18 June 2015
- IFoA research finds claim notifications tripled in 3 year period
- Currently takes average of 17 months to settle typical claim
- Only 28% of awards paid actually going to the claimant
The Institute and Faculty of Actuaries (IFoA) welcomes the report on Noise Induced Hearing Loss Claims, published Tuesday (16 June) by the Association of British Insurers (ABI), which confirms previous findings by the Institute and Faculty of Actuaries’ (IFoA) Deafness Working Party. The IFoA report found that between 2010 and 2013 claim notifications tripled - from 27,600 to 85,800.
Research by the IFoA suggests that the existing claims system does not appear to be designed to accommodate the complexity of current deafness claims, which can involve multiple defendants and therefore multiple insurers. As a result of the complexity, it currently takes around 17 months to settle a typical deafness claim. The IFoA research suggests a number of areas that should be explored in order to improve these timings, such as:
• a simpler deafness claims process;
• development of an agreed objective standardised test to assess deafness;
• establish a panel of independent hearing loss experts;
• the potential for the Claims Portal to deal with multi-defendant claims;
• the introduction of fixed legal fees for industrial deafness claims similar to personal injury motor claims.
Nick Salter, President of the IFoA comments:
“The ABI report makes interesting reading. It is clear that spurious workplace deafness claims could drive up the cost of insurance for business customers. Solutions need to be found to address the vast increase in the numbers of claims and improve the claims management system. The ABI policy proposals will generate discussion between all interested parties, including actuaries, about how the challenges could be grasped.
“Previous IFoA research which fed into the ABI report shows that despite a dip during 2014, the overall trend has seen a significant increase in claim notifications over recent years. Additionally, the IFoA research found that only 28% of claim awards paid actually goes to the claimant, which mirrors the ABI’s findings. This high level of expenses suggests the system is completely out of kilter. Further investigation into how the system can be improved is clearly in the public interest.”
~ENDS~
Download the IFoA's UK Deafness Working Party paper. For further comment or to answer any questions that you may have, please contact Annette Heninger, Media Relations Manager at the IFoA, on 07525 592 198 or by emailing annette.heninger@actuaries.org.uk
Editorial notes:
1. The IFoA UK Deafness Working Party will be releasing updated research in the Autumn.
2. About the Institute and Faculty of Actuaries
- The Institute and Faculty of Actuaries (IFoA) is a royal chartered, not-for-profit, professional body.
- Research undertaken by the IFoA is not commercial. As a learned society, research helps us to fulfil our royal charter requirements to further actuarial science and serve the public interest.
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- Members of the IFoA have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyd’s.
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