Jill Stark June 24, 2012
PEOPLE with a history of depression, insomnia or stress are being denied access to insurance, with health experts accusing the industry of systemic discrimination against those with even mild mental health problems.
A report by beyondblue and the Mental Health Council of Australia reveals many insurers are refusing to offer income protection, life insurance, private healthcare or travel coverage to people who have been depressed or anxious, in some cases claiming they are a suicide risk.
The report highlights how mild forms of depression are being put in the same category as serious mental illnesses such as schizophrenia and psychosis and used as a reason to deny insurance or charge higher premiums.
The survey of 500 people with a history of mental health problems showed that 45 per cent had been turned down for income protection and 36 per cent were refused life insurance.
For those who did obtain insurance, many faced exclusions on claims relating to mental illness.
Respondents said they felt ''humiliated'' and ''violated'' by insurance staff asking blunt questions such as: ''Are you currently suicidal or do you have plans to commit suicide within the next 12 months?''
Even if the illness was decades ago and the customer had a letter from a doctor declaring it did not impair normal functioning, people were often still turned down.
One broker told a client that too many people were claiming for depression and increasingly insurers were not prepared to cover the condition as it was too easy to ''feign''.
Kate Carnell, chief executive of beyondblue, said the practice was discriminatory and not based on evidence.
''Some of these things we wouldn't perceive as mental illnesses at all. In some cases you've got people being denied access due to insomnia or stress. Who hasn't suffered stress?'' she said.
''We fully accept that there may be certain conditions that may preclude insurance companies giving people certain sorts of cover based upon good actuarial data, but this catch-all approach doesn't make sense. It doesn't take into account people who are being treated who are stable and leading normal lives like anyone else.''
Frank Quinlan, chief executive of the Mental Health Council of Australia, said the report highlighted the challenges of ongoing stigma against those with a mental illness.
''If people feel as though they're going to be discriminated against in insurance or employment, it does interfere with help-seeking behaviour,'' he said. ''So right at the time when we're trying to encourage people to talk to each other, to speak openly and seek help, we don't want to be having systemic barriers in place that prevent people from doing that.''
A spokesman for the Insurance Council of Australia, Chris Sealey, said the body was a member of Minister for Financial Services Bill Shorten's mental health and insurance working group, which is looking at mental health problems and discrimination as part of broader insurance reforms.
''The working group has been considering the work needed to be undertaken with the medical profession so a consistent scale is used to assess mental health issues and to enable the establishment of reliable databases,'' he said. ''Insurers cannot price risk they cannot assess. For example, as currently used, the term 'depression' covers a range of conditions of varying severity and insurers are unable to assess the likelihood of the depression recurring.''
Mr Quinlan said many customers who declared a prior mental health problem were immediately turned down for insurance with no explanation, and better education was needed for call centre staff and brokers.
One survey participant said: ''I've been unable to find any insurance companies that will allow me to purchase life insurance because of my mental illness …
''I am much fitter and healthier than the average person, yet they approve income protection insurance to clinically obese sedentary office workers who don't look after themselves properly.''