Advisers have indicated they believe life companies can do more when it comes to dealing with clients who have mental illness or have experienced mental illness in the past.
By a margin of two to one, advisers have answered ‘no’ to our poll question:
Are you generally satisfied with how your preferred insurers manage underwriting and claims processes for Australians where mental illness is a factor?
This poll question has been discussed in detail within the Australian Risk Advisers network, where some of the key points raised by advisers and others suggest that greater understanding and process flexibility is needed:
- Some insured clients may decide not to submit a claim based on mental health reasons because the processes themselves may contribute to entrenching a mental illness ‘mindset’. There have been instances where clients have not submitted mental health-related claims because they did not wish to run the risk of labelling themselves as mentally ill and ‘de-railing’ their recovery by having to submit to the claims process itself.
- How can a claims assessor determine the overall impact of a mental health condition based on the severity of an event? Some people cope better with life-threatening situations than do others who have experienced much less severe stressors.
- Preventative counselling: Are emergency workers who are trending more and more towards preventative counselling as part of their jobs penalised at underwriting time because they have received this counselling? This point also applies to psychologists and other professionals who deal with some of the lesser characteristics of human nature.
One solution offered has been a suggestion to categorise mental health conditions (red flag/yellow flag etc…) in a way that will maintain the integrity of the claims process but would, at the same time, reduce the volume and frequency of the associated paperwork and other processes.
This is a difficult issue to resolve. Advisers have indicated they believe life companies should be doing more in this area, but life companies must also maintain often stringent processes because of the prevalence of inappropriate or fraudulent mental health claims.
We again remind advisers and other industry contributors that the topic of mental health and insurance is being addressed by the Financial Services Council at its 2012 Life Insurance Conference in Sydney on 22 March, where one of the sessions will consider: Mental health and insurance – the way forward.
Our poll remains open if you wish to vote and to add your comments…
