COVID-19 Is Increasing Individual Life Claims, Too: Analysis

“The Individual Life COVID-19 Project Work Group would like to stress that, due to delays in the reporting and recording of claim information in the insured data, the more recent data submitted for this research is considered preliminary and will change with subsequent data submissions,” the analysts write in a section on the analysis limitations.

Why It Matters

In typical years, life insurers’ mortality forecasts are close to the actual experience.

The COVID-19 pandemic has led to a sharp increase in group life claims. OneAmerica suggested that, in the fall of 2021, group life mortality was running about 40% higher than normal. The odds that any given insured worker would die were still low, but much higher than in the period from 2017 through 2019, before the COVID-19 pandemic began.

One open question has been whether the pandemic has affected people with individual life insurance, who tend to have a higher average income and go through a medical underwriting process, nearly as much as it has affected group life insureds.

The authors of the new analysis have produced figures suggesting that the pandemic-driven increase in the number of individual life claims has been lower than the increase than the number of group life claims in some quarters but higher in other quarters.

The Numbers

Here’s what happened to the number of group life and individual life claims in the data the work group analyzed, when compared with the averages for the period from 2017 through 2019:

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