ALA welcomes Royal Commission investigation into mental health discrimination by insurers
10th Sep 2018
The Australian Lawyers Alliance (ALA) has welcomed the decision by the banking Royal Commission to call for more information into the issue of mental health discrimination by insurers.
“Too many people have been denied insurance after disclosing a mental health condition, even minor and one-off incidents,” said Mr Josh Mennen, solicitor and spokesperson for the Australian Lawyers Alliance (ALA). “We wrote to the Commission in June asking them to address this important issue so we are pleased the Commission has agreed to consider it further.
“We believe there are systematic problems with the way people with mental health conditions are treated by the insurance industry and this needs serious investigation.”
The Royal Commission provides an opportunity to compel insurers to release the actuarial data they are using to assess risk and make decisions on insurance applications and claims from people who disclose a mental health condition or otherwise explain the absence of such data.
“We have seen examples of clients who have not disclosed a mental health issue and have had their policies cancelled, even when their condition is minor and could just have resulted in a small variation to the policy,” said Mr Mennen.
“The insurance industry needs to be asked to explain its practices and have these decisions externally reviewed by the Royal Commission.
“There is evidence that there are discriminatory practices in place in the way insurers design, price and offer policies, and assess claims for people with past or current mental health conditions, particularly their use of blanket mental health exclusion clauses where they lack supporting data.
“A consumer should not have to take legal action to get an insurer to justify its decisions with appropriate data in relation to mental health.
The ALA is a national association of lawyers, academics, and other professionals dedicated to protecting and promoting justice, freedom and the rights of the individual.