As part of Life Insurance Awareness week, data from the Financial Services Council (FSC) has revealed the mental health burden shared in Australia, as almost half of claims for mental health were from just five types of conditions.
Life insurance claims data from 2019 showed mental illness was the highest cause of claim for total permanent disability (TPD) and the third highest for income protection.
Life insurers collectively paid $1.24 billion in 2019 to over 9,500 Australians for mental health claims.
The 46.9% of all claims for mental health conditions included:
- 16.5% - depression, including single and recurrent episodes;
- 13.4% - unspecified anxiety disorders, for example panic or anxiety attacks;
- 11.3% - reaction to severe stress, for example post-traumatic stress disorder (PTSD);
- 3.6% - Alzheimer’s disease; and
- 2.1% - schizophrenia.
Nick Kirwan, FSC senior policy manager for life insurance, said the data showed the incidence and duration of mental health claims for income protection varied widely depending where you lived.
“The data tells us ‘what’, but doesn’t tell us ‘why’. By releasing this data, we hope it encourages debate on this important topic,” Kirwan said.
“However, what is clear is that the prevalence and toll that mental illness takes on Australians and their loved ones needs to tackled as a community.
“For their part, life insurers would like the option to pay for extra treatment as an early intervention measure. The longer somebody is out of work, the harder it is for them to get back to work.”
Mental health claims by state
Kirwan said during Life Insurance Awareness week, all Australians should be encouraged to check what life insurance cover they had.
“Give your superannuation trustee or life insurance company a call today and make sure the cover you have is right for you,” Kirwan said.
KPMG provided analysis of the causes of life insurance claims on behalf of the FSC.