A critical illness wave is on the way

^{By Rudi van Rooyen, Head of Group Insurance, Momentum Corporate}

While businesses are still reeling from the impact of the Covid-19 pandemic on workplaces, an ominous lull in critical illness claims is the calm before a new storm on the way.

Changes in health behaviour during Covid-19 and the lockdowns are expected to translate into a sharp rise in critical illnesses, impacting on employees’ health and productivity. Which is why it is time to put low-cost, high-value group insurance benefits on the table for your clients.

Claims for Momentum Corporate clients offering critical illness benefits increased by around 10% each year since 2016, however, in 2020 these claims declined by 15%. The number of members insured for this benefit increased last year, so this drop seems counter-intuitive. However, the decline reflects health behavioural changes since the start of the pandemic.

Healthcare avoidance

Fearful of contracting the virus, many people have avoided healthcare visits and preventative screening tests during lockdown. As a result, they have not received the care they need, and the diagnosis of chronic conditions like diabetes, heart disease and cancer has been delayed. Later detection and treatment of these illnesses may mean their impact is more severe.

Momentum Corporate’s analysis also shows that critical illness claims in the age band of 41 to 50 years, which usually accounts for around a third of all claims, decreased by 21% in 2020, with a 14% drop in claims for the age band 51 to 60, usually responsible for 40% of claims. It is therefore in these older, more experienced employee groups that we could see a surge in future critical illness claims.

The analysis also shows that while managers or supervisors usually make up 12% of all critical illness claims, this figure increased to almost 17% in 2020. Rising disease prevalence amongst leaders is concerning, given their critical role in leading and sustaining their organisations in these times.

Illnesses and trends

Cancer accounts for over 60% of Momentum Corporate’s critical illness claims, with cardiac-related claims at around 20% of total claims. Of interest is that between 2016 and 2019, kidney failure claims more than doubled, showing that even before Covid-19, conditions such as diabetes started to impact significantly on claims.

There is growing evidence that a fair percentage of Covid-19 patients experience prolonged symptoms, also known as long-term Covid-19. Where defined critical illness conditions are triggered as a result of Covid-19, like a heart attack or kidney failure, the claim is likely to be valid. This will also fuel rising claims.

Despite great health and fitness aspirations when lockdown started, the general trend has been towards a more sedentary lifestyle. This dip in activity and elevated stress levels over this period will over time contribute towards an increase in lifestyle-related chronic illnesses.

Multiply, a health engagement programme, reports that their key indicator of members’ activity levels declined significantly in 2020. Gym visits were 50% lower year on year in December 2020, while completing 10 000 steps in a day also reduced by 15%.

Critical illness cover

A critical illness diagnosis like cancer is life-changing on many levels. A critical illness benefit pays out a lump sum that the employee can use in any way they choose. This could be to make home and lifestyle adaptions, settle debt or pay for treatment that medical schemes will not cover.

If your client is concerned about the cost of adding a comprehensive suite of critical illness benefits to their EB mix, a more affordable alternative is to provide cover just for cancer, the leading cause of claims.

Help your clients prepare for the critical illness wave on the way to our shores.