OnePath Life has confirmed premium increases for existing policyholders with IP and TPD cover, effective from this month.
This confirmation of rates increases follows OnePath’s announcement in July of pricing changes for new IP customers.
In an explanatory brochure to its customers, OnePath says that:
- Income protection cover costs will increase by 25 percent
- TPD cover costs will increase by 12.5 percent
The insurer also notes these increases are in addition to any age or CPI increases and that they apply across both stepped and level premium contracts
In its message to its customers, OnePath explains that the industry is seeing more claims go for longer than it anticipated, largely driven by accident claims and mental health claims. It states that from 2014 to 2018:
- Accident claims costs have increased by 45 percent
- Mental health claims costs have by increased by 32 percent
OnePath adds that it had been due to review its pricing earlier this year but had “… held off on any increases since March 2020 and have absorbed losses given the challenges Covid-19 has brought us all”.
No insurer is immune
…eight of the largest life insurers in the country have increased their premiums over the last 12 months
The company says that no insurer is immune to having to increase prices. “In fact, eight of the largest life insurers in the country have increased their premiums over the last 12 months.”
It also outlines to customers that their cover is flexible and that there are various options and actions they can take to enable them to manage costs. These include:
- Decreasing the sum insured
- Decreasing the benefit period on the IP policy
- Increasing the waiting period on the IP policy
- Removing any extra-cost options that may not be needed anymore
- Switching from a fully featured cover to a cover with less features