Discovery Life marks 25 Years with shift toward 'Living Benefits' as industry faces R50 trillion protection gap

Stephen Grootes speaks to Gareth Friedlander, deputy CEO of Discovery Life about how the insurer has transformed life insurance over the past 25 years by shifting value from paying mostly at death to delivering benefits and rewards throughout clients’ lifetimes.

Listen to the interview in the audio player below.

Discovery Life is marking its 25th anniversary with a pivot toward 'living benefits' as the insurer reports a growing share of payouts being made while clients are still alive.

This is regarded as a notable shift in a sector traditionally focused on death-related claims.

According to the company, more than 60% of its payouts now go to clients during their lifetimes, compared with an industry norm of 20% to 30%.

In 2024, Discovery Life paid out R3.1 billion in living benefits and returned an additional R2.4 billion through its Shared-value rewards programme.

The milestone comes as South Africa faces a deepening life-insurance shortfall. The latest ASISA Insurance Gap Study places the national protection gap at R50.4 trillion, with formally employed earners holding only 39% of the cover required to protect their dependants.

Discovery Life, which has more than 450,000 lives insured and R2.2 trillion in cover in force, says it intends to play a greater role in closing that gap.

Speaking to Stephen Grootes on The Money Show, Gareth Friedlander, Deputy CEO of Discovery Life says this latest shift is just one of many changes seen in the insurance industry in South Africa over the last 25 years. 

"I guess the real game changer for us as a business came with the whole Vitality concept, which we now call the shared value insurance model, and really just understanding how to change people's behaviour, to incentivise healthier outcomes and positive behaviour change in consumers, and turning that into money, literally" said Friedlander.

"Insurance is no longer just a world where you are there with a bunch of actuaries trying to determine what the risk is. The world has come a long way from that and it makes sense to try and help people change their risk and improve their outcomes and their risks and health & wellness."

"In the world of big data and AI, and where we're going from a global industry perspective, I think the opportunity is even greater."

"R2.4bn was paid through shared value benefits for clients looking after their health and wellness last year alone. The life insurance paradigm has shifted a little, from something that only pays out when you die, to something that can start to pay out during your lifetime," added Friedlander.

Scroll to the top of the article to listen to the full interview.