1 Critical Illness Report (January to June 2013) 52,929,390 paid out in critical illness claims in the first six months of 2013* 66 % Cancer 12 % Heart Attack 9 % Other 3 % Benign Brain Tumour 4 % Multiple Sclerosis 6 % Stroke *Scottish Provident critical illness claims paid 1 January to 30 June 2013.
2 Critical illness claims report At Scottish Provident we pride ourselves in providing quality cover and a proven track record for claims paid. This report details our critical illness paid claims in the first six months of It details the illnesses which led to the claims, explains why some are not paid and also gives guidance on how you can help your clients ensure that their claim is paid. What is critical illness benefit? Critical illness benefit pays out if your clients suffer a critical illness, listed within the plan, which meets our definition. This benefit can be taken out on a level, increasing or decreasing term basis and is available for a fixed or renewable term. Why is it important? For most of us, the importance of having critical illness cover in place does not become clear until we need to make a claim. But it is not just about having the right amount of cover in place. It is about having quality cover that will pay out when it is needed, offering peace of mind to planholders. Our claims statistics At Scottish Provident, we believe it is important to be open about our critical illness claims. We want to be able to pay out to your clients when they make a claim helping them in their time of need. Please note that these statistics do not include children s critical illness claims paid. These are reported individually on page 3. claims January - June 2013 amount paid 52,929,390 number of claims paid 585 % of claims paid 91% Average payout 90,478 Largest claim value 622,000 Average age of claimant 49 Average time period in force before claim 9 years 9 months Unpaid claims January - June 2013 number of unpaid claims 61 % of unpaid claims 9% Number of claims declined because the illness suffered did not meet one of our critical illness definitions Number of claims which resulted in no payment owing to the discovery of material non-disclosure at the time the plan was taken out. These plans were cancelled and the premiums refunded 43 (7%) 18 (2%) 2
3 Children s critical illness breakdown No one likes to think of their child becoming critically ill, but it is an unfortunate reality. At Scottish Provident we give your clients financial peace of mind by covering their children for critical illnesses. Our experience with children s claims is that thankfully, their ailments are often not critical, nor do they produce lasting symptoms, which explains the high percentage of unpaid claims for children s critical illness. claims January - June 2013 amount paid 633,824 number of claims paid 32 % of claims paid 91% Average payout 19,807* Average time period in force before claim 7 years, 9 months This money could help provide the best care and support for a sick child and allow their parents the financial freedom to change their working patterns in order to look after them. Children s critical illness is our 4th highest claim paid category. Unpaid claims January - June 2013 number of unpaid claims 3 % of unpaid claims 9% Did not meet definition 3 (9%) * Children s critical illness pays out the lesser amount of either 20,000 or 50% of your client s main critical illness cover amount. ** Scottish Provident critical illness claims paid figures 1 January to 30 June ,824 paid out in children s critical illness claims in the first six months of 2013** 3
4 Critical illness claims report paid summary Cause of CI Claim All Male Female % of * This category includes other critical illness definitions where only single claims have been paid. Please note, TPD and terminal illness are not included within these claims figures. We do not cover all critical illnesses including some types of cancer. For further information on our products, including any exclusions and limitations, please see our product literature. % of Average Age at Claim Average number of months in force before claim Cancer ,054,099 43% ,300,835 57% ,753, Heart Attack 68 5,450,107 88% 60 4,915,307 12% 8 534, Stroke 38 2,812,841 76% 29 2,357,788 24% 9 455, Multiple Sclerosis 21 1,436,238 38% 8 522,424 62% , Benign Brain Tumour 16 1,542,059 44% 7 674,958 56% 9 867, Heart Valve Replacement or Repair 12 1,054,427 92% 11 1,004,151 8% 1 50, Parkinson's Disease 8 475,096 87% 7 440,440 13% 1 34, Coronary Artery By-Pass Grafts 8 471,666 87% 7 403,279 13% 1 68, Angioplasty 5 668, % 5 668,231 0% Major Organ Transplant 5 474,361 60% 3 278,721 40% 2 195, Coma 4 640, % 4 640,623 0% Aorta Graft Surgery 2 173, % 2 173,474 0% Dementia 2 52,652 0% % 2 52, Motor Neurone Disease 2 102,766 50% 1 85,369 50% 1 17, Traumatic Head Injury 2 98, % 2 98,545 0% Other* 4 422,206 25% 1 40,000 75% 3 382, TOTAL - Without Child CIs ,929,390 53% ,604,144 47% ,325,246 paid by age 23 % 45 to 49 Age group No. of claims paid amount paid 20 % 40 to 44 Less than ,334, ,722, ,660, ,022, ,868, ,803, ,241, % 35 to 39 Older than ,276,485 6 % TOTAL ,929, and under 2 % 65 and older 4 % 60 to % 55 to % 50 to 54 4
5 Cancer claims paid summary Site of Cancer All Male Female % of % of Average Age at Claim Average number of months in force before claim Breast ,475,405 0% % ,475, Malignant Melanoma 42 4,318,606 62% 26 3,272,374 38% 16 1,046, Bowel/Colon 36 3,423,413 67% 24 2,598,108 33% , Prostate 19 1,558, % 19 1,558,805 0% Testicles 16 1,901, % 16 1,901,984 0% Ear/Nose/Throat 15 1,696,069 87% 13 1,434,855 13% 2 261, Leukaemia 14 1,910,747 86% 12 1,533,477 14% 2 377, Non-Hodgkin's Lymphoma 11 1,302,528 36% 4 426,024 64% 7 876, Lymphoma 11 1,206,724 64% 7 799,596 36% 4 407, Brain 9 872,294 56% 5 441,899 44% 4 430, Cervix 9 810,478 0% % 9 810, Ovaries 8 832,668 0% % 8 832, Sarcoma 8 511,413 50% 4 234,138 50% 4 277, Kidney 7 424,324 86% 6 362,644 14% 1 61, Hodgkin's Lymphoma 6 491,095 50% 3 293,845 50% 3 197, Lung 6 383,857 67% 4 322,306 33% 2 61, Pancreas 6 309,407 67% 4 182,953 33% 2 126, Liver 5 334,153 60% 3 194,055 40% 2 140, Oesophagus 5 333,021 40% 2 236,300 60% 3 96, Stomach 5 276,547 40% 2 171,293 60% 3 105, Bone 4 308,257 75% 3 208,257 25% 1 100, Salivary Glands 4 367,824 25% 1 221,172 75% 3 146, Thyroid 4 614,725 25% 1 65,000 75% 3 549, Womb 4 153,129 0% % 4 153, Bone Marrow 3 255,613 0% % 3 255, Gastric 3 302,807 67% 2 214,166 33% 1 88, Other* 6 678,207 67% 4 627,584 33% 2 50, TOTAL ,054,099 43% ,300,835 57% ,753, * This category includes other types of cancer where only single claims have been paid. 5
6 Critical illness claims report Financial support at a time of need the facts Here are a few examples of claims that we have paid so far in 2013: In March we paid over 145,000 to a shop assistant who was diagnosed with breast cancer - the plan had only been in force 4 months. In April we paid over 125,000 to an aircraft mechanic who had suffered a stroke. In February we paid over 210,000 to a financial adviser who had suffered a heart attack. If your clients stop paying premiums they will not get anything back, their plan will stop and they will no longer be covered for their benefits. Premiums should continue to be paid until a decision has been reached on a claim. Plans have no cash in value at any time. In June we paid over 620,000 to company director who was diagnosed with breast cancer - the plan had only been in force 9 months. In March we paid over 350,000 to an insurance broker who was diagnosed with testicular cancer. Over * Scottish Provident critical illness claims paid figures 1 January 1996 to 31 December billion paid in critical illness claims since 1996*. 6
7 How you can help us pay claims We know that your clients have taken out critical illness cover to provide some peace of mind in the event of developing a critical illness. Our aim is to pay valid claims as promptly and efficiently as possible. We always assess claims in a fair and consistent way. However, there may be occasions when claims are not paid because of non-disclosure or if a claim does not meet any of our critical illness definitions. What do we mean by non-disclosure? Non-disclosure occurs before the plan starts, generally it occurs if your clients fail to fully disclose anything that may be of relevance to the questions on their application form. This may include a detail in their past medical history which seems unimportant to your clients at the time however, we would rather they gave too much information than too little, allowing us to decide what is important. If, while assessing a claim, it is established that there has been non-disclosure which would have affected the terms on which we would have accepted the case, then the sum assured would be altered to reflect those terms. If the benefit would have been declined then no payment would be made. Help your clients to avoid non-disclosure In order to help your clients as much as possible: Highlight the importance of giving full details of their medical history at application stage. Make sure that all questions on the application form are answered fully. It is far better to give more information than not enough. Your clients may wish to speak to their doctor before making the application if they are unsure about any details. We continue to look at ways in which we can improve our application form in order to prompt your clients to give as much information as possible. This should further assist you in ensuring full-disclosure and in delivering a better service for your clients. The following claims were not paid due to non-disclosure of relevant information at the application stage: A claim was made by a 62 year old female for Parkinson s Disease. However, the claimant failed to declare on her original application that her sister had been diagnosed with Parkinson s disease. A 39 year old female claimed for lung cancer but failed to declare on her original application that she was a smoker. 7
8 We aim to cover many of the life-changing illnesses that would require your clients to make significant adjustments to the way in which they live their lives. What do we mean by does not meet the critical illness definitions? We will not pay a claim for any illness not included within our list of definitions and we urge you and your clients to be fully aware of this. However, our claims process enables your clients to request a claim form even when their illness is not specifically covered by the plan. This enables us to assess whether the claim can be paid under any of the conditions covered, in other words leaving no stone unturned. We could reduce the number of unpaid claims under the does not meet definition heading if we filtered out grey claims at the initial telephone stage. But we believe our process is treating customers fairly, which outweighs our desire to produce low declinature rates under this heading. The following claims were not paid out, as they did not meet the plan definitions: A 59 year old male claimed under the cancer definition. But, the claim was not valid as the bladder tumour was histologically confirmed as being in situ. A claim was submitted by a 44 year old male for a stroke. However, the claim was not valid as the claimant had suffered a transient ischaemic attack which is specifically excluded under this definition. Here to help you Underwriting support Helpline support Helpline Please note that we do not cover all illnesses, including some types of cancer. For more information, refer to our product literature for details on the illnesses we cover and any exclusions that may apply. Visit for more information, or call our sales team on Scottish Provident is a division of the Royal London Group, which consists of The Royal London Mutual Insurance Society Limited and its subsidiaries. The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number It provides life assurance and pensions and is a member of the Association of British Insurers and the Association of Financial Mutuals. Registered in England and Wales number Registered office: 55 Gracechurch Street, London, EC3V 0RL. SCPR5658 AUG13 LD