The South African market had not taken much time to adopt critical illness cover. The success of critical illness cover in the South African market may have been one worth considering. Should it not have been this way, critical illness cover might not have reached worldwide destinations as successfully as we see nowadays. However, Munich Re 2000 affirms that accelerated critical illness policies may be enduring a downfall recently. Let’s see.

According to Munich Re 2000, around 60 percent of life policies may have been accelerated with critical illness cover during the late 1980’s. Recent reports carried out may show the fact that this value may have eventually decreased to 25 percent. There may be a reason that could explain this fact. Major medical expenses may be taken in South Africa to provide additional benefits to cope with medical expenses. As a matter of fact, the MME may have been able to close the gap due to the lack of facilities resulting from the healthcare system much better than critical illness cover. Moreover, the MME may be much cheaper than critical illness cover. Also, it may cover much more conditions than critical illness cover. Another advantage with MME is that it may be offered as a family protection plan. Thus, looking at these factors, people may be eventually losing interest in critical illness cover.

Furthermore, some problems may have been encountered by insurers after the implementation of critical illness cover in the South African market. One problem could be that critical illness claims may have risen suddenly soon after the start of newly taken policies. The majority of claims at that time may have been concerning multiple sclerosis and cancer. Thus, it may be assumed that people may have self diagnosed the critical illness before taking out the cover. Therefore, this may have led to these critical illness claims being rejected as underwriting may have not detected these conditions. So, measures of precaution may have been taken by including the waiting period. The waiting period may stipulate that the claimant should wait for a fixed lapse of time before the payment is awarded. It may be important to point out that some waiting periods may reach around 6 months. But this may also vary according to certain critical illness conditions such as cancer and multiple sclerosis.

In addition to, as in the UK, the success of standalone critical illness cover in South Africa also may have been minimum. There could be some reasons that may have led to the unpopularity of standalone critical illness cover. Firstly, standalone critical illness cover may have been expensive. Secondly, the toughness of certain rules regarding definitions of illnesses may have also been responsible for the lack of sales of this type of cover. Also, dilemmas in connection with legislation and tax procedures may have obliged insurers to keep the product’s high price tag. People may have then preferred accelerated covers such as life with critical illness cover or mortgage with critical illness cover. As a result there may be no more companies offering standalone critical illness policies in South Africa nowadays.

As seen, the recession in sales of critical illness cover in South Africa may be considerable. The MME may be offering more advantages than critical illness cover. But the sales of critical illness cover may not stop here. Insurers may soon come up with a design that could divert attention once again towards critical illness cover.

Critical Illness Insurance, Insome Protection Insurance, Life Insurance Cover, Mortgage Payment Protection

The creditor critical illness cover appeared in the Canadian insurance market during the year 1997. This type of critical illness cover may have then been combined to mortgage protection insurance. Canadian dollar 12 million may have been recorded during the year 2000, accounting for premium amounts due to creditor critical illness cover. This amount may have represented a 100 percent increase in premium value since the year 1997.

However, there may be certain things to remember related to critical illness insurance in Canada as compared to more successful markets like UK and South Africa. The premium payment rates in Canada offered by association, group or creditor critical illness may be non cancelable for the life of the policy. This can be an advantage for the critical illness policyholder. But from a reinsurer’s point of view, this can be an additional risk as the premium values may be normally high.

Furthermore, similar to the early times in the UK, critical illness definitions in Canada had not already been standardised. Competition over the market had made companies to lower their prices and simplify their definitions. From a marketing point of view, this could be a definite advantage. But at the moment a policyholder makes a critical illness claim this could cause a problem. It could even lead to customer dissatisfaction. The reason behind could be that the claims department would find it difficult to understand the softer definitions.

Additionally, gradually Canadian insurance companies may have started to provide cover for much more critical illness conditions. The first appearance of individual critical illness insurance saw companies cover around 10 critical illnesses. This may have helped them compete in the insurance market. Nowadays, many policies may cover for up to 20 critical illness conditions. The group market however, followed a different trend. Fewer critical illnesses, meaning less exclusion built the policy. In essence, the creditor critical illness policy covered three major conditions: cancer, heart attack and stroke. Having a simple policy meant easier marketing and presentation of the product. Hence the critical illness policy may have been easily explained to people willing to buy the policy. Fewer exclusions may have comprised the policy as compared with a policy which covered up to 20 critical illness conditions.

Moreover, insurers started to see the fact clearly that benefits paid to customers had a solid importance for them. People may regard value added services as a definite advantage apart from critical illness claims already paid out. Therefore, insurers may be working on the fact that these surplus services be offered after the lump sum had been awarded. These services may turn out to be independent specialist or physician intervention. Other services may include referral to a specialist as per the critical illness sufferer condition. On the other hand, if the claimant wishes to be treated abroad, the insurer may organize travel facilities and also payment guarantees.

Critical illness cover may have yet to prove its success in Canada. The growth of the market is set to increase during the coming years as per recent reports. The fact that most business owners and ageing people possess critical illness cover in Canada can mean that the product may be not within the reach of every people. So, if a solution could be found for this, we could see the Canadian market explode under a soaring want for critical illness cover.

Critical Illness Insurance, Insome Protection Insurance, Life Insurance Cover, Mortgage Payment Protection

Likewise to the USA and the UK, the process of integration of critical illness cover in the Canadian market had been slow. But the Canadian life industry expects to see critical illness insurance be as successful as in the UK during the coming years. Let’s have a look at how critical illness cover developed in Canada.

The agency field force could be held responsible for promoting critical illness cover sales in Canada. The agency field force may also consist of agents, brokers and associates. The popularity of group critical illness cover or employer sponsored critical illness cover may be increasing in Canada. Thus, individual critical illness covers may be left behind during the process. Also, the worksite marketing may have also accounted for some critical illness cover sales in Canada. As the term critical illness cover may become more familiar to Canadians, insurance companies believe that sales could be made by direct response programmes in the future. Besides, the internet may also act as a powerful means to attract potential consumers due to the growing maturity of the Canadian insurance industry.

Munich Re, 2000 may affirm that critical illness cover sales in Canada may not have depended on specific people of specific sex and age groups. Therefore, policyholders may range from young to old, men to women and small business owners to professionals. However, one trend had been noticed. More critical illness cover sales may stem from people who are high earners. One possible explanation to this fact could be that critical illness policies may be relatively expensive, thus hardly affordable by low earners. The high price tag of critical illness policies may be due to the fact that the policies may last for a lifetime. Further reports may also reveal that critical illness policies may have more women buyers than men. Around 40 percent of women may possess a critical illness cover as most business owners could be women in Canada.

Furthermore, standalone critical illness policy may have been the first plan initially introduced in Canada. Soon, the combination of critical illness cover to disability and life insurance made way. Nowadays, insurers may be aiming at providing a critical illness cover which can compete effectively by providing more benefits to consumers. Some had chosen to accelerate the death benefit of a life policy upon diagnosis of a critical illness. Other companies might also be moving towards giving limited critical illness coverage on a guaranteed issue basis. Another option added on critical illness cover may have been the ROP (Return of Premium). With critical illness policies holding this option, it could be made clear that the advantage with that policy could be significant.

Some companies had the ROP automatically added to their policies as a rider benefit. Meanwhile, other companies may refund the premiums if the policyholder did not encounter any critical illness until the end of the policy. Other firms may also provide their customers with the ROP on lapse benefit which may have refunded the premiums once the critical illness policy had been ceased. Some people view this option as misleading as companies may be in fact encouraging their policyholders to terminate their policy ahead of time.

Critical illness cover in Canada appears to be on the same path as in the UK. As sales may be relatively lower than that in the UK, critical illness cover in Canada is yet to completely bourgeon.

Critical Illness Insurance, Insome Protection Insurance, Life Insurance Cover, Mortgage Payment Protection

Critical illness cover first made its appearance in South Africa during the year 1984. At that time critical illness cover was a merely raw product. The insurance market had yet to propagate the product and people did not know about it. As time passed by, critical illness cover became an important type of insurance policy as sales started to be considerable. At first few critical illness conditions were covered. But gradually insurers started to add more to the policies so that they could compete effectively in the market. So, let’s have a look at how critical illness cover evolved from 1984-1994.

Additionally the critical illness claims had been researched. As far as women are concerned, the critical illness claims concerning women had also been recorded. Around 9 claims may have been made by women aged 20-24, 28 aged 25-29, 37 aged 30-34 and 51 aged 35-39. So far, if compared to men, women might have made less critical illness claims. The claimed values continue as follows. Approximately 57 critical illness claims could have been made by women aged 40-44 followed by 39 aged 45-49, 19 aged 50-54 and finally 9 aged 55-59. If the results are looked at carefully, one could notice that the critical illness claims have been decreasing down the years.

Moreover, the claim experience among people of different ages had also been researched by the Continuous Statistical Committee: Dread Disease Investigation 1991-1994. The results that would be demonstrated had been taken between the years 1991 to 1994. Around 19 claims had been made by men aged 20-24, 50 aged 25-29 and 92 aged 30-34. More critical illness claims may have been more likely made by men. About 151 critical illness claims could have been made by men aged 35-39, 207 aged 40-44, 168 aged 45-49, 129 aged 50-54 and finally 54 aged 55-59.

Only three companies may have participated in the research carried out as seen above. Their total number of critical illness claims may have been around 880 from 1991 to 1994. It was therefore difficult to analyse the critical illness claims by cause or even smoker status. The actual critical illness claims for men may be around 70 percent in the first policy year compared to the claim ratio of policies older than a year. The same thing may also apply for women.

Furthermore, according to Munich Re, 2001, in the year 1984, 53 percent of people may have suffered from a critical illness like heart attack followed by 8 percent for coronary artery bypass. Additionally, around 10 percent of people may have also suffered from a critical illness such as renal failure or stroke while 29 percent may have contracted a critical illness like cancer. In the year 1994, a relative decrease in heart attack patients may have been recorded. Around 39 percent of people may have contracted heart attack whilst 9 percent may have suffered from coronary artery bypass. An additional 5 percent may have been patients of renal failure and stroke followed by 12 percent for other critical illness conditions and finally 37 percent may have been victims of a critical illness like cancer. In these ten years, the rate of heart attacks had decreased while the rate of cancer had increased.

As seen, critical illness cover in South Africa soon developed into a mature market. Appropriate claims data could have been obtained so that incidence rates could be analysed. This may have then enabled known firms to predict the trend in the future. Nowadays, the critical illness claims data may be much complex and accurate as more incidence rates may have occurred.

Critical Illness Insurance, Insome Protection Insurance, Life Insurance Cover, Mortgage Payment Protection

The root of critical illness insurance lies in South Africa. Critical illness cover became a must as the health care system at that time in South Africa could not cope with the costs for critical illnesses. The idea stemmed from a discussion between a surgeon and the chief executive of a life office. Since then critical illness cover in South Africa had been one of the most prolific markets around the world. Let’s have a look.

Furthermore, the first critical illness policy launched provided cover for around 4 main critical illnesses. These could have been heart attack, stroke, cancer and coronary artery bypass surgery. As time passed by and a more mature market started to unveil, the insurance companies started to provide cover for 5 critical illness conditions. Nowadays many companies in South Africa may be providing cover for more than 20 serious illnesses. As per O’Mahony S, 2001, “South African dread disease report”, most companies may cover up to 8 core critical illness conditions and 21 extended conditions. Extended cases may be surgeries like balloon angioplasty or states of health such as total and permanent disability.

Additionally, as per Munich Re 2000, at the time critical illness cover was firstly launched nearly all policies may have been riders to life insurance. The highest amount paid as lump sum at that time may have been around R 25,000. This value may have been chosen in accordance with the cost of one of the most serious critical illness conditions at that time, thee coronary artery bypass graft. Nowadays, the maximum amount of cover paid as lump sum could be around R 550,000. On the other hand, bigger companies may offer around R 800,000. Furthermore, during the year 1990, critical illness cover sales may have been estimated to be higher than any other covers. The reason may be because about 60 percent of critical illness covers may have been sold as riders to other policies. But the recent sales may be decreasing as it may now represent a recession of around 50 percent as compared to the year 1990.

In addition to, critical illness cover may have a high price tag in South Africa. So, two departments exist that perform the critical illness cover sales procedures. These could be the life office agents and the brokers. The life office agents sell critical illness cover to people who have a low income. Meanwhile, the brokers sell to those people who earn a high income at the end of the month. Due to many high income earners, most critical illness sales could have come from the broker market.

According to Munich Re 2000, there may be around 14 life insurance companies that provide cover for critical illness. This could represent around 70 percent of all life insurance companies in South Africa. Practically all life insurance companies have ceased to offer standalone critical illness covers as it may have been rather slow concerning sales. Critical illness cover may most of the time be sold as riders, especially mortgage, similar to the UK and Canada.

The maturity of the South African insurance market has already been reached. But as people gain more knowledge about critical illness cover, there could be even more critical illness cover sales. The UK and the Canadian market, though high amount of critical illness cover sales recorded may yet to become as mature as that of South Africa.

Critical Illness Insurance, Insome Protection Insurance, Life Insurance Cover, Mortgage Payment Protection