Statistics on Claim Payouts

Something that’s front of mind for many people taking out insurance is, in the event of me making a claim, will my insurance company pay out? This can be the cause of much consternation for many people as through the years many of us have heard stories of people who for one reason or another made claims that were disqualified.

Let’s look at some of the real numbers from one of Australia’s leading insurance providers AIA Australia.

The source material comes directly from AIA and when I read through it what I really focused on was not just the amount of money they paid out but what sort of claims they paid out on.

For your benefit I was putting on my “I’m buying insurance hat” and although statistics don’t necessarily apply to everyone, it would make sense when taking out insurance to cover yourself for the most often claimed for circumstances.

First, so we know we’re looking at some meaningful data, how big is a company like AIA?

Well according to their data, in 2014, they paid out over $860 million in claims – or $3.4 million every working day. So I think that’s a reasonable sample to look at. These claims we’re broken down by:

  • Death $419,427,057
  • Total and Permanent Disablement (TPD) $218,214,987
  • Crisis Recovery $34,825,041
  • Income Protection (IP) $188,514,465
  • Other (including CCI & Whole of Life) $792,943
  • Total $861,774,492

Nothing too surprising to most of you there probably and if we looked closely at most aussie’s insurance portfolio’s I think their cover would reflect a similar weighting to these categories.

Now what medical conditions were the causes of these claims?

Well heart disease and cancer continue to be two of the leading causes of death in Australia1 and accounted for the

majority of Death and Crisis Recovery claims AIA paid out in 2014.

Cancer Snapshot 

  • An estimated 128,000 new cases of cancer will be diagnosed in Australia this year, with that number set to rise to 150,000 by 2020.
  • Cancer accounts for about 3 in 10 deaths in Australia.
  • The most common cancers in Australia (excluding non-melanoma skin cancer) are prostate, bowel, breast, melanoma and lung cancer.

To my mind it’s very relevant to look at what medical causes were behind the crisis recovery claims, because it’s in those situations where you’re going to be living with a condition and really need the financial support to get through it, and you’d want to make sure your current, or prospective policies cover you for the most common occurrences.

The key point I want to get across in this first article on claims is that you need to know the policy you have taken out cover you for the most often occurring incidents.  In future articles I’m going to be looking in more detail at different categories of cover but if you’re in the market for any form of cover contact one of our friendly Rate Detective consultants today to discuss any of the key issues raised here.

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Published on June 6-th, 2015 in Life Insurance
Damon Rasheed is the CEO of Rate Detective, an Australian financial service comparison sites specialising in Life Insurance, Income Protection Insurance and home loans. Damon holds a Master's Degree in Economics from the University of Melbourne and has been involved in many start-up internet businesses.

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