Disability claims soar

Clement Chinaka is the managing director of Old Mutual Corporate. (Picture: Supplied)
Clement Chinaka is the managing director of Old Mutual Corporate. (Picture: Supplied)

In recent years reinsurers and assessors witnessed a drastic shift in disability claims from physical injuries to stress-related illnesses and psychological issues.

According to Old Mutual Corporate, the work environment has changed and so have the risks to health, with 47% of South African adults – double the global average – leading sedentary lifestyles.

Not only does technology keep us connected 24/7, but we sit for far too long at our desks, in meetings and in cars. We are also living in stressful environments with work, politics, the economy and finances as aggravating factors.

Managing director of Old Mutual Corporate Clement Chinaka says that between 2011 and 2016, the number of disability claims increased by 50% in the heavy industry sector, 30% in the medium industry sector and 130% in the light industry sector, which is signified by office jobs.

“As we transition to the fourth industrial revolution, we are likely to see more claims coming through the market compared to what we used to see in the mechanised production world,” says Chinaka.

He explains that disabilities were more physical in the latter and becoming increasingly mental in the former, with surges in psychological, muscular-skeletal and stress-related illnesses.

Old Mutual set out to monitor these changes and how they impact their clients and employees. The 2017 Corporate Disability Monitor, launched earlier this month, sought to learn more about disability and its risk cover.

A hundred corporates, 35 intermediaries, four reinsurers and 14 assessors’ perceptions were surveyed for the study.

43% of the study’s respondents agreed that there was a change in the nature of disability claims in the last year. Of the respondents, 70% cited poor lifestyle as the primary cause of the increased claims, 54% attributed it to stress in general and 39% pointed to psychological issues.

The state of the economy has also contributed to higher disability claims, with 41% of them indicating financial stress as the key contributor to psychological stress when asked why members are more likely to claim during periods of lower economic growth.

With such periods forecast to linger and the world of work constantly changing, Old Mutual recommends refining disability cover to stay relevant and sustainable.

“The most impactful way to keep disability cover premiums more affordable is to focus on prevention and rehabilitation, so that those who are disabled can return to work sooner,” Chinaka says.

In order to manage the overall increase in disability claims, Old Mutual recommends corporates be more involved with employee health, realise that wellness is not only physical but also mental, have early detection and intervention processes in place and provide access to medical facilities.

They added that employers can introduce wellbeing initiatives, ensure that empolyees take enough leave, proactively identify employees at risk of burning out and try to limit after-hours work-related communication to minimise work-related stress.

Employees are also encouraged to personally take charge of their wellness by taking breaks throughout the day, not eating their lunches at their desk, speaking up and getting help if they feel overwhelmed and only work overtime when necessary.

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