Recently, on 14 June 2022, we held our much-anticipated annual Sanlam Benchmark.  For over 40 years, the Sanlam Benchmark research has enabled retirement funds, employers and intermediaries to empower their members to live and retire with confidence.

The Sanlam Group Risk (SGR) team addressed the audience on topics that are currently top of mind in the industry.  This year, the most pressing concern focused on was the protection of our current and future health and financial states.

Michele Jennings, Managing Executive of Sanlam Group Risk, together with Gary Allen, Chief Executive of Sanlam Health Solutions, delved deeper into the reasons for the increased mortality experienced.  They discussed the impact of non-communicable lifestyle diseases, deferred or avoided treatments during the pandemic, and unavailability of specialists (among many other causes) that contributed to the overall mortality experience recognized.

In the supporting research they found the following regarding the impact of lifestyle on diseases:

  • the impact of lifestyle-related diseases is often detected too late to prevent the serious consequences that follow, e.g. from advance hypertension and diabetes;
  • many of the triggers contributing to mental illness are lifestyle related, with financial stress being one of the largest contributors; and
  • back-and-neck pain is a major cause of claims in insurance, and effective and early management can significantly improve a member’s experience, to the extent that hospitalisation can be avoided.

They note that “Fifty-one per cent of the Benchmark respondents indicated that they believed a holistic health and financial wellness programme delivered higher productivity and staff happiness, yet only 12% used integrated programmes – reflecting a clear gap in the current services offered.” To read more on how lifestyle choices drive diseases and how effective disease management can assist both the member, the employer and the insurer, click here to read the whole article.

Because the holistic health of a person is becoming a topic of significant importance, Neil Cilliers, Head of Sanlam Group Risk Actuarial, explores the impact of the lockdown (of the past 2 years) on all facets of our lives, particularly the societal and economic parts.

According the Neil, information from the SGR Disabilities teams indicates that stress, anxiety and depression claims are on the rise.  “Employers and insurers who offer Wellness Programmes are becoming more sought after as we seek to help our employees and our clients to navigate the stresses of the past year as well as the new stresses emerging.  The WHO has identified mental health as one of the key health services during and after the pandemic, and member states and organisations have recognised the need to scale up mental health support infrastructures as part of an overall health response”, reflects Neil.  But is South Africa’s public sector health system geared up for this fight?  Click here to read the whole article.

Reinier van Gijsen, Head of Sanlam Group Risk Pricing, contemplates the rise of income disability (PHI) benefit experience and premium rates. 

According to Reinier, “the market collectively failed to adhere to sound risk principles” as a result of pressure from intermediaries and competitors.  He states that, “all the protection and cost containment mechanisms have systematically been thrown out of our ‘house”, resulting in “PHI premium rates slowly starting to increase and, as more controls were tossed out, this lift continued and even accelerated.”

Considering the increase in stage 2 and stage 3 cancers and the March 2022 report by the WHO indicating a sharp rise globally in mental health diseases, Reinier warns that PHI rates getting to the same level as members’ employee fund contributions, are not sustainable in the long run. Click here to read the whole article and Reinier’s  call for all stakeholders – insurers, advisers, clients and members – to rethink the future of what the income disability insurance product should look like, while managing the ever-increasing risk.