Insurers paid out £202m to support families who lost loved ones due to coronavirus in 2020 including a £250k payout made the day after a death
- Insurance firms paid out £553,000 every day to grieving families in 2020
- 11,198 claims were received under individual and group life insurance policies
- This included a £250,000 payout made the day after notification of death
Insurers paid out £202million – the equivalent of £553,000 every day – to support the families of people who sadly died due to Covid-19 in 2020, new data has revealed.
Payouts included £250,000 made the day after notification of death, and a £1million payment to dependants, according to figures issued today by the Association of British Insurers.
This is the first time the trade body has collected life insurance payouts arising from a single event, reflecting the unprecedented pandemic.
These figures compare to the £5.8billion paid out for all protection claims in 2019.
Insurers paid out £202m to support the families of people who died due to Covid-19 in 2020
Some 11,198 claims were received under individual and group life insurance policies.
Of these, 10,205 were individual policies, for example whole life, term insurance and critical illness claims, with 993 on group life insurance schemes.
The vast majority of these claims – 96 per cent for individual and 99 per cent for group – have been paid. It said the remaining valid claims are being processed as quickly as possible.
Of the total £202million paid, £128million relates to individual policies, with £73million paid under group schemes.
Meanwhile, the average payout on individual policies was £13,100 whilst for group polices it was £74,600.
In addition, £2.4million has so far been paid from 968 claims made under individual and group income protection insurance, so helping those who suffer a loss of income due to Covid illness.
In one instance, a death claim, under a life insurance policy, for £250,000 was paid one day after notification of the death.
The coronavirus vaccination rollout is underway in the UK with hopes it will curb virus numbers
Another claim, under a policy to cover mortgage payments, led to £91,000 being paid within two days of notification.
One particularly large death claim led to £1million being paid to the deceased’s dependants.
Meanwhile, a hospital nurse, diagnosed with Covid-19 which deteriorated, who was left with Permanent Neurological deficit with severe memory problems, received a payout of £144,900, on a critical illness policy.
Across all insurance products, including business interruption and travel insurance, ABI members expect to pay up to £2.5billion for Covid-19 insurance claims incurred in 2020.
Yvonne Braun, the ABI’s Director of Long-Term Savings and Protection, said: ‘No one will have been affected by the pandemic more than the families of those who have tragically died due to Covid.
‘While no amount of money can ever replace a life, insurers have and continue to do everything they possibly can to help families cope financially through these distressing and worrying times.’
The UK insurance and long-term savings industry is helping support some of the people hardest hit by the pandemic.
Launched in May 2020, the Covid-19 Support Fund has raised over £100million to help charities affected by Covid-19, providing both immediate help and putting in place a longer-term programme of support for people, communities, and issues where there is the greatest need.