Contact us: 1800 111 456Freecall Australia
 

Claims acceptance rates improve in 2021

Life insurance claims statistics for 2021 released by APRA show an overall improvement in claims acceptance rates compared to 2020.

The average claims acceptance rates for policies distributed by life insurance advisers/brokers have increased year on year, as below:

Claims acceptance rates

Cover Type 2020 (%) 2021 (%) Improvement (%)
Death/Life 96.4 97.1 +0.7
TPD 81.5 82.5 +1.0
Trauma 85.7 86.8 +1.1
Income Protection 94.0 95.0 +1.0

However, the news on claim processing times is not as good.  The average time to process claims has not improved for life insurance claims and for the other cover types the processing time has increased:

Average Claims Processing Time

Cover Type 2020 (mths) 2021 (mths) Change (mths)
Death/Life 1.5 1.5 Nil
TPD 6.8 7.4 +0.6
Trauma 1.6 1.7 +0.1
Income Protection 1.5 1.6 +0.1

The 2021 data again confirmed that there is a difference in claims performance depending upon distribution channel.

Policies purchased direct from the insurer had lower claims acceptance rates and longer processing times than so called “retail” policies distributed by life insurance advisers/brokers as shown in the table below.

Claims Performance – Retail versus Direct Policies (2021)

Life Insurance  Retail Direct
Average Claims Acceptance 97.1% 89.7%
Average Claims Processing Time 1.5 months 2.8 months

 

Income Protection Retail Direct
Average Claims Acceptance 95.0% 90.8%
Average Claims Processing Time 1.6 months 2.0 months

Marketing methods and policy exclusions have been identified by the Royal Commission and ASIC as potential reasons for the difference in claims acceptance rates.

Another factor identified by APRA is the level of support provided at claim time.  Retail policyholders will generally receive assistance from their life insurance adviser or broker when lodging their claim.

However policyholders who have purchased direct from the insurer will have to deal with the insurer’s claims department on their own, without the help of an experienced industry professional.

As in previous years, Insurance Watch has used the latest APRA/ASIC statistics (for adviser/broker distributed policies only) to determine which three insurers were the best and fastest at paying claims in 2021.

 

Top Claims Paying Insurance Companies 2021:
1.  Westpac/BT
2.  MLC
3.  Resolution Life/AMP

 

Fastest Claims Paying Insurance Companies 2021:
1.  TAL
2.  Resolution Life/AMP
3.  CommInsure

 

The results for the individual companies are shown below:

 

LIFE INSURANCE CLAIMS PERFORMANCE IN 2021

Insurance Company Life Insurance Claims Accepted % Average Claim Time months
AIA 96.6 1.7
Resolution Life/AMP 97.1 0.8
NobleOak/NEOS N/A N/A
ClearView N/A N/A
CommInsure 97.0 1.2
MLC 96.8 2.0
OnePath 98.7 1.9
TAL 95.8 1.3
Westpac/BT 98.1 1.7
Zurich 98.3 1.8
Industry Average 97.1 1.5

 

TPD INSURANCE CLAIMS PERFORMANCE IN 2021

Insurance Company TPD Insurance Claims Accepted % Average Claim Time months
AIA 67.7 9.2
Resolution Life/AMP 89.2 5.4
NobleOak/NEOS N/A N/A
ClearView N/A N/A
CommInsure 83.5 7.7
MLC 86.7 7.2
OnePath 76.3 9.6
TAL 78.0 6.9
Westpac/BT 87.9 7.9
Zurich 82.1 8.4
Industry Average 82.5 7.4

 

TRAUMA INSURANCE CLAIMS PERFORMANCE IN 2021

Insurance Company Trauma Insurance Claims Accepted % Average Claim Time months
AIA 86.7 1.8
Resolution Life/AMP 85.4 1.6
NobleOak/NEOS N/A N/A
ClearView 90.5 2.0
CommInsure 84.1 2.0
MLC 90.0 2.0
OnePath 83.2 2.1
TAL 85.1 1.1
Westpac/BT 90.4 1.6
Zurich 91.2 1.4
Industry Average 86.8 1.7

 

INCOME PROTECTION CLAIMS PERFORMANCE IN 2021

Insurance Company Income Protection Claims Accepted % Average Claim Time months
AIA 91.5 1.9
Resolution Life/AMP 96.3 1.6
NobleOak/NEOS 95.9 2.8
ClearView 91.9 3.1
CommInsure 97.6 1.3
MLC 94.8 1.6
OnePath 94.6 1.6
TAL 95.6 1.2
Westpac/BT 96.4 1.4
Zurich 93.4 1.6
Industry Average 95.0 1.6

The 2021 results can be viewed graphically at Claims Statistics – All the Facts and Figures.  Detailed results for all distribution methods can be viewed on the ASIC Moneysmart website.

More information on each of the insurance companies listed above can be found at Compare Life Insurance Companies.

0