Swiss Re is calling on Australia’s insurers to adopt a multi-faceted approach to claims management to help more claimants return to work.
The reinsurer said it hoped to encourage the life insurance industry to promote the health benefits of returning to work, in particular around the area of rehabilitation in claims management, which has been shown to help post injury recovery.
Swiss Re cited a study by workers’ compensation specialist, Employers Mutual, which found that once an injured worker is off work for 4-12 weeks, he or she has a 10-40% risk of still being off work at one year. After 1-2 years absence, it is unlikely the person will return to any form of work in future.
“What we would like to see is more focus on getting people back to work to recover, or ‘back to life’. This requires support from the industry through day-to-day rehabilitation case management, product design and projects targeting specific conditions such as mental health,” said Helen Troup, Swiss Re’s Head of Life & Health, Australia and New Zealand.
After 1-2 years absence, it is unlikely the person will return to any form of work in future
Swiss Re said a focus on best health practices that assist injured policyholders recover fully and return to health and work, would likely see the insurance industry join the upward trend currently being observed in workers compensation return to work rates. As reported in the National Return to Work Survey, conducted by Safe Work Australia, the nation achieved ‘durable growth’ in return to work rates over the past year, with rates increasing from 75% in 2011-12 to 77% in 2012-13.
To aid insurers to deliver innovative return to work solutions, Swiss Re’s Australian Claims team is set to publish a white paper in early 2014, which will explore rehabilitation trends and the ongoing role of rehabilitation in claims management.
The reinsurer is also partnering with the Australasian Life Underwriting and Claims Association (ALUCA) to launch the Excellence and Innovation in Rehabilitation Award, which aims to recognise such initiatives from within the insurance market.
“We hope to encourage the life insurance industry to join the upward trend we are seeing in workers compensation return to work rates and assist in finding better outcomes for Australians,” Ms Troup said.
Entries for the Excellence in Innovation in Rehabilitation Award are now open. Click here for more information.
Swiss Re are the most difficult reinsurer for long term IP claims. They have a long history of denying legitimate claims and forcing claimants to settle for reduced payments. Legal action is the path of choice once it appears Swiss Re have a long term claimant. I am sure Helen would be happy to provide more information on the % of IP claims that are declined or settled. Rehabilitation is important, but so to is honouring the terms and conditions of the contract. I wouldn’t recommend placing a client with any life company who uses Swiss Re. I believe Advisers should understand better the practices of the reinsuer holding the risk as much as they review the policies terms and conditions. Despite what life companies say, when the risk is shared with a Reinsurer, they will always be subject to their claims procudures. Finding out at claim time is a difficult business practice.
Patrick said:
“Rehabilitation is important, but so to is honouring the terms and conditions of the contract.”
I couldn’t agree more, Swiss Re your approach to legitimate long term claimants is a disservice to a wonderful industry that so many work tirelessly to enhance.
Well said Patrick.
The challenge to utilising rehabilitation as a strategy to return people back to work (is a well intentioned an sensible strategy) is that there is no contractual requirement for the claimant to engage in such programs. Workers Comp have leverage in this area.
In the main, DI benefit type contracts have not been devloped on the premise – that the insured must engage in rehab – they only need to meet the defintion of disabiliy. If somone does not engage are they; a malingerer, dishonest, a fraud – NO. Rehabilitation is generally not a policy condition.
The challenge is – if insurers amended the defintion to mandate rehabilitation, the underlying premise of the defintion of disability changes obtusely. As an industry are we trying to use ‘rehab’ to solve the woes of past product development? Product paradigm!!!!
This is one of the most important discussions we will all need to have.
When I started 27 years ago, retention was not an issue as clients had no where else to turn to.
If the current rate of premium lapses continues, then the whole Life Industry is in trouble.
Uninsurable clients who hold policies and those on claim, will keep their policies, which is nice, though unfortunately, they are not profitable due to the costs in claims.
Healthy clients can and increasingly do cancel their retail life policies to attain cheaper cover.
The facts are simple. The longer a client is on claim, the lower the chance is they will voluntarily go back to work if they are on long term benefits.
The most important time to start the process of getting a client back to work, is from day one of their claim.
The Life companies are pussy footing around and exacerbating the problem by not being upfront about their expectations of when the condition warrants the client to be thinking of their obligation to get back to work.
Don’t get me wrong, we have a 100% success rate with all our claims, though we do see a sausage machine claim processing mentality from nearly all the Insurers, that means clients can become institutionalised into thinking they must stay on claim.
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