The Public Interest Advocacy Centre’s (PIAC) mental health and insurance project highlighted that people with mental health history are being denied insurance or “offered cover subject to broad, unreasonable exclusions”.
PIAC’s report noted ongoing issues with life insurance products such as income protection insurance and has called for measures to be implemented to increase industry accountability including making changes to the life insurance code of practice.
PIAC senior solicitor Ellen Tilbury said the issue is now a matter of public interest.
“We don’t believe that change will occur unless underwriting practices relating to mental health come under the scrutiny of ASIC – the appropriately empowered regulator,” Ms Tilbury said.
“If insurers don’t lift their game, there is a real chance people will be discouraged from seeking essential treatment for common conditions like anxiety and depression, for fear of being locked out of insurance.”
In statements given exclusively to ifa, local life insurers TAL and MetLife supported PIAC’s call, saying that supporting customers with mental health conditions is one of the most important jobs for the industry.
“The life insurance industry continues to develop and evolve our practices in respect of providing life insurance products sustainably for all sections of the community,” TAL’s statement read.
“TAL welcomes the PIAC report as a further opportunity to engage with stakeholders to challenge and continue to develop our practices. TAL will review the report in more detail and we remain committed to playing our part in working with the industry, our partners and groups such as PIAC on continuing to enhance our support and life insurance opportunities for those customers with mental health conditions.”
The report follows a 2019 analysis conducted by KPMG that found that claim payments for mental health conditions in the life insurance industry totalled $1.24 billion to over 9,500 Australians.
ASIC told ifa that is currently considering the report and the issues it raises.
Hahahaha, I see the lawyers involved know nothing about insurance and selecting risk.
these consumer groups really struggle with the reality of this industry. Maybe if one of them actually had ANY hands on experience they may begin to grasp their advocacy has helped wreck this industry.
It was only a matter of time before someone would call for such an “investigation” or the like. The problem is that APRA have already enforced significant changes on insurers because they have been incapable of managing their books of business in a responsible manner. Sadly newer clients have less attractive benefits available to them and long term clients are getting absolutely stung with premium rate rises making their cover unaffordable thanks in no small part due to the significant impact of claims related to mental health illness. Not sure what the answer is, but I’m pretty sure that private commercial entities should be able to choose who they want to do business with?
You would think so – but the Government and their agencies have this “entitlement to interfere” in areas they shouldn’t.
Very hard to look inside someones mind. These claims go on for years, some a genuine, I have one that has been going on for 11 years.
Yeah that will just make insurance even more unaffordable. More damage will be done by increasing premiums to cover mental health conditions, which will lead to more people cancelling policies, less trust in insurers, and ultimately less people insured overall.
…and then no insurance industry for cover of this nature. Same thing happened with redundancy cover…
This will end up the position, no cover for mental health conditions