In Focus: Vulnerability  

Q&A: How to support policyholders post-Covid

Q&A: How to support policyholders post-Covid

Covid-19 has shone a spotlight on the practices of insurers and underwriters over the past 12 months.

The focus has perhaps been on the test case brought by the Financial Conduct Authority over business interruption insurance, and the subsequent challenges over 2020.

But there has also been a positive move towards healthcare protection products, with advisers citing a rise in inquiries in the first half of 2020 over life insurance, critical illness and income protection policies.

The pandemic has provided the impetus for people to consider their protection needs, but how can insurance companies and brokers continue to support these people in 2021 and beyond? 

Here to talk with FTAdviser In Focus is Peter Hamilton, head of market engagement for Zurich. 

FTAdviser: Are there any early indications of trends across the industry in terms of claims since the Covid-19 pandemic struck the UK?

Mr Hamilton: What we have seen, reflecting the broader reality and tragedy of the pandemic, is a huge number of death claims.

Last August, Zurich announced it had paid £15m in H1 last year alone. This is not surprising, considering the overall death rate in the UK has been going up so the life insurance claims reflect that, but it is why we are in business.

There will also be echoes of what we are seeing in the wider population. Covid will sadly have accelerated the deaths of many people with existing serious illnesses but here are a lot of extra deaths we have paid this year because of Covid. 

But in terms of CI cover, it is slightly different. The first quarter of last year was similar to the normal pattern, but from the second quarter onwards we saw a reduction in CI claims than we might normally have over the rest of the year.

FTA: Is the lower CI claim trend worrying, in that customers might not be getting the treatment they need?

PH: I’d expect to see some additional CI claims that haven’t been picked up this year because important consultations and diagnoses have been delayed, either because customers couldn’t access the right services or Covid-related fears inhibited them from seeking medical help.

In every interaction we might have with customers and advisers, we will remind them where possible to seek medical treatment, although there are inevitably limits to how far we can do that.

But we can see statistically that certain treatments and diagnoses - such as for cancer - have been put back during the pandemic. There has been a huge reduction in cancer diagnoses and treatments.

Typically, cancer would be the highest reason for claiming against a CI policy, so we think there will be a catch up over the coming months as people start to get the diagnoses and start to get treated.

FTA: What about the mental health of the nation? Has Zurich seen any trends relating to mental ill-health?