As COVID-19 continues to spread worldwide, RGA is providing guidance on the consideration and adjudication of life and typical morbidity claims that may arise due to COVID-19.

Below we highlight a few key considerations for managing these claims.

Review and apply policy terms and conditions

The terms and conditions of insurance contracts are paramount in determining which claims are to be considered valid. Any change in terms; e.g., removal of pandemic exclusions or addition of supplementary benefits, should be considered together with pricing and business development colleagues.

Mortality claims

The current crude mortality ratio, according to the World Health Organization (WHO), is between 3% and 4%.i This is not final and will most likely undergo readjustment with time. (The crude mortality ratio refers to the number of reported deaths divided by the number of reported cases). Older-age individuals and those with underlying conditions are currently found to be at higher risk of suffering serious complications and death from COVID-19. A death claim related to COVID-19 in the absence of any applicable exclusion will be handled in the same way as other mortality claims.

Morbidity benefits

• Lump Sum Disability: given that most contracts require a total and permanent inability to perform occupational duties, claims related to COVID-19 for these benefits are not expected to be relevant. Most infections (80%) are mild. However, for those with more severe disease who survive, long-term consequences, such as possible chronic respiratory impairment, are yet to be determined.ⁱ
• Critical Illness (CI): defined events for the diagnosis of infectious diseases such as COVID-19 are not typically included in CI policies. The treatment of and intervention in serious cases may trigger consideration under a general event such as hospitalization and treatment in an Intensive Care Unit. Currently, 5% of infections are considered clinically critical, and require ventilation.ⁱ
• Disability income (DI): consideration under DI contracts, especially with a short deferred / waiting period, may be relevant, depending on the individual’s occupation and the severity of the clinical condition. Absence from and/ or inability to work due to the need for self-isolation or quarantine should be discussed with pricing colleagues to determine an appropriate response to these claims and should also be viewed against specific country policies with regard to statutory benefits. 

Recording of claims data

• To obtain a clear understanding of the impact of COVID-19 on the life insurance industry, it is crucial to accurately record the details of claim causes. Accordingly, RGA will be collecting weekly claims data on COVID-19 claims from all our local offices on this cause until further notice.
• The following ICD codes have been made available:

Conclusion 

The development and impact of COVID-19 is continuously changing, making the provision of guidance challenging. Please continue to refer to reputable sources such as World Health Organizationii or the Center for Infectious Disease Research and Policyiii for up-to-date information.

For specific questions and discussions of scenarios, please contact your local RGA Claims Manager or Marilda Kotze, Vice President, Global Head of Claims, RGA, at mkotze@rgare.com. 

i https://www.who.int/docs/default-source/coronaviruse/situation-reports/20200306-sitrep-46-covid-19.pdf

ii https://www.who.int/

iii  http://www.cidrap.umn.edu/news-perspective