Super funds must act early on suicide and TPD claims

Early intervention is key for superannuation fund insurers when it comes to mental illness cases, and suicide and total and permanent disability (TPD) claims, according to an insurance group.

IFS Insurance Solutions group risk principal Shane Fielding told a roundtable in Sydney that insurers have to think about designing products in a way that can facilitate early intervention and rehabilitation opportunities as it can have significant impact on the course of the claim.

The comments come as new research found suicide and total and permanent disablement (TPD) claims have totalled almost $350 million over a five year period between 2007 and 2011.

Non-profit mental health foundation SuperFriend, along with IFS, found suicide cost super funds' insurers over $201.5 million at an average of $120,410 a claim, while TPD claims totalled $147.9 million, at an average of $82,960 per claim.

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Titled the Super Mental Illness National Data (SuperMIND) project, the research examined claims related to mental illness, TPD and income protection, and suicide by age, gender and location, although the research does not go into why certain trends are happening.

The research showed claims rates for suicide were about five times higher for men than women. It also showed suicide claims for men peaked in the 39-44 age bracket, while TPD claims peaked for men in their mid-50s.

SuperFriend CEO Margo Lydon said giving participating funds customised reports that track their results against the benchmark, the research can help funds pinpoint the problem areas such as age, gender and location.

Funds can then design early intervention strategies to lessen the financial and social effects of mental illness and support members.

"The SuperMIND research reinforces the reality that mental health and wellbeing is a risk management issue not just for super funds and their insurers but for government, employers and the broader community." Lydon said.

"Mental illness-related claims are one of the few insurance claim types that a fund and their insurer can influence, lessen and ideally prevent if detected early."

Lydon also stressed the need for training staff in dealing with members with mental illness, and added "there's a hell of a lot more automation that can take place" when it comes to data collection.

Six insurers teamed up with 13 funds and their administrators to analyse data from 4.1 million members.