CLHIA-ACCAP

18 The death benefit payments to beneficiaries of Canadian life and health insurance policies totalled more than $6.5 billion for the year, compared with $4.5 billion a decade ago. Of the total, death benefits under life insurance policies accounted for almost $6.3 billion, including additional benefits paid on a policyholder's accidental death as provided in some life insurance policies. The remainder, $257 million, was paid out under comparable benefits provided in health insurance contracts as Accidental Death and Dismemberment or Personal Accident coverages. Individual policies accounted for 60 per cent, or almost $3.9 billion, of the total death benefit payments. Payments to beneficiaries under group contracts totalled over $2.6 billion. Group insurance has fallen as a proportion of total death benefit payments compared to 2004, when they accounted for 45 per cent. Based on a special CLHIA survey, an analysis of one month's death benefit payments under life insurance policies in 2009 shows that: ■ ■ most claims are on policyholders over age 65 at death (67 per cent). ■ ■ immediate family members receive most of the death benefits (72 per cent). ■ ■ almost all payments (over 99 per cent) to beneficiaries are taken in a lump sum. ■ ■ almost half of the individual claims (47 per cent) were for policies issued over 30 years ago. ■ ■ one of every three claim dollars was paid under individual policies less than ten years old. ■ ■ more than half of the payments (56 per cent) under individual insurance were on whole life policies. ■ ■ one of every ten individual life claims was on substandard or extra-risk policies. Payments to living policyholders In 2014, more than nine out of every ten dollars made in payments by life and health insurers went to living policyholders. These were paid out as annuity and disability benefits, reimbursement or payment of health care costs, dividends to policyholders, cash surrender values and matured endowments. These payments totalled nearly $77 billion in 2014. Over the last couple of decades, the growth in annuity benefits has resulted in an increasing amount of benefits being paid to living policyholders. During 2014, annuity payments increased 17.5 per cent to record levels of $41.5 billion, making up half of total benefits for the year. This is comparable to the 45 per cent level of a decade ago. Total benefit payments by insurance providers to Canadians under health and disability products (insured and uninsured) rose 3.3 per cent to over $30.9 billion during 2014, about one and a half times the 2004 payments. Benefit payments under group health and disability products accounted for 94 per cent Sources: OSFI, CLHIA Includes payments under uninsured contracts administered by life and health insurance providers Total Policy Payments by Region – 2014 Atlantic provinces 6.1% British Columbia 10.9% Quebec 20.0% Prairie provinces 16.4% Ontario 46.6%

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