Cancer dominates AIA Insurance claims accounting for a third of total insurance payouts in 2023, with breast and skin cancers representing over half of cancer claims

Cancer was the leading cause of insurance claims for AIA Insurance last year, with nearly a quarter of a billion dollars paid out in cancer-related claims. 

According to a new report released by the country’s largest life insurer on Thursday, cancer claims accounted for 33.2% of AIA’s total claim payouts in 2023.

AIA, which has over 800,000 members and provides life, health, trauma, and income insurance, paid out $244.1 million in cancer claims across all of its categories last year. 

Of that $244.1 million, $133.9 million was specifically from life insurance cancer claims.

Overall, AIA paid out $734.8 million in insurance claims in 2023, up from $646 million in 2022—an increase of 13.7% or $88.8 million. 

“The volume is increasing, but also the cost per claim is increasing,” AIA’s Head of Claims Travis Higgins told interest.co.nz on Wednesday.

Post-Covid impacts, transportation costs, and drug prices are “absolutely putting pressure on the healthcare industry,” according to Higgins. 

He noted medical inflation had risen 10% to 11% on a cost-per-claim basis last year alone for AIA.

“Was it a surprise? No. Are we looking at obviously what we can do and the role that we can play? Yes, absolutely,” he said.

He added that medical inflation had risen well above Consumer Price Index (CPI) inflation and health insurers and the private health sector needed to work closer together.

Cancer is the leading cause of death and serious illness in New Zealand, with 71 new diagnoses each day, according to Cancer Society NZ.

Breast cancer, melanoma, and skin cancers were the top cancer claims in AIA's 2023 insurance data. Over a third – 33.4% – of AIA NZ's cancer claims were for breast cancer.

Melanoma and skin cancers made up 20.3% of AIA's total cancer insurance claims, followed by bowel cancer at 6.5%, prostate cancer at 6%, and lung cancer at 4.6%.

Across the different age groups, the most claims were paid out for those between the ages of 50–59, with over $197 million spent in the 2023 year. The next most expensive age group was 60-69, with $139 million in claims.

The least expensive was those under 20, but AIA still paid out over $9 million in claims for this group.

Higgins said AIA receives about 80,000 claims a year, averaging 600 claims a day. In 2023, 92% of all claims received were accepted, down 1% from a year earlier.

Across all of AIA’s different insurance categories in 2023:

• $17.3 million was paid out in total permanent disablement claims
• $85.5 million was paid out in income protection claims
• $117.1 million was paid out in trauma claims
• $143.1 million was paid out in health claims
• $263.5 million was paid out in life claims.

Higgins expects the total claims amount for the 12 months to December 2024 to exceed the $734.8 million paid out last year.

“I'm actually having active conversations, particularly with healthcare providers at the moment to understand the dynamics within their business, to understand how the two sectors can work together,” he told interest.co.nz.

“I think that's going to be really key to ensuring that everything remains sustainable in the future.”