Higher life insurance premiums for the unvaccinated on the cards

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Large insurers like Momentum Metropolitan, Old Mutual, Discovery and Sanlam share the same sentiment that new clients who seek life insurance coverage but are not vaccinated should pay higher premiums, depending on their profile results. of combined risk.

Of course, several factors are taken into account when assessing one’s risk profile, such as age, state of health and existing co-morbidities, but not being vaccinated against the Covid-19 virus could weigh on new applicants for a life insurance policy.

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Proof of vaccination

Momentum Metropolitan’s retail life insurance marketing manager George Kolbe told Moneyweb the insurer started asking new customers looking for life coverage for proof of vaccination in December 2021.

“Based on their individual risk profile [age, health, comorbidities and so on], their immunization status may impact their premiums and premiums may be charged for unvaccinated clients, ”Kolbe said.

Kavir Ramjee, Managing Director of Old Mutual Protection Solutions, expressed similar sentiments: “Old Mutual will review the vaccination status of new customers to offer tiered pricing for underwritten life and funeral products. ”

Read: Claims related to Covid-19 continue to hammer life insurers

“We will assess each client’s risk against a sample of relevant factors, including age and the presence of co-morbidities,” he said.

Old Mutual’s position on the matter is that the vaccinated should not be expected to subsidize their unvaccinated counterparts.

“Just as non-smokers shouldn’t have to subsidize smokers’ insurance premiums, we believe the same principle should apply to vaccinated clients, who shouldn’t have to subsidize their unvaccinated counterparts.” Ramjee said.

Read:

Discovery, which has taken a clear stance on vaccination mandates in recent months, says new clients who refuse to be vaccinated may be overcharged based on increased risk.

Sanlam takes a slightly conservative stance

Meanwhile, Sanlam takes a slightly more reserved stance on premium costs for its new, unvaccinated life insurance clients, saying it won’t treat people’s choice to vaccinate the same as people’s choice. To smoke. However, the group did not specifically say that new unvaccinated customers would not face higher fees.

“We don’t think we’re going to divide you, like smokers and non-smokers, into two categories with different premium rates,” Sanlam Group CEO Paul Hanratty told Moneyweb.

In an operational update for the 10-month period ending Oct. 31, the group recorded excess claims of Rand 3.42 billion within its Sanlam Life and Savings business for the period, which it said , was better than its initial long-term assumptions.

Read: Sanlam sees “many more deaths and grim funerals”

However, the release of the group’s discretionary reserves has helped offset the impact of excess mortality claims and, as such, the insurer has said it will take a risk-based approach to determining premiums for its new clients. not vaccinated.

“We set the prices at a fairly granular level and it is not easy, you are vaccinated or you are not vaccinated [approach]”Hanratty said.

“What we do know about vaccination is that it’s actually more important for people with co-morbidities and older, so we’re taking a risk-based approach to this thing.

“That’s not to say that Covid-19 won’t kill you if you’re not vaccinated at 25, but the odds are much lower than for an older person with co-morbidities.”

Insurers may deny coverage in certain cases

All of the insurers mentioned noted that the determination of the cost of premiums for new clients will be determined on a case-by-case basis and that not receiving a vaccine will not automatically result in a dramatic increase in life insurance costs for new clients. new customers.

However, in light of this, Momentum Metropolitan has made it clear that it may decline to cover potential clients if their combined risk profile requires it.

“The [vaccination] the impact on the premium will range from no impact for some clients to a health charge, or we could deny coverage depending on the combination of the factors mentioned, ”Kolbe said.

Costs of Covid-19

Insurers’ decision to start considering vaccination status of new clients when assessing client risk profile comes as Momentum Metropolitan and Old Mutual recently reported significant profit losses due to Covid-related mortality losses -19.

In November, Momentum Metropolitan reported a 63% drop in operating profit for the three-month period ending September 2021, while Old Mutual reported that claims related to Covid-19 wiped out around 6, R 6 billion from its profits for the nine months ending September 30.

Read:

This position also comes as more and more employers announce workplace vaccination mandates and the National Council for Economic and Labor Development (Nedlac), at its 26e Tuesday’s annual summit, expressed support for mandatory vaccinations.

Listen to Fifi Peters talk to Michael Evans from Webber Wentzel about the legal side of vaccination warrants (or read the transcript):


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