Liberty announced its claims statistics for 2024 today, showing it paid out more than R12 billion in 2024 for 120 000 insured lives.
Liberty Corporate Benefits received 62 000 applications from clients to withdraw funds from their saving pots under the two-pot retirement system in 2024.
The financial services company says it paid out R600 million to 48 600 of clients who were ultimately approved, after R155.6 million was deducted for tax purposes.
Overall, the majority of claims came from Liberty’s Lifestyle Protector cover which paid out R7.35 billion to 28 889 individuals and their beneficiaries, with an average payment of R260 000 to each person or their families who claimed during the year.
Liberty Corporate Benefit’s claims payouts for 2024 amounted to R2.6 billion, paid to 11 198 individuals. Claims from Liberty’s funeral products and credit life products (partly sold through Standard Bank) made up the remainder of the total claim payouts, amounting to R1.99 billion.
Mark Barberini, head of comprehensive life solutions at Liberty, says their personal risk claim payouts show an increase of 11.8% from 2023.
Life cover dominates claims in 2024, with increases in claims across all four key pillars of the business last under Liberty’s Lifestyle Protector suite. Life Protection payouts increased by 9.5% to R5.5 billion, Lifestyle Protection increased by 20.4% to R1.2 billion, Income Protection lump sum payouts increased by 18.5% to R507 million and monthly income protection payouts were up 11.6% to R267.3 million.
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Liberty claims show people live longer with critical illnesses
While life claims made up the bulk of payments, the dramatic increase in claims from Lifestyle Protection benefits demonstrates that people are living longer with critical illnesses. One reason is that they receive treatment more promptly based on earlier detection, which highlights an increased need for living benefits and more regular preventative medical screenings.
“Insights like these point to a need for more comprehensive lifestyle protection cover, as death and unexpected medical diagnoses are not the only risks that can have a significant effect on your family and lifestyle. Unexpected life events, such as retrenchment, can also have a serious impact,” Andrew Methmann, Liberty’s chief specialist for risk pricing, says.
As expected, the majority of claims were from older clients, with the average age at claim being 60 for women and 64 for men. However, 25% of claims were from male clients under 55 and 35% for female clients under 55.
“With 2.2% of claims coming from individuals under the age of 35, it is evident that death, disability and critical illness can affect anyone, regardless of age and happen unexpectedly. It is important to encourage younger people to take out cover while they are still young and also in better health, potentially making their risk cover cheaper,” Methmann says.
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More men claimed from Liberty than women
In 2024 Liberty saw a much higher proportion of overall claims coming from men (64.8%) than from women (35.2%). While Liberty’s client base is split almost equally between men and women, one of the reasons for this gap could be the fact that a larger proportion of these men are older and more likely to claim.
The top causes of claims were cancer (31.2%), cardiovascular disorders (22.3%), respiratory disorders (5.8%), musculoskeletal disorders (5.5%) and nervous system disorders (5.3%), accounting for 70.2% of all claims among all benefits. While cancer was the leading cause for claims among men and women, 37.2% of women claimants claimed for cancer, compared to 27.9% for men.
Dr Reinhardt Erasmus, Liberty’s chief medical officer, says the higher prevalence of cancer among women can possibly be attributed to the high incidence of breast cancer.
“Notably, 46.9% of cancer-related claims submitted by women were for this specific form of the disease. For men, the most common cancer was prostate cancer, accounting for 31.9% of male cancer claims.”
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Income protection claims mainly due to musculoskeletal disorders
The number one reason for income protection claims were musculoskeletal disorders at 22.7%, followed by cancer at 16% and retrenchment at 9.9%. Kresantha Pillay, chief specialist for Liberty’s Lifestyle Protector cover, says although retrenchment claims have come down from 2023 to 2024, the need for adequate income protection cannot be emphasized enough.
“In 2024, most retrenchment claims occurred in the 35 to 44 age band, with 38.6% from women and 16.8% from men. Overall, 64.4 % of retrenchment claims were from women, while 35.6% were from men.
“This reveals a stark contrast in retrenchment claim trends and shows that in 2024, women filed nearly twice as many retrenchment claims as men. This signals a troubling imbalance in job security and underscores the critical need for income protection among women, highlighting the urgency for them to explore tailored financial solutions and safeguards.”
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Claims for serious mental disorders and suicide
Claims for serious mental disorders made up 2.8% of all retail claims in 2024. Of this percentage, 51.1% of these claims were for life protection benefits with the remainder for living benefits. The tragedy of suicide accounted for the majority of these life protection claims.
Payments for income protection claims increased by 4% to R927 million. Labour-intensive manufacturing, distribution and wholesale industries accounted for 22% of total claims, largely due to a higher frequency of injuries.
“Most of these injuries related to the musculoskeletal system. This experience extended into the lump sum disability benefit where musculoskeletal related claims contributed to the 70% increase in total claims paid, bringing the amount to R142 million,” Mangaliso Nxasana, actuarial manager at Liberty Corporate Benefits, says.
At least 18% of income protection claims came from the financial, professional and support services sector. Nxasana says most concerning here was a high number of psychiatric disorder and neurological disorder claims, suggesting that the work environment may be contributing to mental health challenges amongst employees.
“Factors such as high stress, long working hours, job pressure and the fast-paced nature of these industries could be key drivers of these mental health issues in the office environment.”
Georgianna Pepper
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