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Claims long-term disability are increasing at the same rate as the GDP


Susan Yellin

21 June 2017 07:00

RBC Insurance has made a discovery that she qualifies as a major : the number of compensation claims in long-term disability increases at the same time as the growth of the gross domestic product (GDP).

In arriving at this conclusion, RBC has conducted six years of research with over 300 000 customers of the group insurance.

In times of economic difficulties, the employees tend to hunker down at work, because they fear losing their jobs. «As GDP increases and as the economic outlook improves, the workers feel a little more reassured; the stress held up and the anxiety will eventually catch up with them, so they fall ill and take sick leave to recover,» says John Carinci, vice-president, markets group insurance and insurance business, RBC Insurance.

The algorithm estimate used is based on the economic projections of RBC. Its latest projection forecasts that the rate of incidence of long-term disability will decrease by an average of 3.2 % in the first six months of this year (compared to last semester of 2016). However, the improvement in the outlook for the canadian economy will see this rate increase to 2.1% at the end of the year, compared to last year.

Mr. Carinci states that the long-term disability, it is the third cost of the importance of group insurance programs, after health insurance, and dental care. Now that we know the relationship between the rate of incidence of long-term disability and the economy, the companies can act in order to avoid some claims, taking care to support their staff in a period of accelerating GDP growth, » he said.

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