Insurers pay out a record £6.8 billion in protection claims

Insurers pay out a record £6.8 billion in protection claims
A record £6.8bn was paid out in life insurance, income protection and critical illness claims in 2021, with 98% of life claims settled by most of the major insurers.

This equates to £18.6 million a day, £1.6 million a day more than 2020’s previous record, according to data from the Association of British Insurers (ABI) and Group Risk Development.

Aviva alone paid out more than £1bn in life insurance, critical illness and income protection claims for the second consecutive year, equivalent to around £3m every day in 2021. In total, Aviva provided financial support for over 53,000 individual protection customers and their families.

Covid-19 was responsible for a significant proportion of payouts provided by insurers last year, with payouts related to the virus nearly doubling to £261m.

Roshani Hill, ABI Head of Protection and Health said: “Payouts for Covid-19 related claims almost doubling in 2021 is a stark reminder of the devastating impact the pandemic has had on society and people’s lives. Although nothing will ease the distress of loss, protection insurance is there to reduce some of the financial risks and stresses that can accompany these difficult and unpredictable events.”

“Living” benefits matter too

Life insurance and other types of protection aren’t just about giving you peace of mind that you’ll be financially supported should the worst happen.

Many policies offer other important benefits to help you and your family at any time. For example, services include enabling policyholders and their loved ones to receive counselling, request private prescriptions and physiotherapy.

Benefits can also provide policyholders with access to a second medical opinion, nutritional support, and GP Services. It is important to note that you don’t need to make a claim in order to access these free services and the benefits they offer, although in some cases insurers will offer benefits linked to a claim. For example, for every child’s critical illness claim Legal & General, after a conversation with their parents, will send a gift to the child to show them they are thinking of them through this challenging time in their lives.

In the event you do need to make a claim, insurers offer dedicated teams of trained claims handlers ready to take on your case and signpost any emotional and practical support that might be available. They will typically use digital claims management processes to ensure a speedy outcome and to keep customers informed of the progress of their claims.

Are you covered?

Insurers may have paid out billions in protection claims last year, but there are still countless people who aren’t covered and may be worried about how they and their families would cope financially if they were no longer around or unable to work.

If you don’t have cover in place, please get in touch today and see how we can help you find the protection you need. Our expert advisers can advise on the right solution for you for whatever budget you have. Some cover really is better than no cover and you never know when you might need it. Call 0800 073 1932 to find out more.

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