Headline figures show £235.2m in payments to 2,872 customers, compared to £224.6m in 2016.
The study also showed that cancer remains most common cause of critical illness claims and mental health for income protection. The company said 95% of all critical illness claims were paid in 2017 to 867 customers, with payments amounting to over £65.2m.
Cancer alone accounted for 59% with £40m in payments to support customers affected with the disease.
Heart attack was the second most common reason for claims, accounting for 14%, followed by stroke and multiple sclerosis – 6% and 3% respectively.
The average pay out for a critical illness claim last year was £75,000.
Just over half of claims were from men (54%), with the average claimant being 52 years of age compared to 49 years for women.
A number of claims were paid out last year for children covered by their parents’ policies (34 in total) amounting to over £647,000. Of the number of claims declined, 3% were where a customer had not disclosed key medical information on their application, such as lifestyle (smoking or drinking habits) or existing medical issues, and 2% were because a condition claimed for was not covered by the policy.
The vast majority (99%) of life claims were paid in 2017 benefitting 1,929 customers with payments of over £144.6m.
Where claims were declined lifestyle habits like smoking and drinking were again cited as the main reasons.
The statistics also showed more than £8.8m was paid out to around 500 income protection customers, with average monthly payments of £1,475.
There were 76 new claims last year and over 87% paid.
Mental health including depression, anxiety and stress was again the most common reason, accounting for 22% claims, followed by musculoskeletal conditions (18%), cancer (15%) and neurological illnesses (14%) such as multiple sclerosis.
Peter Hamilton, Zurich’s head of market management said: “Research periodically suggests that customers aren't necessarily confident that these kind of plans will pay out - these figures evidence that the overwhelming proportion of claims are successful.”