Aviva has declared that it will reimburse eligible UK private health insurance consumers £81m, in order to fulfil its Covid-19 Pledge.
The amount represents Aviva’s most recent estimate of the difference between predicted claims costs and actual claims costs for the claims period under review, which runs from 1 March 2020 to 31 December 2022. It includes some treatments and operations that were postponed rather than cancelled.
Individual and SME customers will each receive a payment equal to around six weeks’ worth of their yearly premium. Individual customers will get a payment equal to about seven weeks’ worth of their annual premium. For large corporate clients, compensation will vary between schemes depending on each scheme’s claims experience.
The Covid-19 Pledge was extended by Aviva last October to the end of 2022. The insurer stated that they expected it to take longer for claims for postponed treatment that would have otherwise been made during the pandemic period to materialise.
Ongoing analysis by Aviva currently shows that the claims catch-up has been slower than projected and paired with the current strains on UK household finances, Aviva has judged that a payment sooner in 2022 gives the best outcome for clients.
Payments will not be subject to the potential increase that was indicated in the October update as the payments are now being made within the initial Pledge term, rather than being deferred until 2023.
As stated in the Pledge, consumers and clients who paid a premium during the period 1 March 2020 to 31 March 2021 will be entitled for a payout, even if they no longer hold a policy.
In accordance with the Covid-19 Pledge, Grant Thornton UK LLP independently examined Aviva’s strategy. Over the next few weeks, Aviva will get in touch with brokers and their clients to inform them of the payouts.
Aviva will continue to monitor claims until the end of the year and if any further payment is made in 2023, this will include a 20 per cent increase.
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