While many insurance products acknowledge and provide coverage for mental health conditions, consumers continue to express dissatisfaction with the way the insurance industry deals with them, the Actuaries Institute believes. The latest green paper on mental health and insurance from the Actuaries Institute also found that the prevalence of mental injuries in workers compensation was greater in public employees than in the private sector.
The Actuaries Institute president, Jenny Lyon, said, “Difficulties can arise in many areas of the insurance process and there are many potential opportunities for improvement.”
Significant work is needed to improve insurance outcomes for those with mental health conditions and all insurance parties would benefit from a focus on recovery and wellness rather than claims eligibility, states the green paper. The Green Paper states the insurance sector should support early intervention to deal with mental health conditions, focus on providing the best treatment to reduce recovery times, and increase the likelihood that consumers can return to work.
The institute found that the insurance sector faced systemic difficulties dealing with mental health coverage, despite the fact that one-in-five Australians aged over 15 would be affected by a mental health condition in any 12-month period. Lyon said, “The problems raised by mental health conditions in the insurance sector are complex and multipronged.”
However, it also found that many insurers were improving claims processing, progress was hampered by insufficient data and subjective criteria for diagnosis, the claims process could e adversarial and could lead to secondary mental harm, there was a bias against early intervention that could hinder a claimant’s recovery and returns to work, and insurers faced real challenges to sustainability.
The paper states that the industry needs better data to more effectively deal with diagnosis and claims, and the claims process, which can be long and adversarial, can sometimes hinder recovery. Problems with insurance could arise at three different touch points between consumers and the insurance product – product design and definitions, buying or entering an insurance product, making a claim and receiving benefits or payments.
“There are no simple solutions. But the Institute hopes that by raising some of these issues, and applying a high level of technical financial expertise and integrity to the problem, we can stimulate worthwhile discussion and change,” continued Lyon.