Our commitment is to ensure every claim that should be paid, is paid FOR ADVISERS March 2015 Life s better with the right partner
2 Claims brochure You can tell a lot about an insurance company by the way it handles claims As a company that protects the lives of more than 3.1 million Australians, we re committed to making a potentially stressful time, as smooth as possible. Our experienced claims team is committed to ensuring that every claim that should be paid, is paid. In 2014, we paid out over $860 million in claims that s over $3.4 million every working day. Claims paid in 2014 ($) Death $419,427,057 Total and Permanent Disablement (TPD) $218,214,987 Crisis Recovery $34,825,041 Income Protection (IP) $188,514,465 Other (including CCI & Whole of Life) $792,943 Total $861,774,492 Causes of claims Heart disease and cancer continue to be two of the leading causes of death in Australia 1 and accounted for the majority of Death and Crisis Recovery claims we paid out in 2014. Our definitions for both heart disease and cancer are market-leading, enabling our customers diagnosed with these illnesses to claim when they need it most. Cancer a leading cause of death 2 An estimated 128,000 new cases of cancer will be diagnosed in Australia this year, with that number set to rise to 150,000 by 2020. Cancer accounts for about 3 in 10 deaths in Australia. The most common cancers in Australia (excluding non-melanoma skin cancer) are prostate, bowel, breast, melanoma and lung cancer. 1 http://www.abs.gov.au, accessed 16 February, 2015. 2 http://www.cancer.org.au/aboutcancer/factsfigures.htm, accessed 16 February, 2015.
Claims brochure 3 Death claims Top 5 causes of Death claims we paid out in 2014 Cancer Diseases of the digestive system Respiratory 0% 5% 10% 15% 20% 25% 30% 35% 40% Death claims by gender and age Male Female 2% 10% 47% 28% Cancer Diseases of the digestive system Respiratory Other* 6% 28% 5 1 * Other causes include: Complications of pregnancy, skin disorders, infectious diseases, suicide/suspected suicide, endocrine disorders (e.g. diabetes), deaths referred to the coroner and musculoskeletal conditions resulting from accidents. Breast cancer made up 1 of all female cancer Death claims in 2014. YOUNGEST CLAIMANT AVERAGE AGE OLDEST CLAIMANT 15 YEARS 48 YEARS 76 YEARS
4 Claims brochure Total and Permanent Disablement (TPD) claims Top 5 causes of TPD claims we paid out in 2014 Musculoskeletal Mental health Cancer 0% 10% 20% 30% 40% 50% TPD claims by gender Male Female 20% 10% 5% 2% 12% Musculoskeletal 38% Cancer 38% Mental health 15% 1 9% Other* 19% 11% * Other causes include: Complications of pregnancy, accidents, skin disorders, infectious diseases, Chronic Pain Syndrome, facial injuries, endocrine disorders (e.g. diabetes), respiratory conditions and diseases of the digestive system. What are musculoskeletal conditions? In 2014, musculoskeletal conditions were the leading cause for TPD claims we paid out. Musculoskeletal conditions affect the bones, muscles and their attachments, including joint problems. There are more than 100 musculoskeletal conditions, with the most common being osteoarthritis, rheumatoid arthritis, osteoporosis and back pain. Conditions our customers claimed for included back or neck conditions, fractures, arthritis and injuries sustained in accidents.
Claims brochure 5 Examples of TPD claims we paid in 2014 Occupation Age Cause Benefit paid Manager 53 Depression $1,041,863 Builder 58 Spine and trunk injuries $578,813 Executive 34 Breast cancer $1,800,000 Construction Manager 62 $502,692 Research and Development Manager 46 Lung cancer $2,000,000 Surgeon 49 Multiple sclerosis $1,260,000 Labourer 47 Blindness $173,644 Accountant 44 Spinal muscular atrophy $689,063 General Manager 51 Paraplegia $2,094,750 Accounts Clerk 58 Parkinson s Disease $255,256 Rehabilitation the road to recovery Helping your clients get back to work At AIA Australia we understand the value of rehabilitation and we ve changed the way we approach claims to ensure Return to Work (RTW) plans are considered from the moment a claim hits our desks: We have one of the largest rehabilitation teams in the industry, with over 110 + years combined experience. Recruited allied health professionals into our claims teams. Up-skilled our claims assessors to identify suitable rehabilitation claimants. Rehabilitation screening tool embedded in claims processes. Our extensive trials confirm that rehabilitation opportunities identified through early intervention resulted in an increased number of our customers successfully returning to work. In terms of physical conditions, if a person s off work then the chance of them ever getting back to work after 20 days is 70% after 45 days is 50% after 70 days is 35% The right partner Our rehabilitation team includes rehabilitation counsellors, physiotherapists, occupational therapists and a registered nurse, who work in partnership with medical practitioners to plan and manage your client s recovery and assist them in returning to work. Rehabilitation isn t just about the physical recovery. Helping claimants, especially those who are self employed, restores more than their income, it can also help restore their identity and self-esteem. Our RTW programs are holistic, considering each individuals social situation, psychological factors and other health conditions. Each claimant receives a tailored program which can include modification of work environments, work related counselling, graded RTW programs, re skilling/retraining or career advice and redirection. Our rehabilitation services achieved an 80% return to work rate in 2014, compared to the industry average of 5 3. 3 Based on the Swiss Re Rehabilitation Watch 2014
6 Claims brochure Crisis Recovery claims Top 5 causes of Crisis Recovery claims we paid out in 2014 Cancer (excluding breast cancer) Breast cancer 0 10 20 30 40 50 60 Crisis Recovery claims by gender 2% 8% 2 Male 6% Cancer 5% 6 Other* 81% 5% Female 45% * Other causes include: Infectious diseases, musculoskeletal conditions, diseases of the digestive system, respiratory conditions and coronial investigations. 45% of all female Crisis Recovery claims for cancer were for breast cancer. Breast cancer also accounted for 1 of total Crisis Recovery claims. All too common causes Over recent years the number of Crisis Recovery claims we have paid for cancer has risen from 134 claims in 2012, to 183 claims in 2014. As the disease continues to be a leading cause for both Death and Crisis claims, we ve structured our cancer definitions to be the best in the market. Breast cancer 4 In 2015, it is estimated that 15,600 women will be diagnosed with breast cancer. The risk of developing breast cancer increases with age; the average age of first diagnosis in women is 60 years. One in eight women will develop breast cancer in their lifetime. 4 http://www.bcna.org.au/about-breast-cancer, accessed 16 February, 2015
Claims brochure 7 Heart disease After cancer, cardiovascular problems were a major cause for our Crisis Recovery claims. The vast majority of these were male claimants, with heart conditions making up 2 of all male Crisis Recovery claims in 2014. In Australia, every nine minutes someone suffers a heart attack. 5 Your clients can be assured that if they need to make a claim, we ll pay a crisis recovery benefit for any heart attack that meets our market-leading definition. A crisis event can happen to anyone YOUNGEST CLAIMANT AVERAGE FEMALE AGE AVERAGE MALE AGE OLDEST CLAIMANT 25 YEARS 48 YEARS 51 YEARS 68 YEARS Help when it matters Over 95% of Australians do not have adequate levels of life insurance 6. One in five men and one in seven women will suffer a critical illness before age 64 7. As the cost of living increases, many people look for ways to cut back where they can, including cancelling their life insurance to free up extra cash flow. While cutting back on this expense may make sense to your clients in the short term, it could cause them significant financial hardship in the future, in the event of the unexpected diagnosis or life changing event. The insurance gap in 2014 At AIA Australia, we have a number of innovative product solutions which may address concerns around premium affordability. Contact us to find out more. 39.7 YEARS Average age of customers who took out Crisis Recovery cover 42.5 YEARS Average age of cancellation 50 YEARS Average age of claim 40 41 42 43 44 45 46 47 48 49 50 5 http://www.heartattackfacts.org.au, accessed 16 February 2015 6 Lifewise/NATSEM study, 2010 7 Rice Warner Report on Underinsurance in Australia 2011
8 Claims brochure Income Protection (IP) claims Top 5 causes of IP claims we paid out in 2014 Musculoskeletal Mental health Cancer (excluding breast cancer) Breast cancer 0 10 20 30 40 50 IP claims by gender Male Female 20% 8% 7% 1 39% Musculoskeletal Cancer (excluding breast cancer) Breast cancer Diseases of the digestive system Mental health Other* 1% 18% 9% 11% 7% 10% 38% * Other causes include: Infectious diseases, coronial investigations, Chronic Pain Syndrome, skin disorders, complications of pregnancy, respiratory conditions, facial injuries, suicide/suspected suicide and endocrine disorders (e.g. diabetes). Examples of IP claims we paid in 2014 Occupation Cause Age Benefit Physiotherapist Breast cancer 54 $28,188 Accountant Shingles 52 $8,176 Environmental Research Scientist Melanoma 47 $117,439 General Electrician Burns 31 $360 Sales Representative Depression 51 $85,505 Hairdresser 22 $26,709 Animal Trainer Chronic back pain 32 $2,060 Carpenter Fracture 37 $153,543 Architect Broken thighbone 58 $68,486 General Manager Parkinson s disease 49 $52,991
Claims brochure 9 Helping people when they need us most Reasons for declining a claim In 2014, we paid over $860 million in claims with a 92.9% acceptance rate. We re committed to the prompt assessment and payment of valid claims. However, if we do have to decline a claim it s generally for one of these reasons: The claimant doesn t qualify for a Crisis Event We cover up to 49 Crisis Events. Your client must meet the definition of a Crisis Event as listed in their policy. If their condition isn t listed, or the severity of their condition does not meet the definition, they will not be eligible to claim. The claimant didn t disclose a pre-existing condition at the application stage Not disclosing a pre-existing condition upfront can impact your client s claim so it s vital that all pre-existing conditions are disclosed at the application stage to avoid us possibly having to decline the claim. What you can do to help your client make a claim Before the claim, communicate the benefits your client may be entitled to in order to ensure pre-existing conditions are disclosed; Help with completing documentation AIA Australia requires; Help gather financial evidence if it s required; If mobility is a challenge for your client, consider offering to assist them with arranging transportation to see their treating doctor (where practical and appropriate) to complete the claim form; Follow up any outstanding requirements which may slow down the claims payment; and Reassure your client that AIA Australia will consider their claim with empathy and integrity.
For more information contact a member of the AIA Australia Client Development team on 1800 033 490 or visit AIA.COM.AU Copyright 2015 AIA Australia Limited (ABN 79 004 837 861 AFSL 230043). All rights reserved. The life insurance policies relating to Priority Protection and Priority Protection for Platform Investors are issued by AIA Australia. This publication has been prepared for distribution to financial advisers only and is not for wider distribution. This information is current at the date of this publication and is subject to change. This provides general information only, without taking into account factors like the objectives, financial situations or needs of any individual. Before acting on the information in this publication, individuals should consider its appropriateness having regard to such factors. Individuals should also obtain a PDS relating to these products (available at aia.com.au) before making any decision about whether to acquire any of them. This publication is only a summary of the circumstances in which AIA Australia pays claims under Priority Protection and Priority Protection for Platform. The payment of claims is subject to the terms and conditions of the relevant product as summarised in the relevant PDS. For further information on the circumstances in which AIA Australia would pay claims please contact your client development manager and review the relevant PDS. AIA07045 03/15