Insurance industry MoU aims to ensure fair treatment of mental health clients

Concerns about the lack of fairness and equality of treatment by insurance companies dealing with people who have a history of being treated for mental health disorders have prompted complaints to organisations such as the Mental Health Council of Australia (MHCA) and beyondblue. Although these concerns have existed for a long time, the issue of discriminatory treatment by insurance companies has been heightened by the increased numbers of people in the community seeking treatment for mental health problems under the Better Access Medicare initiative. The APS is aware of significant disquiet among psychologists who report clients' concerns about being treated for mental health problems and the implications this has for disclosure of medical information in insurance assessments.

In response to concerns and complaints, the MHCA commenced negotiations with a body known as the Investment and Financial Services Association (IFSA) - a peak body for some types of insurance in Australia. A number of mental health bodies have worked with the MHCA around this issue and created a Mental Health Sector Stakeholders (MHSS) group. The MHSS is made up of seven key national organisations and professional groups representing the interests of the Australian health and mental health sectors, as follows:

• Mental Health Council of Australia
• Australian Psychological Society
• beyondblue - the national depression initiative
• Royal Australian and New Zealand College of Psychiatrists
• Australian General Practice Network
• Australian Medical Association
• Royal Australian College of General Practitioners.

In October 2008 the MHSS signed the fourth Memorandum of Understanding (MoU) with the IFSA and the Financial Planners Association (FPA), the aim of this collaboration being to:

• Ensure that life insurance companies apply non-discriminatory procedures in respect to mental illness according to proper life insurance principles
• Inform MHSS, consumers and carers about the ‘Underlying Principles', their implementation and the impact of mental health conditions on these principles.

‘Underlying Principles' is the philosophy of implementing underwriting, claims, complaints and other procedures for administering life insurance in a fair and equitable way according to proper life insurance principles. These include identifying and considering relevant factors in respect of the risks associated with accepting a consumer for cover, assessing claims and dealing with complaints. This reduces the likelihood that assessors will make judgements on superficial or unjustified grounds. Through the MoU, the MHSS, IFSA and FPA will promote the education of their constituents and other stakeholders regarding the implementation of the Underlying Principles.

A 2008-2010 workplan has been developed to work to specific goals and guide activities to be completed under the MoU by a Steering Group. The following have been identified as priority activity areas:

• Improved communication and education through review of current industry procedures and clear communication and education processes with stakeholders
• Improved complaints resolution through review of underwriting and claims practices and guidelines, and through the provision of education to stakeholders
• Improved underwriting and claims by periodic review through the MoU Steering Group.

The MoU will operate until 15 October 2010 and financial support has been provided by beyondblue and IFSA. An evaluation of the success and impact of the MoU will be conducted by assessing progress against the goals of the initiative.