Bespoke cover: a new visit to the tailor

Illnesses such as cancer are never easy to deal with. Added to the medical and emotional pressures it puts on families, the financial pressures for treating this illness can be immense.

However, there is a silver lining around this dark cloud. In June 2016, media organisation The Economist reported that around 70 new cancer drugs are contributing to far better prognoses for cancer patients.

Doctors are also, for the first time, starting to talk about cancer cures rather than only talking remission. This new rhetoric is being driven by significant advances in technology, both within the medical field and outside of it.

Higher survival rates
Early diagnoses, made possible by advancements in medical technology and a well-informed symptom-spotting Google-generation, are also contributing to higher survival rates. Prominent individuals like Angelina Jolie, who had elective surgery to ward off her statistically high threat of breast and ovarian cancer, are also raising awareness.

The number of cases of cancer is continuing to rise. The World Health Organisation predicts new cancer cases will rise by around 70% over the next two decades and one in four South Africans will be impacted during their lifetime either directly or through a loved one being diagnosed. However, the instances of successful treatment are also increasing sharply.

Ensuring correct cover
What this means for financial planners is that ensuring every client has the right level of severe illness cover has never been more important.

Protracted treatment periods can deal a devastating blow to patients’ financial situation as they often have to stay away from work for extended periods while maintaining all their living expenses and covering many unforeseen costs.

We are deeply committed to ensuring that severe illness benefits remain affordable in light of the high cancer stats. Currently, more than 60% of severe illness claims admitted by the life insurance industry in any year are solely as a result of cancer.

In our current lacklustre economy, most people are finding it very hard to make ends meet, and it is imperative that they do not drop cover for something with such a statistically high risk.

This is why we have become the first financial services group in South Africa to innovate our severe illness offering to allow for an affordable cancer-only option.

Remembering the past
We need to remember that severe illness cover was the brainchild of Dr Marius Barnard. The brother of Dr Christiaan Barnard proposed the idea in the 1980s because he recognised that patients were struggling to cope financially during the treatment and recovery process.

Across the industry, the severe illness offering remained largely the same for three decades. However, it is necessary in light of very distinct claims trends to adjust how risk cover is packaged so it stays affordable. We must provide cover where it counts.

Not all cancers are the same
Unlike many tiered benefits that pay according to the stage of a cancer, Sanlam’s cancer-only benefit recognises that not all cancers are the same. For instance, while it would be suitable to pay 25% for stage one skin cancer, paying 25% for stage one pancreatic cancer will fall short of properly covering clients. As a result, Sanlam’s Impact range will pay 100% of the insured amount from stage one for specified aggressive cancers.

In designing the severe illness offering, we considered the impact of different cancers in order to make sure that when consumers are given more affordable options, they remain properly covered.

The cancer-only benefit also serves as an alternative for people who are not able to increase or acquire comprehensive severe illness cover due to other medical reasons. And for those with affordability concerns, cancer-only benefits provide a means to construct a more affordable overall package by combining comprehensive and cancer-only benefits.