The insurance industry has paid significant amounts in claims to clients since the start of Covid-19 and hard lockdown, which had a substantial impact on the country’s economy, with Liberty on Wednesday reporting a staggering R12.4 billion in payments.
According to Kresantha Pillay, head of lifestyle protector solution at Liberty Group, 2020 claim statistics showed a substantial increase in retrenchment and mortality, with payments made to retail, corporate, emerging consumer market, direct financial services and other businesses.
Pillay said Liberty had last year paid out R6.34 billion in claims to individual clients under the flagship lifestyle protector product and legacy risk products – an increase of 7.64% over 2019, and “broadly in line with average yearly increases over the past decade”.
Retrenchment claims peaked between last August and October on the back of a lag effect from the start of lockdown.
“During these three months, retrenchment claims peaked at over 60 per month, compared to just over 10 per month during January and February, showing the effects of the economic contraction at the start of the pandemic.
“This trend was expected, given the harsh realities and subsequent impact on jobs, because of the pandemic,” said Pillay.
“The most impacted provinces were the main economic hubs of Gauteng, Western Cape and KwaZulu-Natal. “Claim statistics last year reflect only the effects of the first wave of Covid-19 in the middle of the year,” said Pillay.