Category Life Insurance

Encouraging cancer cover through dialogue

08 July 2013 Nicholas van der Nest, divisional director of risk products at Liberty
Nicholas van der Nest, divisional director of risk products

Nicholas van der Nest, divisional director of risk products

Battling a severe illness is a life changing event which puts families under severe strain. Not only is there the emotional trauma that has to be dealt with during the struggle, but also the financial pressure that the illness puts on close family members

There is a belief in society that the majority of cancer is hereditary, and while this is somewhat true, isolated cases of cancer which have no historical bearing are being diagnosed every day. Added to this, although there is a perception that if you live a healthy lifestyle - you wont get cancer, the reality is that cancer can affect healthy people. According to the Centres for Disease Control and Prevention, each year, 12.7 million people learn they have cancer of which 7.6 million die from the disease.

This puts significant strain on short term insurers who have to increase their capacity in covering diseases such as cancer. Nicholas van der Nest, divisional director of risk products at Liberty puts this into more perspective.

Illness Context

For the remainder of this article we will focus on breast cancer which is one of the most common forms of cancer found in society.

Although breast cancer is a serious illness, the chances of survival, provided that proper treatment is undertaken, are very good. It is estimated that the probability of surviving breast cancer for 1 year after diagnosis is currently around 96% in the United Kingdom.

The need for critical illness contracts

“While the above is good news for breast cancer victims, the fact that more people are likely to survive and live with a previous breast cancer means that there is a greater need for additional finances following diagnosis with breast cancer,” says Van Der Nest.

He adds that critical illness contracts provide for this need by paying out a lump sum after diagnosis. This money can be used to fund the lifestyle adjustments necessary when recovering from breast cancer.

Cancer and critical illness claims

Cancer is the most common cause of critical illness claims in South Africa. Liberty recently published its 2012 claims statistics, where it was found that 47.8%, or almost 1 in 2, of all critical illness claims were cancer related. Cancer also contributed heavily as a source of claims for life cover, 1 in 5 death claims, and income protection claims, 1 in 6 claims.

Underwriting cancers

“Full disclosure of the individual and family history of cancer on the application form or during a telephonic interview is essential to the risk assessment and is also important because it allows the underwriter to request medical information from the doctor who treated the cancer. This full disclosure is essential to underwriting the risk and determining the contributions charged as well as the terms and conditions offered,” says Van Der Nest.

A Cancer Questionnaire is generally required from the doctor who treated the cancer to obtain information regarding:

• The location of the cancer and the exact name or type of cancer

• The date of diagnosis

• Establish when the treatment started and ended

• Establish how the cancer was treated

• The stage and grade of the cancer

• Establish if there has been any recurrence of cancer

• Determine if there is family history of cancer

A Histology Report is also crucial for determining the type, location, stage and grade of the cancer.

A Medical Examination may be required if there are any other co morbid medical conditions to assess. For example, a client with diabetes together with a previous malignant cancer presents as a poorer insurance risk as opposed to a client with just a previous malignant cancer.

Being diagnosed with cancer cannot be seen as a death sentence as there are many effective treatments which can beat it.


It is therefore encouraged that you are aware of your risk of developing cancer and are aware of your medical insurer’s policies regarding compensation. A lot more research can be done regarding the possible cause of cancer and seeing as though medical insurers stand to lose a lot of money in annual cancer payouts, contributing towards this research may benefit them. Do you agree with this? Please comment below, interact with us on Twitter at @fanews_online or email

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