LAST week I unwittingly kicked a hornet’s nest. It started with something mundane; I applied for income protection. When the insurance company then insisted on a so-called “mental health exclusion,” it floored me.
Let me explain more. Nearly two years ago, I was made redundant by the ABC. This turned out to be a most excellent turn of events. I started freelance reporting on social justice issues. It’s the career I’ve always hoped for. So far so good.
My financial planner, Scott, set out to find me decent income protection. In order to apply for the insurance, we sat together in his office and went through dozens of questions about my health and personal circumstances.
One of the things I mentioned in that discussion was the postnatal depression (PND) I’d suffered after my first daughter was born back in 2010.
One of the things I neglected to mention to Scott — because it wasn’t a mental health problem and seemed irrelevant — is that after being made redundant, I decided to go to a psychologist to debrief.
At the time, this seemed to be a sensible way to deal with a life-changing event. My lovely GP suggested that she give me GP Mental Health Treatment Plan because otherwise, it’s darn expensive to see a psychologist.
A few weeks after answering the questions with Scott, he phoned me to explain the insurance company wanted to give me a mental health exclusion.
To quote the agreement sent by the insurance company, the list of things I’m not covered for are as follows (take a deep breath — this is long): “…any mental or nervous disease or disorder including but not limited to anxiety, depression, stress, chronic fatigue syndrome, post traumatic stress disorder, exhaustion or fibromyalgia, physical complications of psychiatric disorders, drug and alcohol or substance abuse, cognitive impairment, behavioural disorders or complications arising from treatment thereof.”
Translation: I’m not really covered for a whole pile of important things, just because I had the audacity to see a psychologist after a life-changing event.
I’m unable to gain full insurance for another three years. Those three years must be “without an episode.”
As it turns out, I’m not alone. After posting about this experience on my personal Facebook page, friends went into overdrive posting about their own related experiences.
Illustrator and scriptwriter, Megan, 39, was one of the people who got in touch with me. She has no underlying mental illness.
“I was going through a particularly stressful time at work while moving house and this culminated in a panic attack one morning.
“I got it checked out at the GP because I’m a responsible adult and didn’t want to ignore heart palpitations, a dizzy spell [and] severe pain in my left arm. And now I have a three-year mental health exclusion. It’s outrageous,” she says.
“I was penalised for taking a precaution. I didn’t even take a day off work after that incident. I was 30 minutes late,” she adds.
Megan says the chain of events made her feel “really stigmatised.”
“I am fortunate not to have any ongoing mental problems,” she continues, “but why is it that mental illness that prohibits you doing your job is treated differently to physical health?”
At 31, Jessica learned she had primary ovarian failure and was infertile. The devastating news turned her world upside-down, effectively triggering an “acute mental health crises.”
She sought help for her grief through her GP and was subsequently put on a mental health plan, primarily so she could access “affordable and specialised psychological services.”
When Jessica then applied to increase her income protection, the company refused her request.
“I asked for the decision in writing because I couldn’t believe it,” Jessica says.
When the letter came, it only made the situation worse.
“The wording was ridiculous, as if they were capitalising on stigma to retain me as a customer via shame,” Jessica says.
Needless to say, the company did not retain her as a customer. She found a new insurer.
“That [new] insurer rang for further detail and was satisfied that the mental health crises I have on record … did not increase their risk,” she says.
Unbeknown to me, this chain of events actually has a name. It’s called insurance discrimination and mental health advocacy organisations beyondblue and Mental Health Australia have been campaigning together against it since 2002.
Dr Stephen Carbone is beyondblue’s Policy, Research and Evaluation Leader. He says that according to beyondblue’s previous research, nearly half of people “who had existing mental health conditions …[had] experienced some form of difficulty accessing insurance.”
Dr Carbone outlines two separate issues relating to mental health and insurance discrimination. The first is that people who simply don’t have a mental illness are “suddenly being assessed as if they’ve got some sort of underlying mental health condition.”
For example, Dr Carbone says he’s come across people on the receiving end of insurance discrimination who might have “trouble sleeping occasionally” or others who have seen a counsellor for issues such as “personal development, relationship difficulties [or] career counselling.”
The other issue concerning Dr Carbone is that people who actually do have genuine mental health issues are being locked out of insurance.
“Let’s face it, mental health conditions are so common” that insurance companies are “disadvantaging and perhaps discriminating against a very considerable proportion of the Australian public and that just doesn’t make sense to us,” he says.
Financial planner Scott Malcolm, director of Money Mechanics, (yes, the same Scott I was talking about before) backs up Dr Carbone’s view that insurance discrimination is incredibly common.
“This could include a mental health exclusion in the policy the client is offered or a full decline for insurance,” he says.
According to Scott, the practice is increasing because more people in the community are aware of their mental health and are seeking treatment.
“From discussions I have had with managers and underwriters at the insurance companies they are concerned of the increase in claims in the area,” he says.
Dr Carbone would like to see insurance companies offer a more personalised exclusion process.
“Most people will only experience a particular type of condition, that doesn’t mean they’re at risk of every single type of mental health condition that we know about.
“It’s not a one size fits all, you can’t just lump everyone into the same category and risk assess them to the same degree, it has to be more tailored, it has to be more nuanced,” he says.
The organisation that represents life insurance companies in Australia is called the Financial Services Council (FSC).
The CEO of the FSC, Sally Loane, says “Generally, if consumers have been symptom-free and off treatment for more than two years, it is unlikely that a loading or exclusion will apply,” she says.
However Ms Loane says in cases where a person had “serious or ongoing symptoms [it] may result in premium increase loadings to total and permanent disability (also known as TPD cover) or death cover, with a smaller number of consumers afforded exclusions.”
Ms Loane also believes that insurers do look at each insurance application on a case-by-case basis.
“Insurance companies are continuing to work on developing more innovative and tailored products for consumers,” she says, and “the insurers evaluate each consumer on their individual circumstances.”
Dr Carbone disagrees. He says when it comes to mental health, insurance companies are making decisions “arbitrarily”.
“There is a lot of data out there that can help them [insurance companies] to make decisions about how to rate someone’s risk, but we don’t really see any evidence that they’re making their decisions based on this data,” he says.
Pointing to the Disability Discrimination Act, he says: “They’re potentially acting unlawfully and discriminating against people.”
Dr Carbone is concerned that fear of insurance discrimination will discourage people that actually need mental health support from seeking it out.
“We encourage people with mental health condition not to be ashamed or embarrassed or fearful of seeking help … and anything that creates stigma or a barrier is absolutely not helpful for our community.”
According to Ms Loane, all customer-facing staff working for FSC members must undergo mandatory mental health training to ensure they have “an appropriate level of education … in relation to mental health awareness.”
She also points to the new Life Insurance Code of Practice for consumers, stating that future reviews of the document will “increase obligations on insurers when interacting with consumers suffering mental health issues.”
“Most Australians will know someone that lives with a mental illness, so it is important that society steps up to support them on the path to better mental health,” Ms Loane says.
Have you experienced insurance discrimination? Tell us your story in the comments section below.
Find out more about insurance discrimination and what to do about it at the beyondblue website or call on 1300 22 4636