Due to a curiosity for all things medical (and ongoing professional development requirements!), I recently attended a seminar in relation to underwriting and claims.

Part of the presentation focused on diabetes which is becoming more prevalent in Australia, and is of increasing concern for life insurers from both an underwriting and claims perspective. 

The facts:

With approximately 1.2 million people currently diagnosed with either Type 1 or Type 2 Diabetes, and an estimated 500,000 others who are undiagnosed with Type 2 diabetes, this chronic condition is becoming one of Australia’s greatest health issues.

Type 1 diabetes (known as insulin dependent diabetes mellitus or juvenile diabetes) is an autoimmune condition which is typically diagnosed under the age of 30, but can occur at any age.  Type 1 diabetes is often linked to family history and requires lifelong insulin replacement, usually via injections.  Insulin is a hormone produced by the pancreas which converts the glucose from food, and turns it into energy.  Type 1 diabetics create little or no insulin of their own, due to damage to the cells in the pancreas that produce insulin.

Type 2 diabetes (non-insulin dependent diabetes mellitus or adult onset diabetes) is usually caused by genetic or lifestyle factors, and is a progressive condition whereby the sufferer develops resistance to the effects of insulin, and/or gradually loses the ability to produce enough insulin in the pancreas.  Type 2 diabetes represents up to 90% of all cases, and usually diagnosed over the age of 45, but is increasingly being diagnosed in children, teenagers and younger adults.

In Australia, 280 people per day will develop diabetes which is around 1 in every 5 minutes!

The impacts:

  • The estimated annual cost of diabetes in Australia is $14.6 billion.
  • 40% of Type 1 sufferers will develop serious kidney problems leading to kidney failure prior to age 50.
  • Diabetic Retinopathy damages the blood vessels in the eyes, and is the leading cause of blindness in adults.
  • Diabetic Nephropathy damages the filtering units in the kidneys, and is the leading cause of renal failure.
  • Diabetics have a 2 to 4-fold increase in the risk of stroke or death caused by cardiovascular events.
  • 8/10 diabetics will die from cardiovascular failure.
  • Diabetes can lead to damage to the peripheral nervous system in the feet and hands known as diabetic neuropathy.
  • High blood sugar can damage and weaken blood vessels in the limbs causing them to narrow and reduce the circulation of blood around the body, resulting in the death and decay of tissue. The only treatment is available is amputation of the affected body part.

Diabetes and insurance

Due to the long term complications of diabetes, obtaining personal insurance cover when the illness is an existing condition, or there is a strong family history, can be difficult.  An underwriter may decline the application, exclude the illness, or increase the premiums for the cover.

The increasing presence of diabetes in Australia highlights the need for adequate personal cover.  Many of the insurers offer benefits under their Trauma policies for the diagnosis and complications arising from Type 1 and Type 2 diabetes.

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