The Canadian Life and Health Insurance Association (CLHIA) has published its annual report on the industry’s activities, including claims paid, premiums collected, the coverage Canadians have on average and even how much in taxes the industry has contributed to federal and provincial coffers.
In 2020, they say the industry was resilient in the face of significant travel insurance claims, an increase in psychology-related claims, and other pandemic related stresses.
Stephen Frank, the CLHIA’s president and CEO states that the industry proactively provided premium reductions and deferrals to protect workplace drug and health benefits, while investing in online solutions for those seeking virtual and timely access to their benefits. “Because of actions taken by insurers, employers and other plan sponsors, over 26-million Canadians benefited from access to health benefits at the end of 2020 – the same as before the pandemic,” the CLHIA said in a statement to announce the publication of its report.
According to the Canadian Life & Health Insurance Facts report, Canadian insurers paid out $154-million in individual and group life insurance claims from deaths related to COVID-19. The industry also paid out $950-million in travel insurance claims, and saw a 24 per cent increase in psychology claims during the year, reaching $420-million in 2020.
All told, they add that Canada’s life and health insurers cover more than 29-million Canadians. The industry paid out $97-billion in benefits in 2020. Overall, 22-million Canadians own $5.1-trillion in life insurance coverage. The average life insurance protection per household in Canada is $442,000, up from $432,000 in 2019.
Insurers collected $123-billion in premium revenues during the year. “This was led by life insurance, up 3.3 per cent; followed by annuities (including segregated funds), up 1.9 per cent’ and health insurance, down two per cent,” says the report.
“Insurers process hundreds of millions of claims annually. Only about one in every 100,000 claims results in a complaint,” the CLHIA underlines.
The report also examines the industry’s role in pensions and retirement solutions and the tax insurers collect and contribute – 50 per cent of total tax contributions are premium-based taxes.
“Canadian life and health insurers contributed over $8.2-billion in taxes. In 2020, insurance companies’ contributions to Canada’s tax base included $2.7-billion paid to the federal government and $5.5-billion paid to provincial/territorial governments. Of the total, $4.3-billion was borne directly by insurers and $3.9-billion was collected and paid as provincial sales taxes on life and health insurance and as employees’ share of payroll taxes.”