Royal London – How many claims were paid out in 2019?

Royal London has revealed its 2019 claims figures, stating nearly £575m was paid in protection claims. The insurer paid 99.7% of claims to nearly 120,000 customers.

Life claims

Royal London paid nearly £145m in life and terminal illness claims last year.

  • 1,300 term life insurance claims were paid
  • The average pay-out was £80,000 per claim
  • The average pay-out for a terminal illness claim was £139,000
  • £269m was paid in whole of life (WOL) claims
  • The average pay-out for whole of life was £2,300
  • 115,361 WOL claims paid in total

Critical illness (CI) claims

  • Royal London paid on average nearly £74,000 per claim
  • More than £150m paid out in total
  • 93% of CI claims paid
  • The average age of a CI claimant (excluding children) was 50 years old

The most common reasons for a CI claim in 2019:

  • Cancer (65%)
  • Heart attack (10%)
  • Stroke (6%)
  • Children’s CI (5%)
  • Multiple sclerosis (3%)

Of the children’s CI claims paid:

  • 53% were for cancer
  • 15% for open-heart surgery
  • The average age of a children’s CI claimant was eight years old

Following changes made in recent years, the insurer paid out claims for three pregnancy-related complications and, tragically, the deaths of five children.

Income protection (IP) claims

  • £3.3m was paid out
  • 257 new claims were paid
  • The average age of an IP claimant was 40 years old

The most common reasons for IP claims being:

  • Musculoskeletal (43%)
  • Cancer (17%)
  • Mental health (12%)

After recently adding hospitalisation cover to its income protection plan, there were five claims paid in 2019.

Declined claims

Of all protection, claims received 0.3% were not paid out due to misrepresentation (0.1%). This means the customer did not answer the application questions accurately. To the extent that, had the full and correct information been known, cover would not have been offered. Or, a specific exclusion would have been applied to the condition that the customer was claiming for. With regards to CI, 0.2% of claims did not meet the policy definition.

Financial support

Craig Paterson, interim chief underwriter at Royal London, said: “Last year we paid 99.7% of claims. We continue to focus on improving our proposition so that we can continue to pay such a high level of claims.

Cancer continues to be the most common reason for a critical illness claim. With it being the single biggest risk we all face, it’s important to have comprehensive cover in place. Earlier this year, we made improvements to our critical illness and children’s critical illness cover available through our menu plans. In 2019, we paid out for claims on product features we’ve introduced in previous years such as pregnancy-related complications and hospitalisation cover.

Paterson added: “Receiving a payout can help to ease the financial strain of bereavement or falling seriously ill. However, money can’t always ease the emotional strain. Our Helping Hand service offered through all of our protection policies is available to all customers and their families, so they can receive the emotional support they need.”

Source: Cover Magazine June 2020

If you are interested in arranging protection insurance it really can pay to take expert advice.

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Next steps

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Any quote that your adviser provides you with will take into account your circumstances and medical history, as well as your budget!

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