Protection insurance industry experts were at odds over progress made in mental health underwriting thoughout the sector citing examples of steps forward and where there remains significant work to do for advisers and insurers.
Zanele Sibanda, head of internal markets at Towergate Health & Protection, described changes to mental health underwriting as “revolutionary”.
However Stacey Penn, senior policy adviser at the Association of Mortgage Intermediaries, (pictured) contended that processes have not necessarily evolved.
Speaking at the Protection Review conference, Sibanda cited the example of one or two providers that have made some “really big” changes that “genuinely seek the reason, the rationale and the benefit to the end user of those changes”.
She pointed to the fact that some insurers were no longer asking detailed questions where people have attempted suicide 20 years previously as a “fundamental” change.
And Sibanda added it was important insurers were providing people with acccess to mental health services.
“That is important because that is a provider that has looked at the real time data of how customers are behaving, the challenges that customers are facing and the next thing big pandemic is mental health and that provider is ready for that,” she said.
“So that is an example of genuine innovation that matters.”
Underwriting takes ‘two steps back’
However, Penn was less effusive in her praise of the industry, citing the example of her friend who suffers with anxiety.
Penn explained that her friend had suffered a significant life event a couple of years previously which led to her being diagnosed with anxiety and prescribed medication.
She noted that her friend is in a much better position now, feeling like her anxiety does not have as much control and is even considering asking to reduce her medication dosage.
But the process of applying for income protection (IP) had been a difficult one which could have been handled better by the adviser and insurer and left her feeling vulnerable.
Penn recounted how the advice process had been going well until her friend received quotes by email, at which point things started to go wrong.
“My friend was happy to receive quotes by email and she pulled up the email and showed it to me. It had the ususal pleasantries and then it said there was just one exclusion applying and the premium is being reduced accordingly.
“And then there in bold was an exclusion for mental health.
“I asked her how that made her feel. She said it made her feel like she had taken two steps back with her mental health and perhaps it was having more of a hold on her than she had first realised.
“She explained to me that mental health is not black and white, but she felt she had been put in a box and that was it.”
Be pre-emptive and review exclusions
In terms of what could have been done differently, Penn suggested the adviser should have preempted that there would be an exclusion applying given that they were applying for IP and they knew her friend’s history.
She added that the adviser should also have picked up the phone in this instance as while she said she was happy to receive quotes by email, her friend was vulnerable and the adviser should have picked up on that and adjusted their approach.
This would have enabled her to have had the opportunity to ask questions, have them answered there so she would have been in a much better place when the email came through.
“I think we’re encouraging people to talk about their mental health, but I don’t think that the underwriting processes have necessarily evolved,” Penn told delegates.
“I think that where insurers are applying exclusions of this nature they should be committing to reviewing them at a certain point in the future.
“We need to be talking to our customers to be understanding their current situation. Have things changed? What tools have they got in place?
“I know I’m not the only one to say this but I feel my friend has a better understanding and control of her mental health compared to me.
“She has access to different apps. She meditates regularly. She’s very aware of how external factors influence her day-to-day wellbeing.
“I’d even go as far to say that I am more likely to have a mental health claim on my IP policy compared to her.”