In an update released to the market on Thursday, ClearView said while it had not observed material changes to new business applications, volumes or premium collections as a result of the crisis, it had seen an increase in clients requesting premium waivers in recent weeks.
A spokesperson for ClearView told ifa the insurer had agreed to waive premiums for up to three months for customers experiencing extreme financial hardship due to involuntary unemployment because of the coronavirus crisis.
The life insurer also noted it was proceeding with planned increases to income protection premiums later this month, which it said were necessary in line with recent adverse claims experience in the business line.
“It is too early to assess future experience and reaction to the rate changes in the current environment,” ClearView said.
“We are actively supporting APRA’s intervention to improve the sustainability of income protection products.”
The company also noted there were no pandemic exclusions in any of its life insurance products, and that its capital position “appears resilient” to both ‘plausible’ and ‘severe’ COVID-19 outbreak scenarios.
“Profitability can be very sensitive within each scenario, in particular to claims and lapse assumptions,” the insurer said.
“The COVID-19 epidemic will likely see an increase in claims and lapses in the months ahead that will have a negative impact on the ‘base’ (pre-COVID-19) case projections.
“It is too early to quantify any potential financial impact as it will be some months for the impact to be known.”
Additionally, the company announced that its board chair, Bruce Edwards, would retire on 30 June.
“It is proposed that current independent non-executive director Geoff Black will be appointed as chair,” ClearView said.
“The board, in consultation with the nomination and remuneration committee, is currently undertaking a market search for an appropriate new non-executive director and details will be notified to the market in due course.”
It’s a built in benefit (The Waiver of Premium While Involuntarily Unemployed Benefit) under the Clearview policy (and many other insurers’ policies). The benefit provides up to 3 months premium waiver while you are involuntarily unemployed (as suggested by the name) – whether as a result of COVID-19 or otherwise. It should be noted though that while premiums are being waived under this benefit, an insured would be unable to claim disability benefits for any arising sickness or injury during that period.