Understanding the financial impact of illness

Zurich Financial Services has released its updated “Cost of Care” analysis on the growing incidences and cost of illness in Australia, which it said could help risk advisers to better understand the potential financial implications for their clients.

Using publicly available economic and health data on more than 30 major medical conditions, Zurich compared the prevalence, incidence and survival rates, and calculated the average lifetime and out-of-pocket cost for these common conditions.

Zurich Australia and New Zealand’s chief claims officer Matt Paterson said the report could help advisers better service their clients.

“As health diagnoses and treatment continue to rapidly advance, this analysis can serve as a useful single source of truth for insurance professionals, financial advisers and the broader community, assisting individuals and families to make informed decisions to improve their collective health and financial resilience,” Paterson said.

The latest report revealed that spinal cord injuries had the highest lifetime cost in 2023, averaging between $6.8 million and $12.9 million. This is followed by childhood cancer, costing around $1.09 million, and motor neurone disease, coming in at an estimated $201,340.

Other common illnesses also come with a significant financial burden, with type one diabetes costing an average $143,000 over a lifetime and chronic kidney disease with kidney failure costing around $41,748 per year.

Highlighting the financial impact of illness, Paterson explained how struggles related to the existing economic environment can be compounded by the cost of illness.

“There is a significant financial burden associated with the treatment of certain medical conditions in Australia. Concerningly, many of these are growing in prevalence against a backdrop of increased cost-of-living pressures and issues with access to insurance,” Paterson said.

Looking at the economic toll of cancer in Australia, the report found that head and neck cancer and thyroid cancer have the highest average lifetime costs in 2023, totalling $109,300 each.

These were closely followed by non-Hodgkin lymphoma at $100,190 and lung cancer at $85,420. Of the top 10 most expensive cancers, all had an average lifetime cost over $20,000, highlighting the financial pressure of these illnesses.

Highlighting the rising prevalence of cancer in Australia, the report found that eight of the top 10 most occurring cancers had increased the number of yearly cases since 2018.

In 2023, prostate cancer was the most common and saw the steepest increase with 25,487 cases, up 43.8 per cent since 2018. This was followed by breast cancer with 20,668 cases, up 14.4 per cent, and melanoma with 18,239 cases, up 27.4 per cent.

Paterson added: “This data will play an important role in the continued delivery and ongoing evolution of wellness and rehabilitative health services offered to Zurich’s customers, particularly given the preventable nature of many of these conditions.”