One company pays South Africans R48 million a day

Liberty paid out R12 billion in claims in 2024 across its various business segments, which translates into around R48 million per working day. 

The insurer revealed this at its annual Claims Statistics presentation for the media, where Liberty unpacks trends within South Africa’s insurance market. 

Liberty’s annual Claim Statistics provide valuable insights into health and lifestyle trends, socio-economic challenges, and underinsurance in South Africa. 

The insurer uses this data to analyse its product performance and industry trends through data gleaned from the different life stages of Liberty’s clients. 

This enables it to develop products that are better suited to its clients’ needs and improve its distribution channels to reach clients more effectively.

Liberty has had a close relationship with Standard Bank for the past thirty years, with the two now fully integrated into the banking group. 

This significantly enhances the insurer’s distribution through the bank’s branch network and its client base, with some of its products offered through Standard Bank’s banking app. 

Liberty’s Claims Statistics for 2024 show significant growth in the value of life cover claims, up by 11.8% year-on-year to R7.51 billion. 

The value of claims under its flagship offering has steadily grown over the past decade from R1.1 billion to current levels due to growth in Liberty’s client base and the increased cost of protection. 

The R7.51 billion paid out in 2024 under its flagship Life Protector offering covered 28,889 individuals, with the average claim being for R260,000. 

This is still below the pandemic-era peak in 2021, where Liberty paid out R10.1 billion due to increased claims related to illnesses during the pandemic and income protection for those who lost their jobs. 

Liberty Corporate Benefit’s claims payouts for 2024 amounted to R2.6 billion, paid to 11,198 individuals. Its funeral insurance business had claims of R1.3 billion in 2024.

The company’s smaller offerings, such as income protection and its EduCator programme, paid out R560 million to clients.

In total, Liberty paid out R12 billion to clients across all of its offerings, which translates into payouts of R48 million per day.

The insurer paid 91.5% of all claims submitted, compared to 93.8% in 2023. Declined valid claims were a very small proportion at 0.5%. 

Declined claims under living benefits were slightly higher, mainly due to the claim event either not being covered by the policy conditions or the claim criteria not being met.

The growth in claims paid out by Liberty’s retail flagship, Lifestyle Protector, cover offering over the past two decades is illustrated in the graph below. 

Why South Africans are claiming

Last year, there were increases in claims across all four of Liberty’s key business pillars under Liberty’s Lifestyle Protector suite.

Life Protection payouts increased by 9.5% to R5.5 billion, Lifestyle Protection increased by 20.4% to R1.2 billion, Income Protection lump sum payouts rose by 18.5% to R507 million, and monthly income protection payouts were up 11.6% to R267.3 million.

While life claims made up the bulk of payments, the dramatic increase in claims from Lifestyle Protection benefits demonstrates that people are living longer with critical illnesses, the insurer said.  

One reason is that they receive treatment more promptly due to earlier detection. This highlights an increased need for living benefits and regular preventative medical screenings.

As expected, the majority of claims were from older clients, with the average age at claim being 60 for women and 64 for men. However, 25% of claims were from male clients under 55 and 35% from female clients under 55. 

Cancer (31.2%), cardiovascular disorders (22.3%), respiratory disorders (5.8%), musculoskeletal disorders (5.5%) and nervous system disorders (5.3%) were the top five claim causes, accounting for 70.2% of all claims among all benefits. 

While cancer was the leading cause for claims among men and women, 37.2% of women claimants claimed for cancer, compared to 27.9% for men.

“The higher prevalence of cancer among women can be attributed to the high incidence of breast cancer among South African women. Notably, 46.9% of cancer-related claims submitted by women were for this specific form of the disease,” Liberty Chief Medical Officer, Dr Reinhardt Erasmus said.

For men, the most common cancer was prostate cancer, accounting for 31.9% of male cancer claims.

Liberty’s Corporate Benefits business paid out R2.6 billion in claims across their product range – a 6% increase from 2023.

The most significant contributor to claims was the Group Life Assurance or Life Cover benefit, which accounted for R1.3 billion in payouts. While this represents a 2% increase in the amount paid, the number of claimants decreased by 15%.

Motor vehicle accidents were the leading cause of unnatural deaths, accounting for one in five death claims, highlighting the need for life cover that protects against unexpected tragedies.

Family Funeral Benefits experienced an 11% increase in the number of claims paid, increasing total payments in 2024 by 24% to R95 million.

Payments for Income Protection claims increased by 4%, to R927 million, with labour-intensive manufacturing, distribution, and wholesale industries accounting for 22% of total claims, largely due to a higher frequency of injuries.

Most of these injuries are related to the musculoskeletal system. This experience extended into the Lump Sum Disability Benefit, where musculoskeletal-related claims contributed to the 70% increase in total claims paid, bringing the amount to R142 million.

At least 18% of Income Protection claims came from the financial, professional and support services sector. Most concerning here was a high number of psychiatric disorder and neurological disorder claims, Liberty said.

Factors such as high stress, long working hours, job pressure, and the fast-paced nature of these industries could be key drivers of these mental health issues in the office environment.