In 2024, UK protection insurance providers reached a record milestone, paying out a combined total of £8 billion in claims, according to new data from the Association of British Insurers (ABI)and Group Risk Development (GRiD). The figures highlight the crucial role that life insurance, income protection, and critical illness cover play in supporting individuals and families during life’s most difficult moments.
£21.9 million paid out every day
Throughout the year, an average of £21.9 millionwas distributed daily to policyholders facing bereavement, illness, or injury. This includes claims paid under both individual and group protection policies, showcasing the extensive reach and reliability of the UK’s insurance sector.
Breakdown of individual protection claims
Out of the total £8 billion paid, £5.32 billion was attributed to individual protection claims. Although the total number of claims remained consistent at 275,000, the average payout increased by 10%, rising from £17,100 in 2023 to £18,700 in 2024.
The industry maintained a high standard of support, with 97.9% of all individual claims accepted, continuing a decade-long trend of strong claim acceptance rates. Common reasons for declined claims included non-disclosure of pre-existing medical conditions and claims not meeting specific policy definitions.
Growth in critical illness cover payouts
Payouts under critical illness (CI) insurance grew by 5%, totaling £1.3 billion. The average claim reached £67,600. As in previous years, cancer remained the leading cause, accounting for 62% of all CI claims. Notably, there was a 4% increase in cancer-related payouts, which amounted to £812 million in total.
Surge in income protection claims
Income protection (IP) insurance saw particularly strong growth in 2024, with total claims up 16% to £204 million, an increase of £28 million year-on-year. The average IP claim payout rose to £10,000.
The leading reason for income protection claims was musculoskeletal conditions, such as back and neck pain. These accounted for 34% of all IP claims, equating to a minimum of £32 million in benefits paid.
Group insurance claims see year-on-year growth
In the group protection market, £2.59 billion was paid out in 2024, an increase of £99.2 million compared to 2023. GRiD reported that all policy categories under group protection saw year-on-year growth, reflecting rising demand for employee-focused insurance benefits.
Leadership perspective
Oliver Rayner, Managing Director at IGotCover, offered insight into the wider meaning behind the figures:
“These numbers aren’t just data, they reflect real lives being impacted. At the heart of every claim is someone navigating uncertainty, and we’re proud to be part of an industry that provides meaningful financial relief when it’s needed most.”
Conclusion
The record-setting £8 billion in claims paid out in 2024 underscores the ongoing importance of protection insurance across the UK. As life’s challenges persist, so does the commitment of the insurance sector to deliver critical financial support – providing security and peace of mind to individuals and families when it matters most.
