Insurance Association of Jamaica (IAJ) is reporting a significant increase in claims on life insurance policies for the first nine months of 2021, when compared to the corresponding periods in 2020.

According to the IAJ, “Death Claims on individual life policies for the period January to September 2021 were up 76 per cent on the corresponding period in 2020. This is significantly more than the nine per cent increase in death claims during the same period 2020 over 2019 and 19 per cent hike in death claims for 2019 over 2018.”

Back in November last year, Jamaica’s two largest life insurance providers, Sagicor Life Jamaica Limited and Guardian Holdings Limited, informed Jamaica Observer that they have recorded increases in claim payments on life insurance policies up to September 30, 2021. Both companies credited this to a rise in mortality in Jamaica, though, at the time, figures from both the Statistical Institute of Jamaica and Registrar General’s Department showed a downward trend in deaths.

The IAJ said while it is analysing the data to identify reasons for the jump, an initial assessment of the data indicates the impact of COVID-19 on policyholders. In addition, the umbrella association also recorded an increase in insurance subscriptions with take-up from young people contributing to the uptick.

“On the sales side we have seen a 13 per cent improvement in new annualised premium income, a 23 per cent jump in new sums assured, suggesting that more younger persons are buying life insurance now while the overall eight per cent more new policies were sold during the period under review. Generally, our observation is that the onset of the COVID 19 pandemic has heightened the awareness of the need for persons to get insurance protection given risks of ill health and death they see around them,” the IAJ explained to the Business Observer.

In terms of motor vehicle claims, the association said insurance companies paid out $11.7 billion to policyholders for January – October 2021, reflecting a 10 per cent increase over the same 10-month period in 2020. There were 38,604 claims on motor vehicle insurance, three per cent more than in the year prior.

“The industry had anticipated less claims in 2021 given the curfew hours and lockdowns instituted by the Government, and in fact many insurance companies made concessions in the premium rates charged anticipating a reduction in motor claims,” the IAJ said.

Quoting figures from Road Safety Unit of the Ministry of Transport and Mining, IAJ pointed out an 11 per cent spike in road fatalities in 2021, “with one-third of these…occurring during curfew hours. Driver behaviour has a huge impact on motor vehicle claims.”