COVID lockdowns delayed healthcare. People died as a result, life insurers report

Editor's note: This story has been corrected to note that the remarks from Hartford Chairman and CEO Christopher Swift occurred during a call regarding the third quarter of 2021.

Life insurance companies and industry analysts reported a sharp rise in death claims last year, as would be expected because of the COVID-19 pandemic. What was unexpected is that many of these claims were made for non-COVID-related deaths, which were unusually high in 2021, possibly because many Americans could not access the health care they needed during the lockdowns in 2020 and in their aftermath.

A survey of 20 leading sellers of group life insurance policies to employers led by the Society of Actuaries Research Institute showed a spike in insurance claims in the third quarter of 2021, many of which were for deaths that were not caused by the novel coronavirus. The survey found that incurred claims counts were nearly 40% higher than a pre-pandemic baseline, with nearly a 50-50 split between claims that were directly linked to COVID-19 and those that weren't, the Wall Street Journal reported.

While claims for COVID-19 deaths increased 18.7%, as would be expected during the pandemic, there was also a 19% increase in claims for non-COVID deaths, which was highly unusual and surprising.

The survey results corresponded to what several life insurance companies told industry analysts and investors in earnings calls, according to the Journal.

Companies including Hartford Financial Services Group Inc., Primerica Inc., and Reinsurance Group of America Inc. each observed higher non-COVID-19 death claims compared with pre-pandemic baselines.

The companies attributed the excess deaths to delays in medical care associated with the 2020 coronavirus lockdowns, as well as people's continued fear of seeking medical treatment or trouble scheduling appointments due to causes related to the pandemic.

"The losses we are seeing continue to be elevated over 2019 levels due at least in part, we believe, to the pandemic and the existence of either delayed or unavailable health care," Globe Life CFO Frank Svoboda reportedly told investors in February.

He listed heart and circulatory issues, as well as neurological disorders, as causes for many of these deaths. "We anticipate that they'll start to be less impactful over the course of 2022 but we do anticipate that we'll still at least see some elevated levels throughout the year," he said.

Heart, stroke, and cancer were prominent causes of death, according to Hartford financial chief executive Christopher Swift, who told analysts in October 2021 that his company had "experienced higher levels of non-COVID excess mortality during the [third] quarter."

Another group life insurance seller, OneAmerica Financial Partners, reported a 140% increase in claims for working-age adults over their pre-pandemic baseline — with one-third of those deaths likely caused by delayed medical care.