BUSINESS OF

LIFE INSURANCE

R469BN IN BENEFIT PAYMENTS

THE ASSOCATION for Savings and Investment SA (Asisa) this week released the 2017 consolidated statistics for fraudulent and dishonest claims, which show that, although the total number of thwarted fraudulent and dishonest claims across different types of long-term insurance products was much lower in 2017 than in 2016, when 13 488 claims (mostly funeral claims) proved to be irregular, the value was almost the same. In 2016, fraudulent and dishonest claims worth R1.03 billion were detected.

Donovan Herman, the convenor of Asisa’s claims standing committee, pointed out that life assurers are under constant pressure to adapt their detection methods as fraud attempts become more sophisticated due to fast-evolving technology.

He said although life assurers are frequently accused of trying to find ways of getting out of paying claims, the numbers tell a different story. Although claims worth R1.13bn were found to be irregular and, therefore, not paid in 2017, South African life assurers made benefit payments of R469bn to policyholders and beneficiaries in the same year. Of this amount, more than R60bn was paid to individuals who had experienced either death or disability in their family circle – an increase of almost R5bn from 2016.

“The reality is that as the custodians of a significant portion of South Africa’s savings pool, life assurers are obliged to protect the integrity of this savings pool and the interests of honest policyholders by preventing fraud and dishonesty.”