Sanlam says its life and savings business paid more than R14 billion in death claims in the first 10 months of this year alone.
The insurer, which published its operating update on Wednesday, said most of these claims resulted from the third wave of Covid-19 infections, which peaked around July.
“Significant excess mortality claims were recorded in the South African and Emerging Markets operations,” wrote Sanlam in the trading update.
It said the more than R14 billion in gross mortality claims that Sanlam Life and Savings paid in the ten months to 31 October represented an 88% increase compared to claims paid over the same period in 2020.
By the end of October 2020, South Africa had already passed the peak of the first wave of Covid-19 infections. But in the current year, it has dealt with two successive waves, and the peak of the fourth wave is approaching.
Insurers did say after the second and third waves that those affected the insured population more than the first wave.
By the end of June 2021, Sanlam said it had already paid R22 billion in death claims since the bedding of 2020.
Sanlam said there was R3.42 billion in claims after its reinsurance payout over and above its long-term expected level in the Sanlam Life and Savings business. There was R536 million in claims above the long-term expected level within the Sanlam Emerging Markets cluster.
The Sanlam Life and Savings business released discretionary reserves of R2.85 billion to mitigate the impact of those excess claims. The group said Sanlam Emerging Markets holds more limited discretionary reserves and will therefore only consider releasing any money at year-end if needed.
Despite the high level of death claims, Sanlam said it was still a good year operationally.-fin24
