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South Africa’s largest life insurers have reported increases of 50% to 60% in death claims against fully underwritten individual life policies between March last year, when the first Covid-19 case was recorded in South Africa, and the end of January 2021.
Although life insurers anticipated that death claims would increase in line with the national death rate during the second wave, insured lives lost exceeded the expected death rate by four times at the peak of the second wave in January 2021.
In comparison, the country as a whole saw an increase in reported deaths of 2.8 times the expected death rate.
SA life insurers see shock increase in death claims Business Insider SA
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There was a 40% increase in death claims from SA insurers last year - almost 120,000 more claims for funeral and life policy payouts than in 2019.
In January and February of this year alone, Old Mutual received R1.9 billion in death claims.
Still, the South African life insurance industry has more than double the legally required capital buffer in place.
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New numbers from the Association for Savings and Investment South Africa (ASISA) show that the life industry recorded 434,216 death claims in 2020 - almost 40% more than the 317,442 claims received in 2019.