Record figures released by Association of British Insurers (ABI) and Group Risk Development (GRiD)
The insurance industry paid out more than £5.7bn in protection claims in 2019 - a year on year increase of more than £470m - the yearly figures shows.
The percentage of claims paid has risen to 98.3% - up from 97.6% last year - the highest ever on record.
Over £3bn in life insurance claims were paid in 2019 - up by more than £19m year on year.
Cancer was the biggest single reason for individual critical illness claims; musculoskeletal was the main cause for income protection pay-outs, followed by mental health and cancer.
The ABI and GRiD data also revealed that £60.5m was paid out in individual income protection claims for mental health with an average claim of £15,728.
Group risk industry pays out £1.76bn for 2019 claims
Pay-outs equalled £15.8m paid a day last year - £1.3m a day more than in 2018 - and non-disclosure was the top reason for declined claims.
The ABI's assistant director, head of protection and health, Roshani Hill said: "The biggest ever pay out in protection insurance shows how vital this cover is for people who need support at a difficult time. The high number of claims paid should give people confidence they can trust that their insurance provider will be there when they need them, helping families get back on their feet and providing valuable safety nets when the worst happens.
"During uncertain times, when insurers are doing what they can to support individuals, families and the NHS, being able to have this confidence is more important than ever."
Figures for the whole protection market (individual and group):***
|
Products |
Number of claims paid** |
Percentage of new claims paid |
Total value paid (000s)** |
Average value of claims paid** |
|
Critical Illness |
17,995 |
91.6% |
£ 1,215,957 |
£ 67,573.28 |
|
Term Life |
39,638 |
97.4% |
£ 3,073,382 |
£ 77,535.28 |
|
Total Permanent Disability |
474 |
71.7% |
£ 32,345 |
£ 68,174.01 |
|
Whole of Life |
229,197 |
99.99% |
£ 794,106 |
£ 3,464.73 |
|
Income Protection |
16,591* |
87.2% |
£ 669,397 |
£ 17,728.80 |
|
All Protection Products |
303,896 |
98.3% |
5,785,187 |
|
*Includes figures from the Association of Financial Mutuals
**Figures are for new claims, as well as income protection claims in payment
***2019 saw a steep increase in the number of new claims paid, as well as some significant changes to average claim amounts. It should be noted that these changes are partly due to a reporting change, and comparisons of these figures to those reported in previous years should be made with caution
