Discovery Life payouts for 2024 again shows increase in suicides

Discovery Life’s payouts for 2024 saw the increase in suicides continuing, with financial problems cited as the reason for suicide among older people between the ages of 41 and 60.

Suicide topped the reason for death in this group, at 45%.

One in five of the death claims Discovery Life received last year were due to unnatural causes, with the largest component attributed to suicide at a staggering 35%, followed by motor vehicle accidents at 23%.

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Discovery Life paid out R11.5 billion in 2024

Discovery Life paid out R11.5 billion to clients in 2024 according to its 2024 claims experience report, with R6.85 billion in individual life insurance claims, R2.4 billion in shared-value payments (rewards for healthy behaviour) and R2.3 billion in group risk claims.

The R6.85 billion paid to individual life insurance clients is made up of:

• Life cover claims of R3.4 billion
• Living benefit claims that included R1.5 billion for the severe illness benefit, R933 million for the capital disability benefit and R673 million for the income continuation benefit
• Additional benefits, with more than R260 million paid out for the Global Education Protector, funeral policies and other benefits.

Sylvia Steyn, head of claims at Discovery Life, says that in 2024, 99.3% of all claims were paid out.

“Within the remaining 0.7%, 0.4% of claims were repudiated for non-disclosure, 0.2% for misrepresentation and 0.1% for fraud.”

This means that the majority of payouts went to clients who are still alive.

Gareth Friedlander, deputy CEO of Discovery Life, says Discovery Life pays more through living benefits (R3.1 billion) and Shared-value rewards (R2.4 billion) than for mortality claims (R3.4 billion).

“By comparison, the industry pays about 20-30% in living benefits, while Discovery Life is paying out over 60% to clients who are still alive.”

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Cancer dominated in claims Discovery Life paid out

The report also shows that cancer dominates, but an increase in screening rates affects the early-stage claims trajectory.

The 2024 claims data shows that cancer was the highest cause of death for women (35%), while it was also the most common severe illness for both women (51%) and men (37%) and the most common cause of disability among women (34%) and men (30%).

Compared to 2020, the 2024 Discovery Life data show significant increases in screening for common cancers, with mammograms up by 14%, colorectal cancer screening 29% higher, and 19% more prostate exams – all at all-time highs.

Dr Maritha van der Walt, chief medical officer for Discovery Life, says thanks to the increase in screening rates, there has been a 62% increase in early-stage cancer claims compared to 2020’s claims on illness cover.

“As a proportion of all cancer claims, lower severity claims continue to have an upward trajectory, showing that these cancers continue to be detected earlier.

“While Stage 3 and 4 cancers have remained relatively stable over that time, it is in the disability claims for Stage 4 cancers where we see incredible benefits of screening, with those claims dropping by 16% since last year.”

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Early detection remains key for better outcomes

She emphasises that early detection remains key to better outcomes.

Data from the Discovery Vitality HealthyFutures model and the US-based Surveillance, Epidemiology and End Results Programme (known as SEER), show that on average someone diagnosed with early-stage breast cancer can expect a 96% five-year survival rate.

SEER also found that men who are diagnosed with localised prostate cancer have a 99% five-year survival rate.

Cancer and heart and artery conditions were prominent in life cover claims for older age groups, but looking at causes of death across all age groups, the 2024 data show deaths occurred for a number of reasons.

The high proportion of unnatural deaths highlights the need for comprehensive life cover for everyone, irrespective of underlying health status or age, Van der Walt says.

“The data also emphasise the importance of taking mental health concerns seriously and fostering a culture of better driving on South African roads.”

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Discovery Life payouts show importance of severe illness cover

The report also points out how important severe illness coverage is for subsequent claims and at older ages.

In 2024, Discovery Life paid out a total of R1.54 billion for 2,900 severe illness claims, with R275 million paid out in second or subsequent claims. Nearly one in three made their third or subsequent illness claim, and some claimed over 10 times.

Discovery Life also paid R128 million in converted severe illness claims, where a client’s disability cover expires and automatically converts to illness cover.

“Illness cover and features like our automatic disability benefit conversion are crucial to ensuring clients have illness protection at older ages.

“This is very relevant, considering that 28% of severe illness claims are made by clients over 60. Ten years ago, this age group accounted for 11% of our illness claims. Five years ago, it was 20%.

“While it is natural for claims attributable to this age group to increase as our clients get older, this trend is increasing faster than we expected and shows the importance of illness protection at older ages while this cover is not always accessible or financially viable at those ages, making it is crucial to get this form of cover when you are young,” Friedlander says.

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Offshore protection in US dollars for Discovery Life clients

He also pointed out that offshore protection in US dollars offers clients and their families greater financial security through uncertain economic conditions.

“Recent geopolitical volatility has highlighted the value of offshore risk protection in diversifying clients’ cover, similar to how they might diversify their investments.

“This approach can provide a hedge against external events that affect exchange rates and protect against potential future costs and liabilities that move in line with global markets.”

Discovery Life’s Dollar Life Plan pays out claims in US dollars to provide this risk with cover diversification.

Since 2014, it has paid out more than $34 million (R660 million) in claims, with these payouts worth an extra 19% as they are denominated in US dollars.

In addition, Discovery Life paid out R2.4 billion in Shared-value benefits, which included R1.4 billion in PayBacks and R1 billion in Cash Conversions, financial rewards based on how well clients managed their health and finances.

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Healthy lifestyle lowers mortality risk Discovery Life found

Friedlander says 2024 was the first year that Cash Conversion payouts reached the one billion mark in a single year.

“This is powered by clients’ engagement in Vitality, Discovery’s behaviour-based programme that incentivises healthy living.

“Our latest claims experience also revealed that clients who reached a Gold or Diamond status experienced a 57% lower mortality risk and a 47% lower disability risk, compared to clients who were not part of or did not engage in Vitality.

“This lowered risk creates previously untapped value that we can return to clients to incentivise them to engage in healthy behaviour.”