simplebloggertutorial - Clinical staff take a patient out of an ambulance, amid the spread of the coronavirus disease (COVID-19) pandemic, outside the Royal London Hospital, in London, England, January 17, 2021. BETWEEN/REUTERS/Toby Melville.
We've been trying as a company to come up with a strategy on this modeling and have made progress but it's far from a 'crystal ball' that could predict this
LONDON (ANTARA) - Several global life insurers are taking steps to contain payments stemming from the coronavirus pandemic, including long-term health risks that are not yet fully understood, industry sources told Reuters.
Life insurance companies, including Prudential Financial Inc and Aviva PLC, are currently implementing a waiting period before COVID-19 patients, including those who have recovered, can apply for coverage, spokespeople and executives said. Some limit the scope to a certain age range.
This shift came about because several reinsurance companies asked for new protection from the life insurance companies they stopped, and when the industry was trying to determine the extent of the problems caused by COVID-19.
COVID-19 has killed more than 2.1 million people worldwide and contaminated nearly 100 million, according to a Reuters tally.
Some victims suffer from long-term risks including chronic respiratory problems, organ damage, circulatory problems, acute fatigue, and blood loss. Three weeks after reconditioning, 10% of COVID-19 patients remain unwell and up to 5% are in pain for several months, according to researchers at King's College London.
The pandemic has resulted in critical psychological health for those unable to say goodbye to loved ones or have been isolated for several months, while exacerbating substance abuse problems for others.
It's too early to know how many people will file claims for death, long-term illness, or disability as a result, but insurance companies fear the risks could last for decades.
"We've been trying as a company to come up with a strategy on this modeling and have made progress but are far from a 'crystal ball' that could predict this," said Optimum Re Insurance Co's Chief Clinical Director, Dr Paulo Bandeira Pinho.
Optimum has met with loyal life insurance customers, including Prudential Financial, to map out long-term risks and financial impact opportunities.
Prudential is currently enforcing a minimum waiting period of 30 days for recovered COVID-19 patients.
"Ultimately, many long-term implementations of the pandemic have yet to be met," said Prudential's vice president of operations Keith Bexell. "As long-term impacts become more understandable, our approach to underwriting can be aligned as necessary."
Since April British life insurer LV= has suspended the program for anyone diagnosed with COVID-19, experiencing symptoms, or living with someone who is sick, according to underwriting regulations on its website.
Aviva PLC imposed a "short" suspension for those with COVID-19 or similar symptoms for the last 30 days, a spokesman said.
Life insurance companies were in the business of hedging risk decades earlier. Since the start of the pandemic, the industry has explained it's unlikely to result in huge financial losses, in part because they haven't seen a rise in claims.
Global data are not available for 2020. In the United States, 8% of group life insurance claims filed from April to August attributed the cause of death to COVID-19, according to the US Society of Actuaries.
The company told Reuters that the effect has been minimal so far - with LV = seeing COVID-19 affect only 2% of programs and Aviva still covering more than nine out of 10 customers - but they are still taking countermeasures because of the long-term risks.
In addition to those who suffer from the disease, Optimum Re's Pinho fears "a wave of widows and widowers, children and parents" with shorter life spans.
In addition, the pandemic has reduced protective health screenings, creating another set of risks, said SwissRe's Head of Life and Health Underwriters for America, Chris Behling.