly why we're in business - to help customers and their families at the most difficult times in their lives. At the same time, we've seen fewer critical illness claims towards the end of the first half of this year - so we urge customers to seek medical advice to ensure they are accessing any treatment they may need."
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