Prevalence of mental illness above average in financial services
Life insurers looking to improve their processes for dealing with mental illness claims need to start by tackling issues within their own firms, an industry leader believes.
Speaking at the Financial Services Counsel Life Insurance Conference 2016 in Sydney, Metlife Insurance Ltd chief executive, Deanne Stewart, said the industry needed to start dealing with the challenge of mental illness within the sector, as part of moves to improve the way it handles clients' claims.
"It is important to start there… it does start with the work environment in financial services," she said.
"While there's one-in-five of the working population at any given moment facing mental health issues — in our industry, that's one-in-three.
"Our industry is facing challenges that add to the stress and anxiety we are facing. You have to start there with an acknowledgement of what's going on in our industry, and the work environment in financial services, because that had a cascade and ripple effect on everything else we do.
"There's a lot of people that I speak to right across financial services where I hear words like ‘stressed', ‘working 24/7', ‘fearful', I even occasionally hear the word ‘toxic' involved in speaking about our environment.
"If that's the leadership, the culture, the environment, how can you then have all these policies, procedures and great things?"
Stewart said that while life insurers had done some "great work", there was more to be done to improve the claims process — noting that mental illness accounts for "between 15 and 20 per cent of claims, but up to 50 per cent of the total claims expense".
"In terms of the underwriting and claims capability, there has been some real improvements and transformation across the industry over the last couple of years," she said.
"But I would still say that there's a lot more work to be done here."
AUTHOR
Nicholas O'Donoghue
Recommended for you
The Federal Court has dismissed a conflicted remuneration case brought by ASIC against the director of life insurance distributor Freedom Group, where Bali holidays and Vespa purchases were among sales incentives.
Policy and advocacy specialist Benjamin Marshan has left the Council of Australian Life Insurers after less than a year, having joined in March from the Financial Planning Association of Australia.
The declining volume of risk advisers meant KPMG has found a rising lapse rate for insurance policies arranged by independent financial advisers, particularly in the TPD and death cover space.
The Life Insurance Code of Practice has transferred from the Financial Services Council to the Council of Australian Life Insurers.
