I am a group risk consultant. GRID has published industry claim statistics that show the types and amounts of claim, as well as showing group risk claim payout rates for the first time. Can I use these with my corporate clients? If so, how, and what kind of queries can I expect off the back of them?
Katharine Moxham, GRID
We've pre-empted queries by publishing our claims statistics on the group risk market. No one has asked for this information, whether it's been an intermediary, insurer or regulatory body.
We published it in the true spirit of transparency. I think there's a clear trend in the individual market towards looking at the figures in this way, and we have published our statistics in advance of such demand.
If I were an intermediary looking to use these statistics with clients, I would perhaps focus on the cause of claim. I would look at what we've paid out in terms of the highest being cancer and the second highest being heart attacks.
There is no change at all compared with last year on that. I would bring home the value of cancer cover and looking at it as a way of supplementing cancer cover under private medical insurance.
This is a big thing for PMI schemes with the cost of cancer drugs, and you could use critical illness to supplement in terms of providing greater access to that sort of cover.
This is the first time that cancer has been the main cause of claim under all three benefits - group income protection, group CI and group life cover. In the past typically it has been mental illness and musculoskeletal claims under group IP, so this is the first time we have seen cancer as the major cause of claim under group IP. It really brings home what a major cause of claim cancer is.
David Williams, Friends Life
This is the first time GRID has published approved claim payout rates and the first time Friends Life has published our approved claim statistics. As a provider, we aren't often asked by employee benefit consultants for our claims statistics. We talk to them about case studies and the value it brings.
They don't ask us to tell them how many claims we approve and or don't approve. It hasn't been a compelling force pushing us to publish these statistics - we wanted to be transparent, but there hasn't been anyone up in arms saying that we're hiding behind data and that they want to know what's going on.
What's important when you look at the claims statistics is that group life claims are very strong and positive. With group income protection, the value we bring is working with the employer and collaborating with them early on with rehabilitation.
If you can't rehabilitate people, you head to the claim approval process. That's when we get to reasons why a claim may not be paid. As a consultant, I think it's good to know an insurer's claim-paid philosophy and where it stands.
The key point is around communication and making sure people are clear. If this encourages more communication around what's being covered and what's not being covered, then this is really helpful. This is particularly important for critical illness in flex schemes in communicating pre-existing condition exclusions.
Elliott Silk, English Mutual
I think it's a good thing the statistics have been published. We do have clients, particularly when we're talking to those implementing new schemes, to whom we need to explain how the group protection will be valid and valuable.
They want that reassurance and peace of mind that, should something happen to an employee, there's not going to be a dispute about the claim and it will be paid. The group life statistics are relevant but less so, because one would expect those to be clear cut, as someone is either alive or dead, so you would expect those payouts to be high.
Bearing in mind that with group life there is no medical disclosure unless someone exceeds the automatic acceptance limit, you would not get claims rejected for non-disclosure.
With group income protection and critical illness, the percentages are high in terms of the payouts. I'm not sure of the reasons for those that were declined - they were probably not justifiable.
Most CI schemes exclude pre-existing conditions so I would guess the declined claims were due to claims lodged with pre-existing conditions. It gives reassurance to an employer if it's something they're promoting, as the last thing they want is a dispute and a disenchanted employee.
Something originally put in place to motivate an employee can quickly turn around. If something were to happen, word could spread around the workforce quickly and employees would question the value of the benefit and cause more work for the employer.
