Another way of looking at insurance?

The trouble with insurance is two-fold. No one wants to spend money on something they may never need and no one wants to think about the outcomes they are insuring against. Death and illness, accidents and injuries, misery and pain. Who wants to take their mind through those doors when looking out onto their own life’s horizon?


And yet... we have to. Because, death and illness do strike, accidents and injuries do occur, and misery and pain do make themselves felt. Insurance cannot prevent any one of these from happening, but what good cover can do is alleviate the financial burden that besets such outcomes.

Reading the latest statistics from Scottish Provident is what’s forced me to concentrate on this whole area of financial planning. The company’s report on claims made on life insurance policies for the last year show that the average age of claimants was just 56. So much for the national preoccupation with the notion we are all living on to a ripe old age. Digging deeper into these figures, the detail gets more sobering. Nearly one in five claims (18%) paid out were for policyholders aged just 44 or under, a further third (32%) were aged between 45 and 54 years old. The total paid out over 2011 was £41,863,503 in life cover claims with the average claim amounting to £84,744.

Critical illness insurance is another area which expatriates are urged to include in their financial planning. Looking at what Scottish Provident paid out in the first half of last year, we see that the average payment made to claimants was £81,434 with the largest just over £945,000. The age of the average claimant was 47 years old. Scottish Provident says that during this half year, it paid out over £30m for cancer claims, with these accounting for 65% of the total claims paid. Nearly £7m was paid out for heart attack claims, with these making up 13% of all claims.

I’m not relaying this information in order to scaremonger. But the information does shine a light on a corner where a premature death and illness will cause grief and sorrow, but doesn’t have to tell a story of financial hardship.