Scottish Widows paid out 98.99% of life claims in 2017

Michael Lloyd

May 18, 2018

Scottish Widows paid out 98.99% of life claims and 93.06% of critical illness claims in 2017, its protection claims statistics showed.

Both are above the industry averages for 2017 announced by the ABI, which were 98% for life and 92.2% for critical illness.

Scott Cadger, head of underwriting and claims strategy at Scottish Widows, said: “Our research shows that people, on average, believe that only 34% of protection claims are paid out by insurance companies.

“Our claims statistics for 2017, however, separate the facts from fiction. We must do more as an industry to dispel the myth that insurers will do anything to avoid paying a claim, and improve confidence among consumers that their policy will provide for them when it’s needed.

“Paying a claim is the core purpose of the product that we offer, providing a safety net if the worst happens, whether a bereavement or a critical illness.

“It’s where we fulfil on the customer promise made at purchase, and we have a very important part to play in supporting people through illness and bereavement and to help them at the most difficult and challenging times of their lives.”

A total of more than £204m was paid out by Scottish Widows in life and critical illness claims in 2017, an average of just under £4m per week.

The number of claims paid for life cover was 7,469 and for critical illness it was 1,769, equating to a total of 9,238 individuals and their families being helped to manage the financial and emotional impact of critical illness or death.

Since January 2000 Scottish Widows has paid a total of £2.5bn in claims to over 86,000 customers.

The total amount paid out in life claims was £129.4m with £13.46m paid in terminal illness claims and 55% of all claims from women were as a result of cancer, compared with 44% of men.

Heart related claims accounted for 20% of cases for men and 9% of cases for women.

The average policy duration at claim stage was 10 years and the average age of people who claimed was 58 years.

The average size of life claim paid was £41,392, and the highest individual claim was over £1m, while the youngest claimant was aged 20, and the eldest aged 89. Men accounted for 59% of claims.

Alan Knowles, managing director of Cura Financial Services, said: “Scottish Widows have shown that they are delivering excellent standard to their customers.

“They are delivering on their word to customers by paying the majority of the claims they see. Contrary to public belief, the majority of claims are paid out and Scottish Widows should be proud of how many families they helped during such challenging times.”

The total amount paid out in critical illness claims was £75.19m.

The four main reasons for women making a claim were cancer (74%, of which 52% were due to breast cancer), multiple sclerosis (6%), stroke (6%) and heart attack (3%).

Among men, 51% of claims made were for cancer, 19% for a heart attack and 8% for stroke and the average size of claim paid was £42,506 and the highest individual claim was £400,000.

The average period in force before a claim was 8 years and the average age of people who claimed was 51.

The youngest adult claimant was aged 21, and the eldest aged 79. The age of the youngest children’s claim was 8.2 months while women accounted for just over half (53%) of all claims.

Of the life claims made, 0.85% were declined due to misrepresentation and 0.16% due to the definition of terminal illness not being met.

Of the critical illness claims made, 4.6% were declined due to the definition not being met and 2.3% were due to misrepresentation.

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