The total amount paid out by insurers to help deal with death, serious illness or injury increased by 4% to £2.33bn last year, according to figures published by the Association of British Insurers today.
This means insurers paid out £6m every day across life, critical illness and income protection insurance, the ABI said.
In total, 56,105 claims were received last year across these three categories, of which 53,239 were paid out and 2,866 declined. The ABI contrasted this favourably with the situation the previous year, where 4,369 of the 62,623 claims were declined. In particular, it noted that the total number of claims declined across life and critical illness insurance decreased from 17% in 2006 to 9% in 2012.
Stephen Gay, head of life, savings and protection at the ABI, said: 'In 2012 insurers paid out more than £6m every day to help families dealing with the financial impacts of death, serious illness or injury. These payments provide valuable support to customers facing very difficult circumstances.
'People often make a claim on protection cover at what can be a very challenging time, so insurers want the claims process to be as smooth and straightforward as possible for their customers. This is why we have worked to help people better understand what their policies cover and don't cover, and improve claims handling in complex cases. It is good to see this resulting in a continuing fall in the number of declined claims.'
Life insurance accounted for the largest proportion of successful claims, with 28,203 claims paid - 98% of those received. Together, these claims were worth £1.39bn.
The total value of the 11,737 critical illness policies paid out on was over £820m, with 91% of all claims paid, while 13,266 people received a share of the £123,597 paid out on income protection policies.
The ABI noted that it was working with insurers to refine the definitions they use to report claims pay-out rates and ensure greater consistency across the industry. These will be used to report 2013 claims.
Gay added: 'These latest figures illustrate the positive effect of the work the industry has done so far to help people benefit from protection insurance. The new protection claims definitions to be developed will ensure consistency in how protection insurance claims figures are reported.'
