The ABI has published figures on the number of claims paid and declined in 2013 on insurance products that give customers - and their families – vital financial support to help them cope with the financial consequences of serious illness, injury and death.
This support removes the financial strains and worries that are so often a consequence of a life changing event – for example, because of inability to work - allowing individuals and their family to focus on coping with the other challenges involved.
These payments also help with the extra costs that often result from serious illness or injury – for example, hospital travel and parking, specialist equipment, care services, and reduced working hours for the ill person’s partner to enable them to provide care.
The ABI data shows that in 2013:
- £3.1 billion was paid in claims on these types of insurance to 99,000 customers or families; an average of £8.4m each day
- 97% of all claims were paid
Read more about the claims data published by the ABI.
Why has the ABI published this data?
We want to show that consumers can trust these types of insurance to help them when they need it – that claims will be paid – and to help more households understand the value of these types of insurance.
Why does this matter?
Many households have no real financial safety net. Each year one million workers suddenly find themselves unable to work for more than four weeks due to serious illness or injury; and around 250,000 people leave employment due to ill health.
Unrealistic expectations are common – about the likelihood of suffering a severe illness or injury – and about how much financial support the government will provide.
- 10.8 million households – more than 60% of working families - would see their income fall by more than one third if the main earner had to stop work due to ill health, and they have no insurance to give them a financial safety net if this happens.
- 6.6 million households would see their income fall by more than half without insurance to provide a safety net if this happens.
The amount of financial support households can get from the government varies enormously, and not just based on household income. Households with the following characteristics can expect little or no government support: no children; mortgage/home ownership (rather than renting); more than one source of household income (e.g. a second earner); those with savings.
Everyone who relies on income from employment needs to be made aware of how far their income will fall if they have to stop work. Anyone who would face a substantial drop in income if they rely on government income alone should be encouraged to use insurance to put in place a real financial safety net.
So by publishing this claims data the ABI is letting consumers know that they can trust insurance to give them the protection they need.
Helen White is Head of Protection, Association of British Insurers.