Discovery Life paid out R10.3bn to clients in 2023, down on the R11bn paid out the year before, as claims returned to patterns seen before the Covid-19 pandemic.
Discovery Life is the life insurance business of JSE-listed Discovery, which also operates a medical scheme administrator, a healthy rewards scheme called Vitality, and banking and investment services.
Discovery Life paid out R8.4bn across group risk and individual life policies and R2.1bn in what it terms “shared value benefits”, which are rewards to clients for managing their health and finances well.
The pandemic prompted a sharp drop in health screening during the pandemic as patients and health facilities scaled back on non-emergency care. The trend worried health and life insurers as the survival rate of many common cancers, including those of the breast, prostate and cervix, is much higher if they are detected early. Late-stage cancers are not only more difficult to treat, but also more costly.
In 2023, Discovery Life saw a marked increase in health screening resulting in the earlier detection of severe illnesses, including cancer. There was a continued decline in Covid-19 claims, which fell from 42% of all life cover claims in 2021, to 12% in 2022, and then to 9% in 2023.
“In the two years after the Covid-19 pandemic, we saw the impact of the sharp decline in health screenings translating into a spike in late-stage cancer diagnoses. As a group we have invested heavily in supporting a return to health screenings, the results of which are now evident in the 2023 data with a 29% increase in earlier stage cancer claims compared to 2022,” said Discovery Life deputy CEO Gareth Friedlander.
Health checks had more than doubled since 2020, he said, citing data from medical scheme administrator Discovery Health.
Later-stage cancers still constituted almost a third (31%) of all cancer claims but the proportion of less severe claims had increased, showing they were being detected earlier, said Friedland.
Among women, the biggest cause of death claims was cancer (35%), followed by conditions related to the heart and arteries, while among men the top killer was conditions related to the heart and arteries (30%), followed by cancer (24%).
The healthy behaviour encouraged by the company’s incentive programmes reduced the risk of both cancer and cardiovascular disease, said Discovery Life chief medical officer Maritha van der Walt.
Discovery Life said its shared-value payments were growing faster than claims payouts. Clients who were most actively engaged with the Vitality rewards programme had a reduced mortality rate: those who achieved the most engaged ranking of Gold or Diamond had a 57% lower mortality risk than those who were not engaged at all, it said. The lapse rate was also significantly lower among these clients, said Friedlander.
Discovery Life paid out 51% of its claims as “living benefits”, which include ancillary benefits such as disability, severe illness, and loss of income cover, compared to an industry average of 22% in 2022, he said.
“Our clams experience shows that one in five life cover claimants had already claimed for a life-changing illness or disability before they passed away,” he said.
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